The IRS Doesn’t Forget: How Federal Tax Liens Work and What You Can Do About Them

If you’ve ever Googled your name and seen “federal tax lien” pop up, you probably felt a pit in your stomach. Or maybe you just received a notice in the mail with big bold letters: Notice of Federal Tax Lien.

It’s easy to panic. But don’t. This blog is here to help you understand:

✔ What a tax lien actually means

✔ How it affects you and your finances

✔ And what you can do to fix it — even if it’s already filed

What Is a IRS Tax Lien, Really?

A federal tax lien is the IRS’s way of saying, “Hey, you owe us money — and we’re putting our claim on your stuff.”

That means the government has a legal right to your current and future property until your debt is paid or resolved. This includes:

• Real estate

• Vehicles

• Business assets

• Personal property

• Even money in future bank accounts

A lien doesn’t mean the IRS is taking anything yet — but it secures their interest so they can later if necessary.

How You Get One

Here’s how the process works:

1. The IRS assesses your tax debt.

2. They send you a bill (Notice and Demand for Payment).

3. You don’t pay in time.

4. They file a Notice of Federal Tax Lien (NFTL) in public records.

Once that’s filed, creditors see it, lenders are wary, and your financial reputation takes a hit.

How a Lien Hurts You

Even though an IRS lien is different from a levy, it still has serious consequences:

• Credit impact: While liens are no longer on consumer credit reports, lenders still check public records.

• Selling property gets complicated: The IRS can claim proceeds before you get paid.

• Business at risk: It can impact your ability to get funding or operate smoothly.

• Stress & reputation: It can follow you like a shadow — publicly.

How to Get Rid of It

There are several ways to deal with a federal tax lien — but it depends on your situation. Some options include:

✅ Paying in full

Obvious, but not always possible. The lien is released within 30 days once the full amount is paid.

✅ Setting up a payment plan

Certain installment agreements may qualify for lien withdrawal.

✅ Lien subordination

This doesn’t remove the lien, but lets another creditor move ahead of the IRS (e.g., refinancing a mortgage).

✅ Lien withdrawal

In some cases, you can request to have the lien withdrawn entirely, even before full payment is made — especially if it helps you become more financially stable.

How I Help Clients with Tax Liens

When a lien shows up, it’s not just about money — it’s about your peace of mind, your reputation, your ability to move forward.

As a tax representation expert, here’s what I do:

• Review your case and IRS file

• Identify options for resolution (and explain them clearly)

• Deal directly with the IRS so you don’t have to

• Help you apply for removal or withdrawal

• Build a game plan so it doesn’t happen again

You Have More Power Than You Think

The IRS may have filed a lien, but that doesn’t mean it’s the end of the story. There are rules they have to follow — and options available to you.

📅 Schedule your Tax Strategy Session today to take the first step toward peace of mind and a fresh start.