As we are well aware, taxes are one of the crucial elements that make up a modern society. As such, they are collected by financial organisations like the IRS, or Internal Revenue Service, of the US government from individuals or businesses.
It is unfortunate that not everyone has the same amount of time and wealth at a given point to pay their taxes when they are due. So, what these central government agencies do is take non-compliance action against such owners of land or businesses to ensure payment.
One such punitive measure is the filing of an Internal Revenue Service lien, abbreviated as “IRS lien,” which bestows them with legal ownership to seize the property of a faulty taxpayer. This article goes on to explore the various facets of an IRS tax lien and its process of execution.
Understanding the basics of a tax lien
It simply gets executed when the local government of a constituency places a tax lien on a land or property if the owner is successfully in arrears with regard to tax payment. This can occur either due to non-payment or a significant lag in paying the regional income tax money.
However, a point to be noted is that the property will not get sold, although it will be in the hands of the creditor, until the payment is made. It just ensures that the payment is done on priority, and the first to have a claim on the land would be the creditors who seized them.
How does the tax lien process work?
- The process duly gets initiated with a letter from the authority stating how much debt is owed. This piece of paper is called the official notice and demand for tax payment.
- The problem arises when the taxpayer tries to act deceitfully by either not paying attention to the notice and resolving with the officers or not making prompt payment as soon as he or she gets the notice. In such cases, the property will be seized immediately.
- In special scenarios where the taxpayer is in a dire situation like bankruptcy, the process will be followed after the person gets out of it.
Seek direct assistance from expert professionals to learn more about IRS tax lien sale of property.
