Dealing with a tax lien from the IRS is intimidating and frustrating. Worse yet, an IRS tax lien can follow you for years. Even if you pay off the lien (in full), it will likely still show up on your credit report for seven years if you do not take action.
The good news: Whether you have already paid the lien or it is still outstanding, you may be eligible to have that tax lien permanently removed from your credit report.
At North Suburban Legal Services LLC, our top-rated Chicago IRS lien removal lawyers are committed advocates for taxpayers. We offer a full range of tax law services. If the IRS placed a lien on your property, we will work to protect your financial interests, including taking the appropriate action to get the tax lien removed from your credit report.
Three Things You Need to Know About Getting the IRS Lien Off Your Credit Report
In the United States, credit reporting issues are governed by the Fair Credit Reporting Act (FCRA). As a general rule, all adverse information that is included within a person’s credit reporting takes seven years to naturally ‘roll off’ the report. This is true for IRS liens. If an IRS lien appears on your report, that information will remain on the report for seven years. This is true even if you pay the lien – unless you take action.
Under the IRS Fresh Start Program, the agency dramatically expanded its authority to withdraw tax liens. A lien that has been paid but not withdrawn will remain on your credit report. However, a lien that has been withdrawn by the IRS can be removed immediately. To get a lien withdrawn, a taxpayer should fill out Form 12277, Application for Withdrawal of Notice of Federal Tax Lien.
To qualify, the lien must either be paid, or the taxpayer must enter into a direct debit installment agreement with the IRS. This is where a Chicago tax attorney can be extremely helpful. If you owe a significant amount of money to the IRS and a lien has been placed your property, your lawyer can help you reach a settlement with the IRS and work to get the lien removed from the property.
The major credit reporting agencies have a duty to look through public records to update information. Unfortunately, IRS liens that have been withdrawn are sometimes not updated for months or even years on credit reporting records. If you successfully got your lien withdrawn, you need to be proactive with the credit agencies: you should contact the agency directly with proof of the removal of your lien. The credit reporting agency has a legal duty to take that lien off of your report for good.
At North Suburban Legal Services LLC, our Illinois tax law attorneys have deep experience handling claims involving IRS liens. If you need help getting an IRS lien removed from your credit report, please do not hesitate to contact our legal team at (312) 909-6089 to request a free, no obligation consultation. From our office in Chicago, we serve communities throughout Northern Illinois, including in Will County, Kane County, Lake County, McHenry County, and Cook County.