A federal tax lien is recorded in the county, stating that you owe an unpaid tax debt. Once an IRS tax lien is recorded, it is of record and may affect your credit score and ability to get favorable loans.
If you receive notice of an IRS tax lien, you have some options. It would be a good idea to visit with an IRS tax attorney who can help you decide what the right solution is for you.
Get the IRS to Withdraw the Lien – If the IRS agrees to withdraw the lien, it will be as though the lien was never filed at all. They will only withdraw the lien if you can show the IRS that they filed the lien in error. Additionally, if you enter into a fresh start repayment program with the IRS, they may withdraw the tax lien in some instances.
Get the IRS to Release the Lien – To have the IRS lien released means that it will no longer encumber your property. An IRS lien release, however, does not remove the information from your record, and your credit report can show that there was a lien for up to 10 years.
The IRS will release a tax lien once they have received payment in full of the tax obligation, if you settle with the IRS for a lesser amount or if you enter into an installment agreement to pay the full amount due. When you receive a copy of your release, you can notify the credit reporting agencies to update your credit reports.