Tax liens serve what purpose?

On Behalf of | Oct 20, 2017 | Tax Liens

Connecticut residents who are behind on their taxes may face legal claims from the Internal Revenue Service in an effort to collect. Tax liens are just one way that the IRS can hold assets hostage until tax debts are paid in full. What can be done when tax liens are filed?

People often fail to pay taxes because they lack the funds to do so. They may have other debts that they feel take priority. Unfortunately, the IRS will disagree with this thought process. Like other creditors, they believe that they are entitled to their money before anyone else. True or not, they are in the position to do something about it.

Liens are often tied to one particular asset; with tax liens, things work a little differently. The lien is tied to all of one’s assets. This can make it impossible to move forward financially until the debt is settled.

A tax lien is not something that can be filed without one’s knowledge. It generally happens only after several notices demanding payment have been sent. Even then, a notice stating a lien is being filed must also be sent. So, it is not something that just happens out of the blue.

The only way to really avoid tax liens is to make sure taxes are paid or payment plans are put in place. However, Connecticut residents who already have tax liens filed against them can take steps to minimize the consequences. An experienced tax attorney will be able to review the details of one’s case and provide guidance on the matter.

Source: FindLaw, “What Is a Tax Lien?“, Accessed on Oct. 20, 2017