Remove Tax Lien
January 10, 2009 – 7:46 pmby Matt Douglas
If you have a tax lien on your credit report, you should take immediate action to remove it. This is a very bad mark and will lower your score considerably.
The first step is to have the bureaus validate the lien. You need to send each bureau a dispute letter.
Unfortunately mistakes do happen on your report; there are estimates that 1 in 4 people have an error on their report.
When your letter is received then the bureau will contact the state or federal government and ask them to verify the debt. If it is verified then you will have to negotiate payment to remove it.
Depending on the amount you owe it may be in your interest to contact a tax negotiator. This is because they can often negotiate a reduced payment for you. However you can also negotiate directly with the government.
These debts are collectible for 10 years. The negative mark will stay on your credit for 7 years once it is paid. If it goes unpaid you could have a lien on your report for a long time.
However once you pay in full, wait three months and dispute the mark again. It has been learned that frequently the government will ignore future validation requests from the bureaus once a lien is paid.
This means that the negative mark will be removed from your report if it is not verified. However if this mark is a mistake and not your debt you should demand immediate proof and send any documentation to show this.
Repayment
The state and federal government are willing to negotiate and settle on a reduced payment. It is called an OIC (offer in compromise), this just means that the government is accepting partial payment.
The government will decide to accept based on; your income, assets, ability to repay, expected amount they will recover. It can help if you send in a letter explaining your financial hardship that led up to this.
It may be in your interest to hire a tax attorney or negotiator to help negotiate a repayment amount. It is not absolutely necessary but nonetheless a good idea.
In sum, you can remove a tax lien and other negative marks from your credit report. You do not just have to live with bad credit.
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Tags: Business, business and finance, credit, credit repair, credit tips, debt, debt advice, debt tips, Finance, how-to, Legal, money, personal finance, tax
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