- When you pay off a tax debt to the Internal Revenue Service, the property lien that the IRS placed on you will eventually be removed automatically. You should not have to do anything other than pay your bill to have the lien removed. The IRS will go through the necessary process to have your lien released for you so that you can own your property free and clear again. This will happen after the debt and any applicable interest is paid.
- In some cases, you can also get the tax lien removed if you start making direct debit installment payments with the IRS. The IRS allows taxpayers to set up installment agreements that are automatically debited out of their bank accounts. After you have made several payments in this manner, you can request that a lien be removed from your property. The IRS will make the decision on a case-by-case basis as to whether the lien should be removed.
- In some cases, you may be able to settle your tax debt for less than what you owe. This is known as an offer in compromise. With an offer in compromise, you essentially make an offer for what you can afford to pay for your taxes even though it is less than your total tax debt. When you have a tax lien against your property and the IRS accepts an offer in compromise, it will also remove the lien on your property.
- Local governments charge property taxes as a way to generate revenue. If a homeowner does not pay his property taxes, the county will issue a tax lien certificate to an investor. The investor essentially pays the taxes for the homeowner. Then when the homeowner comes up with enough money to pay his taxes, he must pay the investor back with interest. The homeowner cannot have the lien removed until the late taxes are paid off.
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