Tax Lien Removed from Credit Report

By
Mortgage and Lending

Tax Lien Removed from Credit Report

IRS has announced a new policy that will significantly reduce the number of tax liens on properties owned by delinquent taxpayers. The IRS has raised the minimum amount of tax debts that prompts the filing of a tax lien from $5000 to $10000, and for those owing $25000 or less, the IRS will make it easier to obtain lien withdrawals once a taxpayer pays off the debt or sets up a payment plan that end in full repayment. Also the procedure is streamlined so it can be removed from your credit report faster (not instant, but faster).

CPA’s can implement this, so no court filing is needed. The only way this can be done by requesting the withdrawal to the IRS in writing after fully paying or agreeing to direct debit installment agreement. Liens will be withdrawn after probationary period demonstrating that he/she is capable of direct debit payments will be honored.

Under the new policy the borrower’s credit report will be wiped clean and his credit report improved. It can increase the borrower’s credit score by more than 100 points, which can significantly alter someone getting a loan and saving thousands of dollars in monthly mortgage payments.

If a client settles for less then what the full debt owed is, they will not be eligible for the withdrawal of lien. Recheck your credit within 30 days to make sure the bureaus have updated the new IRS information on the credit profile. If it still shows up, an accountant should seek out a credit restoration company to get the lien removed.

 

                                               

Comments (3)

Nancy Pav
Century 21 Redwood Realty - Ashburn, VA
Nancy Pav, Your "GottaHave" Realtor

Great info, thanks for sharing!

Aug 17, 2011 05:04 AM
Rachel Dunn
Keller Williams Realty® - Round Rock, TX
Productivity Coach & Realtor®

Thank you for the great information. This will be a great help to many people.

Aug 17, 2011 05:04 AM
Dave Sullivan
Real Estate One - Birmingham, MI
Michigan Realtor with an investor viewpoint

The IRS will now REMOVE a tax lien from your credit report "if requested by the tax payer" when payment in full is made. As opposed to showing it as a paid tax lien for seven years and then aging off. Once paid, It will be removed off the report like it was never there. But it gets better, watch my video on how to get it removed before you pay it off. You should have been sent that when the lien was established... you would get that form from the agency (IRS) that filed the lien, I hope that helps I can do some more digging on it if you like. If you request another copy please post what you learned here.

Apr 05, 2012 04:18 AM