A tax lien showing up on your credit or against your property can be one of the most devastating credit problems you can have. The IRS does not tend to be very flexible and they will take aggressive action to make sure that they are paid in full.
A tax lien showing on your credit will create havoc for you when you try to get new credit. You will definitely not be able to get a home mortgage and it will be difficult to get credit for car loans, student loans and even credit cards. Another problem is that even after you pay the tax lien off it can show on your credit report for as long as 7 years. If you don't pay it off it can show up for 15 years or longer.
In most cases you are better off trying to pay off the tax lien rather than fight it. Sometimes you can negotiate with the IRS and settle for a lesser amount but you can rarely get away with not paying them at all. The IRS will always find you and they will be after you until you pay them off or your die in which case they will still try to get their money from your estate. That is just the way it is. We've all heard about "death and taxes".
But after you do pay off the lien, whether by paying in full or negotiating, you need to do what you can to get the negative listing removed from your credit report. If you don't it can have a negative effect for up to 7 years and longer.
In order to get a tax lien removed from you credit report you must submit a dispute to the credit reporting agencies. Make sure you submit a duplicate dispute to all of the big three, TransUnion, Equifax and Experian. You have the right to dispute any unfair or misleading credit because of the Fair Credit Reporting Act. Learn about your rights and enforce them so that you can have peace in your financial future.
Under the Fair Credit Reporting Act, any consumer has the right to dispute any items that are listed on the report. False and inaccurate information is often reported on credit and if you have already paid a tax lien you can ask to have the negative listing removed from your credit. You need to do this so that you can start with a clean score and move on.
The credit reporting agencies are private, non-government enterprises that are in the business to make profits. Their profits come from compiling and selling your information and they do not have a priority to make sure that the information is correct. It is your responsibility to make sure that your credit report is accurate and your information is portrayed as positively as possible.
You can make an effort to repair your credit and get negative items removed either by hiring a professional credit repair company or by doing it yourself. Either way you are responsible for making sure that your credit report and credit scores are shown in the best possible light so it is smart to take steps to repair any discrepancies on your report including tax liens.
