Tax Liens in Fort Payne, Alabama
In Fort Payne, Alabama, a "lien" is a security interest placed on a piece of property, usually land or a house, to secure the payment of a debt. It generally gives a creditor the right to take ownership of any equity that exists in the property, to secure the payment of the debt. If the owner sells the property, the creditor may also be entitled to the funds of the sale, up to the amount owed. It can also give the holder of the lien a higher priority status, giving them an advantage over competing creditors, if the debtor files bankruptcy.
As you might have gathered, a "tax lien" is simply a lien placed on property by the IRS or Fort Payne, Alabama tax authorities, to collect taxes that the property-owner has failed to pay.
However, a tax lien in Fort Payne, Alabama will be ineffective if the debtor doesn't own any valuable property to encumber with a lien. As with any debt, the creditor can't collect if the debtor doesn't have any assets. Nonetheless, a tax lien can be applied to property that the taxpayer gains after the lien goes into effect.
Tax Lien Procedure in Fort Payne, Alabama
The actual process of setting up a Fort Payne, Alabama tax lien is usually pretty simple. The agency responsible for collecting taxes must first decide that a tax lien is warranted, usually by finding that the debtor owes a significant amount of back taxes.
Then, the IRS, or state tax authorities, send a "notice and demand," informing the taxpayer that they owe back taxes, and that they are obligated to pay their taxes within 10 days.
If the deadline passes without payment, most tax liens in Alabama take effect automatically, giving the tax collectors all of the options in your property that any other lien holder would have.
But, under federal law, there are limits to how tax liens can be enforced in Fort Payne, Alabama, and elsewhere. Generally, the IRS has 10 years to try and enforce a tax lien. If no effort is made to enforce a tax lien for 10 years, the lien is automatically lifted, and the lien holder loses all rights in it. This rule exists to ensure that the government collects its taxes in a reasonable time period, and it prevents valuable property (which could otherwise be contributing to the economy by being bought and sold) is not laded with a lien for an indefinite period of time.
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How Can a Fort Payne, Alabama Tax Lien Lawyer Help?
If you end up having a tax lien imposed on your property in Alabama, you will probably have to deal with some fairly difficult legal issues, which might be intricate to a layperson.
Luckily for you, tax lawyers in Fort Payne, Alabama are experts at dealing with matters such as these, and can make sure your rights are safeguarded, and advise you on the best way to proceed, if you are facing the prospect of a tax lien.