Tax Liens in Phenix City, Alabama
In Phenix City, Alabama, a "lien" is a security interest placed on a piece of property, typically land or a house, to secure the payment of a debt. It usually 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 proceeds 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 Phenix City, Alabama tax authorities, to gather taxes that the property-owner has failed to pay.
Of course, a tax lien in Phenix City, Alabama isn't worth much more than the paper it's printed on if the debtor doesn't own any property of value, on which a lien could be placed. However, a tax lien applies to property that the taxpayer obtains even after the lien is created. Apparently, this makes it quite a bit easier for the government to collect its taxes.
Tax Lien Procedure in Phenix City, Alabama
In Phenix City, Alabama, the procedure for imposing a tax lien is relatively simple. First, the IRS makes a determination that a person is delinquent in their tax obligation.
At this point, the taxpayer will receive a letter containing a "notice and demand," which, as the name suggests, gives notice that the recipient owes taxes, and demands immediate payment. It will typically give the taxpayer about 10 days to pay the demanded amount.
If the deadline passes without payment, most tax liens in Alabama take effect automatically, giving the tax collectors all of the rights in your property that any other lien holder would have.
However, if the federal government does not seek to enforce a tax lien in Phenix City, Alabama within 10 years of imposing it, federal law dictates that the lien automatically expires. This is effectively a statute of limitations on a tax lien, meant to encourage the federal government to collect its taxes in a reasonable period of time, and ensure that property is not encumbered by a lien forever.
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How Can a Phenix City, Alabama Tax Lien Lawyer Help?
If the federal government, or the government of Alabama informs you that they intend to place a tax lien on your property, you will likely face some pretty intricate and daunting legal issues.
Accordingly, it's important that you contact a tax attorney in Phenix City, Alabama to ensure that whatever legal rights you have in this situation are protected. Your attorney will also be able to advise you on how to best deal with the situation.