Tax Lien Lawyers in Malvern
In Malvern, Arkansas, 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 Malvern, Arkansas tax authorities, to gather taxes that the property-owner has failed to pay.
Of course, a tax lien in Malvern, Arkansas 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 Malvern, Arkansas
The actual process of setting up a Malvern, Arkansas tax lien is typically pretty simple. The agency responsible for collecting taxes must first determine that a tax lien is warranted, typically by finding that the debtor owes a significant amount of back taxes.
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 Arkansas 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 Malvern, Arkansas 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.
How Can a Malvern, Arkansas Tax Lien Lawyer Help?
If you are notified by the government that you owe back taxes in Arkansas, and that they are going to pursue a tax lien to collect their money, things can get very intricate, quite quickly.
Luckily, Malvern, Arkansas tax attorneys can help. If you are facing the prospect of a tax lien, you should not hesitate to seek skilled legal advice, to ensure that your legal rights are protected.