Tax Liens in Warren, Arkansas
In Warren, Arkansas, 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 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 Warren, Arkansas tax authorities, to collect taxes that the property-owner has failed to pay.
However, like any other debt-collection method, a tax lien is worthless if the debtor has no significant property on which a lien can be imposed. To get around this limitation, most tax liens in Warren, Arkansas apply to after-acquired property (property obtained after the lien was created). Most other liens only apply to specific pieces of property, or property that the debtor owned at the time the lien went into effect.
Tax Lien Procedure in Warren, Arkansas
The process of imposing a tax lien on property in Warren, Arkansas is usually fairly simple. The first step is for the IRS or local tax agency to determine that a person actually owes back taxes, and that it is worth the effort to impose a lien.
Then, the IRS, or state tax authorities, send a "notice and demand," informing the taxpayer that they owe back taxes, and that they are required to pay their taxes within 10 days.
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.
But, under federal law, there are limits to how tax liens can be enforced in Warren, Arkansas, 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 Warren, Arkansas Tax Lien Lawyer Help?
If you receive notice from the federal government, or the government of Arkansas that a tax lien has been imposed on your property, some pretty complicated legal issues are necessarily involved.
Accordingly, it's important that you hire a tax attorney in Warren, Arkansas 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.