Tax Liens in El Dorado County, California
In El Dorado County, California, 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.
A "tax lien," then, is a lien held by the government to collect a tax-related debt from a private entity, such as a person or corporation in El Dorado County, California.
Tax liens in El Dorado County, California are ineffective if the taxpayer doesn't have any property to place the lien on. However, essentially any property, including that which the taxpayer obtains after the lien goes into effect, can be affected by a tax lien.
Tax Lien Procedure in El Dorado County, California
Imposing a tax lien in El Dorado County, California is normally an uncomplicated process. Usually, the tax authorities simply have to make a determination that the taxpayer is delinquent in their taxes, and that imposing and enforcing a tax lien will actually be worth the effort.
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 this 10-day period expires without payment, the tax lien arises automatically. Once this happens, the tax authorities in California have all the rights in the taxpayer's property that any other lien holder would have, including priority over competing creditors.
However, in El Dorado County, California, and anywhere else in America, a tax lien only lasts for 10 years, and then it automatically expires. If the IRS fails to exercise the substantial rights that it has under a tax lien within that period of time, it is assumed that they never intend to do so, and the lien will cease to exist. This ensures that valuable property is only kept out of the economy for a narrow period of time.
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How Can a El Dorado County, California Tax Lien Lawyer Help?
If you are notified by the government that you owe back taxes in California, and that they are going to pursue a tax lien to collect their money, things can get very intricate, quite quickly.
Accordingly, if you think that any piece of property you own might become subject to a tax lien in El Dorado County, California, you should not hesitate to seek the advice of a skilled tax attorney immediately.