Tax Liens in Lathrop, California
In Lathrop, California, a "lien" is a security interest placed on a piece of property, normally land or a house, to secure the payment of a debt. It typically 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 Lathrop, California.
Tax liens in Lathrop, California are ineffective if the taxpayer doesn't have any property to place the lien on. However, virtually 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 Lathrop, California
The actual process of setting up a Lathrop, California tax lien is normally pretty simple. The agency responsible for collecting taxes must first determine that a tax lien is warranted, normally 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 normally give the taxpayer about 10 days to pay the demanded amount.
If the deadline passes without payment, most tax liens in California take effect automatically, giving the tax collectors all of the rights in your property that any other lien holder would have.
However, in Lathrop, 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 certain period of time.
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How Can a Lathrop, California Tax Lien Lawyer Help?
If the federal government, or the government of California informs you that they intend to place a tax lien on your property, you will likely face some pretty convoluted and daunting legal issues.
Fortunately for you, tax lawyers in Lathrop, California are experts at dealing with matters such as these, and can make sure your rights are protected, and advise you on the best way to proceed, if you are facing the prospect of a tax lien.