Tax Lien Lawyers in Cortez

In Cortez, Colorado, 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 funds 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 citizen or corporation in Cortez, Colorado.

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 Cortez, Colorado apply to after-acquired property (property acquired 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 Cortez, Colorado

In Cortez, Colorado, the procedure for imposing a tax lien is relatively simple. First, the IRS makes a decision that a person is delinquent in their tax requirement.

Then, the taxpayer is sent a letter with a "notice and demand," which informs the taxpayer that the IRS has decided that they owe back taxes, and that they have a short period of time (usually 10 days) to pay them without incurring a penalty.

If this deadline expires, and the debtor does not pay the taxes they owe, the lien will take effect automatically. When this occurs, the IRS or Colorado tax agency will have significant rights against the taxpayer's property.

Nonetheless, if the federal government does not seek to enforce a tax lien in Cortez, Colorado 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 guarantee that property is not encumbered by a lien forever.

How Can a Cortez, Colorado Tax Lien Lawyer Help?

If you find yourself on the receiving end of a tax lien in Colorado, you are going to have to wade through some substantial and perplexing legal issues.

Fortunately, Cortez, Colorado tax attorneys can help. If you are facing the prospect of a tax lien, you should not hesitate to seek competent legal advice, to ensure that your legal rights are protected.