Tax Lien Lawyers in Frederick

In Frederick, 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 Frederick, 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 Frederick, 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 Frederick, Colorado

In Frederick, Colorado, the process for creating a tax lien is fairly uncomplicated. First, the tax authorities decide that a taxpayer actually owes taxes that they haven't paid (that they're delinquent in their taxes).

Then, the IRS, or state tax authorities, send a "notice and demand," informing the taxpayer that they owe back taxes, and that they are obligated to pay their taxes within 10 days.

If the back taxes are not paid before the deadline is up, the lien will usually take effect immediately, with no further action by the IRS or Colorado tax agency, giving them all the rights in your property that the law allows.

But, under federal law, there are limits to how tax liens can be enforced in Frederick, Colorado, 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.

How Can a Frederick, 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.

Therefore, it's important that you hire a tax attorney in Frederick, Colorado to ensure that whatever legal rights you have in this situation are defended. Your attorney will also be able to advise you on how to best deal with the situation.