Tax Lien Lawyers in Monument

In Monument, 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 Monument, 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 Monument, 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 Monument, Colorado

In Monument, 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 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 10-day period expires without payment, the tax lien arises automatically. Once this happens, the tax authorities in Colorado have all the options in the taxpayer's property that any other lien holder would have, containing priority over competing creditors.

But, under federal law, there are limits to how tax liens can be enforced in Monument, 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 Monument, Colorado Tax Lien Lawyer Help?

If the federal government, or the government of Colorado informs you that they intend to place a tax lien on your property, you will likely face some pretty perplexing and daunting legal issues.

Luckily for you, tax lawyers in Monument, Colorado are experts at dealing with matters such as these, and can make sure your rights are safeguarded, and advise you on the best way to proceed, if you are facing the prospect of a tax lien.