Tax Lien Lawyers in Colchester
In Colchester, Connecticut, 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 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 Colchester, Connecticut.
However, like any other debt-collection method, a tax lien is worthless if the debtor has no substantial property on which a lien can be imposed. To get around this limitation, most tax liens in Colchester, Connecticut apply to after-acquired property (property acquired after the lien was created). Most other liens only apply to particular pieces of property, or property that the debtor owned at the time the lien went into effect.
Tax Lien Procedure in Colchester, Connecticut
Imposing a tax lien in Colchester, Connecticut is normally an uncomplicated process. Usually, the tax authorities simply have to make a decision that the taxpayer is delinquent in their taxes, and that imposing and enforcing a tax lien will actually be worth the effort.
They will then mail a document called a "notice and demand," which lets the taxpayer know that they owe money on their taxes, and that they have a given period of time (typically 10 days) to pay what they owe.
If the back taxes are not paid before the deadline is up, the lien will typically take effect immediately, with no further action by the IRS or Connecticut tax agency, giving them all the rights in your property that the law permits.
Nonetheless, if the federal government does not seek to enforce a tax lien in Colchester, Connecticut 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 Colchester, Connecticut Tax Lien Lawyer Help?
If you end up having a tax lien imposed on your property in Connecticut, you will probably have to deal with some fairly challenging legal issues, which might be complicated to a layperson.
Thankfully for you, tax lawyers in Colchester, Connecticut 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.