Tax Lien Lawyers in Naugatuck
In Naugatuck, 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 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 Naugatuck, 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 Naugatuck, Connecticut apply to after-acquired property (property obtained 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 Naugatuck, Connecticut
Imposing a tax lien in Naugatuck, Connecticut is normally an uncomplicated process. Usually, the tax authorities simply have to make a determination that the taxpayer is delinquent in their taxes, and that imposing and enforcing a tax lien will actually be worth the effort.
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 typically give the taxpayer about 10 days to pay the demanded amount.
If that time period expires, and the debtor still hasn't paid, the Connecticut tax lien will go into effect automatically, with no further action required.
But, under federal law, there are limits to how tax liens can be enforced in Naugatuck, Connecticut, and elsewhere. Usually, 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 Naugatuck, Connecticut Tax Lien Lawyer Help?
If the federal government, or the government of Connecticut informs you that they intend to place a tax lien on your property, you will likely face some pretty intricate and daunting legal issues.
Accordingly, it's important that you contact a tax attorney in Naugatuck, Connecticut to ensure that whatever legal rights you have in this situation are protected. Your attorney will also be able to advise you on how to best deal with the situation.