Tax Lien Lawyers in West Melbourne
In West Melbourne, Florida, 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.
In West Melbourne, Florida, a "tax lien" is simply a lien imposed by the government to gather back taxes from a person or corporation, when other methods for collecting have failed.
However, a tax lien in West Melbourne, Florida will be ineffective if the debtor doesn't own any valuable property to encumber with a lien. As with any debt, the creditor can't collect if the debtor doesn't have any assets. However, a tax lien can be applied to property that the taxpayer acquires after the lien goes into effect.
Tax Lien Procedure in West Melbourne, Florida
The actual process of setting up a West Melbourne, Florida tax lien is typically pretty simple. The agency responsible for collecting taxes must first determine that a tax lien is warranted, typically by finding that the debtor owes a significant amount of back taxes.
Then, the taxpayer is sent a letter with a "notice and demand," which informs the taxpayer that the IRS has determined that they owe back taxes, and that they have a short period of time (typically 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 Florida have all the rights in the taxpayer's property that any other lien holder would have, including priority over competing creditors.
But, under federal law, there are limits to how tax liens can be enforced in West Melbourne, Florida, 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 West Melbourne, Florida Tax Lien Lawyer Help?
If the federal government, or the government of Florida 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 West Melbourne, Florida 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.