Tax Lien Lawyers in Fort Madison
In Fort Madison, Iowa, 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 simply a lien that is created for the specific purpose of collecting taxes from a delinquent tax payer in Fort Madison, Iowa.
Tax liens in Fort Madison, Iowa are ineffective if the taxpayer doesn't have any property to place the lien on. However, virtually any property, including that which the taxpayer obtains after the lien goes into effect, can be affected by a tax lien.
Tax Lien Procedure in Fort Madison, Iowa
Imposing a tax lien in Fort Madison, Iowa 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.
Then, the IRS, or state tax authorities, send a "notice and demand," informing the taxpayer that they owe back taxes, and that they are required to pay their taxes within 10 days.
If that time period expires, and the debtor still hasn't paid, the Iowa tax lien will go into effect automatically, with no further action required.
But, these rights are limited. In Fort Madison, Iowa, and everywhere else in the United States, the IRS has 10 years to enforce a tax lien. If they do nothing about it within 10 years, the lien expires. This rule exists for a few reasons. First, it encourages the IRS to act as quickly and efficiently as possible, and not "sit on its rights." Second, it acknowledges the fact that any encumbrance on a piece of property, such as a lien, makes the property less valuable. By ensuring that the lien will either be satisfied or expire within 10 years, this prevents property from being withheld from the stream of commerce indefinitely.
How Can a Fort Madison, Iowa Tax Lien Lawyer Help?
If the federal government, or the government of Iowa 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 Fort Madison, Iowa 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.