Tax Lien Lawyers in Sioux Center
In Sioux Center, Iowa, a "lien" is a security interest placed on a piece of property, normally land or a house, to secure the payment of a debt. It typically 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 simply a lien that is established for the particular purpose of collecting taxes from a delinquent tax payer in Sioux Center, Iowa.
However, a tax lien in Sioux Center, Iowa 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. Nonetheless, a tax lien can be applied to property that the taxpayer gains after the lien goes into effect.
Tax Lien Procedure in Sioux Center, Iowa
In Sioux Center, Iowa, the process for creating a tax lien is fairly uncomplicated. First, the tax authorities decide that a taxpayer really owes taxes that they haven't paid (that they're delinquent in their taxes).
At this point, they will send the taxpayer a written notice stating that they owe a some amount of money in back taxes, and that they have a small window of time (commonly 10 days or less) to pay it.
If this 10-day period expires without payment, the tax lien arises automatically. Once this happens, the tax authorities in Iowa have all the options in the taxpayer's property that any other lien holder would have, containing priority over competing creditors.
But, these rights are limited. In Sioux Center, 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." Additionally, it acknowledges the fact that any encumbrance on a piece of property, such as a lien, makes the property less valuable. By guaranteeing that the lien will either be satisfied or expire within 10 years, this prevents property from being withheld from the stream of commerce forever.
How Can a Sioux Center, Iowa Tax Lien Lawyer Help?
If you are notified by the government that you owe back taxes in Iowa, and that they are going to pursue a tax lien to collect their money, things can get very difficult, extremely quickly.
Thankfully, Sioux Center, Iowa tax attorneys can help. If you are facing the prospect of a tax lien, you should not hesitate to seek qualified legal advice, to ensure that your legal rights are protected.