Tax Lien Lawyers in Urbana
In Urbana, Illinois, a "lien" is a type of property right, which is created by a court to obtain payment of a lawful debt. Usually, a valid lien gives its holder the right to seize the property subject to it, or at least some of the property's equity, to satisfy the debt. If the owner sells a piece of property that's subject to a lien, the creditor who owns the lien may be entitled to the proceeds, up to the amount you owe them. It can additionally put them "first in line" compared to other creditors, if the debtor files for bankruptcy.
A "tax lien" is simply a lien placed on a piece of property by the state or local government, to secure the payment of back taxes. A tax lien in Urbana, Illinois can arise to secure the payment of any federal or state tax, including income tax, estate tax, or gift tax.
Of course, a tax lien in Urbana, Illinois isn't worth much more than the paper it's printed on if the debtor doesn't own any property of value, on which a lien could be placed. However, a tax lien applies to property that the taxpayer obtains even after the lien is created. Apparently, this makes it quite a bit easier for the government to collect its taxes.
Tax Lien Procedure in Urbana, Illinois
The process of imposing a tax lien on property in Urbana, Illinois is typically fairly simple. The first step is for the IRS or local tax agency to determine that a person truly owes back taxes, and that it is worth the effort to impose a lien.
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 this deadline expires, and the debtor does not pay the taxes they owe, the lien will take effect automatically. When this results, the IRS or Illinois tax agency will have substantial rights against the taxpayer's property.
But, these rights are limited. In Urbana, Illinois, 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." Furthermore, 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 Urbana, Illinois Tax Lien Lawyer Help?
If you end up having a tax lien imposed on your property in Illinois, you will probably have to deal with some fairly challenging legal issues, which might be complex to a layperson.
Luckily, Urbana, Illinois tax attorneys can help. If you are facing the prospect of a tax lien, you should not hesitate to seek skilled legal advice, to ensure that your legal rights are protected.