Tax Lien Lawyers in Westminster
In Westminster, Maryland, a "lien" is a type of property right, which is created by a court to obtain payment of a lawful debt. Generally, 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 also put them "first in line" compared to other creditors, if the debtor files for bankruptcy.
In Westminster, Maryland, a "tax lien" is simply a lien imposed by the government to collect back taxes from a person or corporation, when other methods for collecting have failed.
However, a tax lien in Westminster, Maryland 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 Westminster, Maryland
The actual process of setting up a Westminster, Maryland tax lien is usually pretty simple. The agency responsible for collecting taxes must first determine that a tax lien is warranted, usually by finding that the debtor owes a significant amount of back taxes.
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 occurs, the IRS or Maryland tax agency will have significant rights against the taxpayer's property.
But, these rights are limited. In Westminster, Maryland, 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 Westminster, Maryland Tax Lien Lawyer Help?
If you receive notice from the federal government, or the government of Maryland that a tax lien has been imposed on your property, some pretty complicated legal issues are necessarily involved.
Accordingly, it's important that you hire a tax attorney in Westminster, Maryland 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.