Tax Lien Lawyers in Petal

A "lien" in Petal, Mississippi is a property right that a person or entity has in property owned by someone else, created by law, for the purpose of enforcing a debt. A lien gives its holder many rights in the property of another person, including the right to seize the proceeds of a sale of the property, and, if the debtor files for bankruptcy, the right to go to the front of the line among other creditors, making it more likely that the lien holder will collect something.

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 Petal, Mississippi 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 Petal, Mississippi 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. Evidently, this makes it quite a bit easier for the government to collect its taxes.

Tax Lien Procedure in Petal, Mississippi

The actual process of setting up a Petal, Mississippi tax lien is normally pretty simple. The agency responsible for collecting taxes must first determine that a tax lien is warranted, normally 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 happens, the IRS or Mississippi tax agency will have considerable rights against the taxpayer's property.

But, these rights are limited. In Petal, Mississippi, 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 Petal, Mississippi Tax Lien Lawyer Help?

If you receive notice from the federal government, or the government of Mississippi that a tax lien has been imposed on your property, some pretty complex legal issues are necessarily involved.

Thankfully, Petal, Mississippi 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.