Tax Lien Lawyers in Wood Ridge

A "lien" in Wood Ridge, New Jersey 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.

In Wood Ridge, New Jersey, 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.

Tax Liens in Wood Ridge, New Jersey are generally only effective if the taxpayer has a significant amount of property on which a lien can be placed. However, it's important to note that virtually any property, including that which is acquired after the lien is imposed, can be subject to a tax lien.

Tax Lien Procedure in Wood Ridge, New Jersey

The actual process of setting up a Wood Ridge, New Jersey 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 taxpayer is sent a letter with a "notice and demand," which informs the taxpayer that the IRS has determined that they owe back taxes, and that they have a short period of time (usually 10 days) to pay them without incurring a penalty.

If this 10-day period expires without payment, the tax lien arises automatically. Once this happens, the tax authorities in New Jersey have all the rights in the taxpayer's property that any other lien holder would have, including priority over competing creditors.

But, under federal law, there are limits to how tax liens can be enforced in Wood Ridge, New Jersey, and elsewhere. Generally, the IRS has 10 years to try and enforce a tax lien. If no effort is made to enforce a tax lien for 10 years, the lien is automatically lifted, and the lien holder loses all rights in it. This rule exists to ensure that the government collects its taxes in a reasonable time period, and it prevents valuable property (which could otherwise be contributing to the economy by being bought and sold) is not laded with a lien for an indefinite period of time.

How Can a Wood Ridge, New Jersey Tax Lien Lawyer Help?

If the federal government, or the government of New Jersey informs you that they intend to place a tax lien on your property, you will likely face some pretty complicated and daunting legal issues.

Luckily for you, tax lawyers in Wood Ridge, New Jersey are experts at dealing with matters such as these, and can make sure your rights are protected, and advise you on the best way to proceed, if you are facing the prospect of a tax lien.