How to Fix Tax Liens

by Jennifer Allen ; Updated July 27, 2017

If you owe the federal or state government money in taxes, you may have a tax lien placed against your property by the government to ensure they receive the money. If you want to purchase or sell your property, it may be impossible to do so if the government has placed a tax lien against you. There are ways you can fix the tax liens so that they do not affect your current or future plans with your property.

How to Fix Tax Liens

Step 1

Pay your tax liability in full—this is the fastest method to fix tax liens. When the tax lien is paid in full, the government must release its lien in your property.

Step 2

Contact the IRS and discuss payment arrangements by visiting their website at www.IRS.gov or by calling 1-800-829-1040. If your state government has a tax lien against you, you will need to check with your State Department of Revenue. Access the individual contact numbers for each state at http://www.IRS.gov/taxpros/article/0,,id=100236,00.html.

Step 3

Ask for an Offer in Compromise. This proposal is a tax settlement agreement between you and the IRS where you pay a portion of the tax liability and the IRS agrees not to pursue the remaining balance. Download forms 656 or 656-L at www.IRS.gov.

Step 4

Sell or refinance your property. When you sell it or refinance it, the tax lien will have to be paid or settled. The settlement agent handling the sell or refinance will handle submitting the money to the IRS so that the tax lien can be satisfied.

About the Author

Jennifer Allen obtained her Bachelor of Arts in economics and a Bachelor of Arts in political science, and has worked in finance since May 2006. She completed her Master of Arts in human resource management in December 2009. Allen has written a variety of articles that are published on various websites.