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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 15301
Experience:  15years with H & R Block. Divisional leader, Instructor
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I was just approved IRS installment agreement, then they

Customer Question

I was just approved for an IRS installment agreement, then they filed a federal tax lien against me in the county. 1) Aren't installment agreements supposed to prevent liens? 2) Can they seize money in my accounts? 2) Can they do anything to my internet based web design business? What usually happens?
Submitted: 1 year ago.
Category: Tax
Expert:  Robin D. replied 1 year ago.


No, installment agreements do not prevent liens. A federal tax lien is the government’s legal claim against your property when you neglect or fail to pay a tax debt. The lien protects the government’s interest in all your property, including real estate, personal property and financial assets.

The IRS may allow withdrawal of your Notice of Federal Tax Lien if you have entered in or converted your regular installment agreement to a Direct Debit installment agreement. General eligibility includes:

  • You are a qualifying taxpayer (i.e. individuals, businesses with income tax liability only, and out of business entities with any type of tax debt)
  • You owe $25,000 or less (If you owe more than $25,000, you may pay down the balance to $25,000 prior to requesting withdrawal of the Notice of Federal Tax Lien)
  • Your Direct Debit Installment Agreement must full pay the amount you owe within 60 months or before the Collection Statute expires, whichever is earlier
  • You are in full compliance with other filing and payment requirements
  • You have made three consecutive direct debit payments
  • You can’t have defaulted on your current, or any previous, Direct Debit Installment agreement.

As long as you pay on time the IRS does not take collection action (like seizing your account).

What usually happens is you pay off the tax owed and the IRS removes the lien. The lien is just to make sure that if you do not pay they can take action to receive the remaining amount.

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Customer: replied 1 year ago.
2) Can the seize my bank accounts or retirement in any way? 3) Can they mess up my digital website design business? 4) Can the seize my car? .....what are the most likely possibilities?
Customer: replied 1 year ago.
Expert:  Robin D. replied 1 year ago.

Yes, if you do not pay they can.

The IRS only takes collection action if you do not honor the installment agreement.

Yes they could take your car and if the business is sole proprietor yes they could take the assets of the business BUT

only if you do not stick to the agreement.

Expert:  Robin D. replied 1 year ago.

Checking to see how you responded