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I have a federal tax lien filed 2015 with 2 assessment dates…

I have a federal tax...
I have a federal tax lien filed 2015 with 2 assessment dates in 2008 and 2009. you told me the both expire 2018 and 2019 respectively. how do I obtain an early release from the lien? I would like to purchase a home but unable to because of the lien.
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1/19/2018
Tax.appeal.168
Tax.appeal.168, Tax Accountant
Category: Tax
Satisfied Customers: 4,641
Experience: 3+ decades of varied tax industry exp. Tax Biz owner
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Hello. Thank you for choosing this Q&A service for assistance. My name is***** will be assisting you. Providing that the statute of limitations has not been extended, 10 years is the collection time period. SEE BELOW:

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Duration of the Federal Tax Lien

  1. The federal tax lien continues until the liability for the amount assessed is satisfied or becomes unenforceable by reason of lapse of time, i.e., passing of the collection statute expiration date (CSED). IRC § 6322. Generally, after assessment, the Service has ten years to collect the tax liability. IRC § 6502. However, there are some circumstances which may extend or suspend the ten-year collection period.

  2. IRC § 6502 provides for an extension of the collection period in two situations:

    REFERENCE SOURCE:

    https://www.irs.gov/irm/part5/irm_05-017-002

    --------------------------------------------

    Still writing...

    1. The statute of limitations was extended at the same time an installment agreement was entered into. In this case, collection action may be taken until the 89th day after expiration of the installment agreement. IRC § 6502(a)(2)(A).

      Note:

      The Service only secures extensions on partial payment installment agreements and only in limited situations. See IRM 5.14.2.1.3.

    2. Release of a levy under IRC § 6343 is accompanied by an agreement to extend the statute of limitations to a specific date and that date has not yet passed. IRC § 6502(a)(2)(B); Treas. Reg. §(###) ###-####1(b)(2)(ii)(D).

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In brief, you cannot request an early release of the lien. You can request that the lien be withdrawn, however, you would need to be on a direct be on a direct debit installment agreement to request the lien be withdrawn. Refer to form 12277 for more detailed information relating to this matter.

Link to Form 12277:

https://www.irs.gov/pub/irs-pdf/f12277.pdf

There are other options of getting a lien removed, however, it doesn't appear that they apply to your situation. Refer to the following link for more detailed information.

https://www.irs.gov/businesses/small-businesses-self-employed/understanding-a-federal-tax-lien

-------------------------------

In closing, if you do not require further assistance with this matter, I ask that you please take the time to positively rate my response (3 or more stars) so that I can receive credit for assisting you. A 5 star rating is greatly appreciated. Thank you in advance.

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Customer reply replied 4 months ago
I just began an installment agreement to pay 93/mo. Does that affect when the lien/assessment is released (10 years) after assessment date of 2008 and other 2009?

According to the information provided to you previously, yes it does. SEE BELOW:

--------------------------

The statute of limitations was extended at the same time an installment agreement was entered into. In this case, collection action may be taken until the 89th day after expiration of the installment agreement. IRC § 6502(a)(2)(A).

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Customer reply replied 4 months ago
How do I know the expiration of the installment agreement? The amount was previously uncollectable in 2015, then reevaluated in June 2017 and an installment agreement was made. I have not yet begun making payments due to hurricane Irma disaster area. 1st payment is due 2/18/2018
Customer reply replied 4 months ago
With payments of $93/mo the amount now owed is over 100K and will never be satisfied.

Honestly, I am surprised that they even accepted that amount considering the balance owed. My thought is that they accepted that amount so that they can extend the collection period, unknowingly to you, of course. You will need to contact the IRS and speak with one of their people to find out when the expiration of the installment agreement is. Call 1-***-***-****. Be prepared to be on hold for a long period of time.

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Customer reply replied 4 months ago
is the date on the agreement? they never required me to sign it or send it back

There are various types of agreements that can be for different time frames. I am going to say that the date is not on the agreement. You can refer to the following link to review the different type of agreements.

https://www.taxdefensenetwork.com/blog/types-of-irs-installment-agreements/

---------------------------------------

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Customer reply replied 4 months ago
I appreciate you info. What affect on the tax lien or installment agreement or collection period have if the tax periods in question were based on the irs filing the tax return for me because it was unfiled by me?
Customer reply replied 4 months ago
what affect on the collection period be if i defaulted on the installment agreement?

When the IRS files a return for the taxpayer (SFR)...there is no statue of limitations on the collection period.

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Customer reply replied 4 months ago
Does that mean that the assessment date and the 10 year time frame is meaningless?
Customer reply replied 4 months ago
each return was filed by the irs on the lien
Customer reply replied 4 months ago
if I refiled the return what affect would that have. I know that the returns were wildly inaccurate but at the time I was desperate for relief from pending wage levy.

The unfiled return or returns is likely why your balance is so high. When the IRS files a return for an individual, other than the standard deduction, no other deductions or exemptions. SEE BELOW:

---------------------------------------

Sometimes, when you don’t file a return, the IRS files one for you. In IRS-speak, this is called a Substitute for Return (sometimes known as an SFR). Most times, an IRS substitute for return gets it wrong, charging you for income that was reported on W2s and 1099s but not giving you any deductions or exemptions. You may already have a bill from the IRS from a Substitute for Return. These estimated returns can be corrected – and the tax lowered – by filing an original return.

REFERENCE SOURCE:

https://howardlevyirslawyer.com/2013/01/26/unfiled-tax-returns-how-to-make-it-right-with-the-irs/

--------------------------------

Q1: Does that mean that the assessment date and the 10 year time frame is meaningless?

A2: Yes, because the return was not filed. The 10 years SOL period is the general time frame for individuals who have filed their tax return.

--------------------------------

Q2: if I refiled the return what affect would that have.

A2: You would not be refiling because you never filed the returns to begin with. As so many years has passed, I am not sure if filing the returns for those years is going to make a difference. However, you can certainly file those years and see if the IRS will accept them.

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Based on the following information, you can file back as far as you like.

-------------------------------

The IRS requires that you file a tax return for every year that you are eligible. Accordingly, you can file as far back in time as you'd like. So if you were required to file a tax return in 1994, but just didn't realize you were supposed to, it's still not too late to fix it. However, the IRS is most concerned with tax records over the last seven years. This means that filing any returns that were due in the period extending back seven years from today should be a priority. In most cases it's best to act sooner rather than later. If you were owed a refund on any of those prior year tax returns, you can only collect it if you file the return within three years of the original tax deadline. Keep in mind that the IRS will expect you to pay any amount you owe.

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Customer reply replied 4 months ago
in your experience, in partial installment payment is the expiration date normally longer than statute of limitations.? In answer A2, If I filed a return for 2005 that IRS filed the SFR and tax liability was reduced, would there be a new assessment date and reduction of interest and penalties? How will that new filing affect the lien if the amount assessed is lower?

Regarding your last thread, you would have to ask the IRS that. As there are different factors that can come into play, I am unable to provide you with definitive information.

------------------------------------

A positive rating of 3 or more stars is appreciated. Thank you in advance

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Customer reply replied 4 months ago
What affect of me filing chapter 7 bankruptcy have on my tax liability and what I owe to IRS?

Respectfully, ***** ***** point, I am not going to have an endless conversation. I am going to opt out and release the question back into the question queue. I provided you with information relating to your initial inquiry. Since that inquiry, you've asked me about a few other matters. I have really spent more time on this matter than I would prefer to have spent. Have a good day.

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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 14,201
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

Hi Different expert here. My name's Lane

...

I hold a law degree (J.D.), with concentration in Tax Law, Estate law & Corporate law, an MBA in finance, a BBA, and CFP & CRPS (Chartered Retirement Plans Specialist) designations, as well - I’ve been providing financial, Social Security/Medicare, estate, corporate, non-profit, and tax advice, to clients on three continents, since 1986.

Bear with me a moment while I type up my response. Then if you have further questions we can go from there.

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First, please understand that are only compensated when you rate. and we can only be rated once per question

...

So every time I return to this same question thread to answer a different question, my compensation per time/effort is lowered.

...

I would respectfully ***** ***** you ask new questions AS new questions. They don't cost those with subscriptions any more money, but again, each new question on the same question thread costs me money.

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Relief from tax debts in Chapter 7 bankruptcy can happen if you meet the following requirements:

...

  • The taxes are income-based. Income taxes are the only kind of debt that Chapter 7 is able to discharge. The tax debt must be for federal or state income taxes or taxes on gross receipts.

...

  • The return was due at least three years ago. The taxes must be from a tax return that was due (including all valid extensions) at least three years before you filed for bankruptcy. For example, if taxes were disclosed in a 2005 income tax return for which extensions to file the return expired on October 15, 2006, the tax return due date test will be satisfied if the bankruptcy petition is filed after October 15, 2009.

...

  • You filed the return at least two years ago. You must have filed the tax return at least two years before filing for bankruptcy. In most courts, a late return does not count as a "return" and you won't be able to discharge the taxes (late means your extensions have expired and the IRS filed a substitute return on your behalf). In other courts, you can discharge tax debt even if you file a late return, assuming you meet the other criteria.

...

  • The taxes were assessed at least 240 days ago. The taxing authority must have assessed the tax (entered the liability on the taxing authority’s records) against you at least 240 days before you filed for bankruptcy. This time limit may be extended if there was an offer in compromise between the taxing authority and you or if you had previously filed for bankruptcy.

...

  • No fraud or willful evasion. The tax return must not be fraudulent or frivolous and the you cannot be guilty of any intentional act of evading the tax laws. If you file a joint return, the taxing authority must prove that both you and your spouse committed an act of fraud related to the applicable return or willfully attempted to evade the tax in order for the court to deny the discharge of the tax debt.
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HOWEVER, there are some exceptions to this:

...

Even though a Ch. 7 discharge of income taxes wipes out your obligation to pay the tax and prevents the taxing authority from going after your bank account or wages, there's one thing you should be aware of.

...

However, tax liens, sometimes called secured taxes, stay attached to your property. (applies only to tax liens recorded against your property before you file for bankruptcy). This means that even though you're not liable for the tax debt, you'll have to pay the lien from any profits when you sell the property They do this to protect their interest.

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An I've looked back through that tome of a conversation you had with the other expert. Everything there is spot on.

...

What you have is called a partial pay installment agreement. They do this sometimes just to keep you from ever going into Non-Collectible status OR reaching the CSED (Collection Statute Expiration Date).

...

Here are the things that toll (stop the clock) on the CSED

...

Leave the Country If you are thinking about leaving the country for a few years to allow the clock to run…think again. The CSED stops running while you are away. You may ask – how will the IRS know that I’m gone? It knows because it shares info with Customs and Homeland Security.

...

Bankruptcy Filing The CSED is tolled while you are in the case whether a chapter 7 or chapter 13. So if the debt isn’t discharged in the bankruptcy, it will be waiting and it will be waiting at the same spot on the clock as it was when you started.

...

IRS Offer In Compromise If you think the IRS collection department or the IRS Revenue Officer is encouraging you to file an Offer in Compromise because you are a good candidate for one, you are probably mistaken. Filing an offer allows the IRS to see all of your financial history and it stops the clock from running. In the IRS revenue officer’s mind, your income may be going up while you wait for the offer to be rejected (the vast majority are) and he will be waiting at the end with the same amount of time to collect as when you filed the Offer. IF you don’t have much time left on the CSED think twice before filing an offer. You may be better off in an IRS payment plan that allows the clock to run while it is in place.

...

Collection Due Process Hearing Request The IRS has to issue a “final” notice of intent to levy before it can hit your bank account and paycheck. When it does an opportunity arises for you to appeal collection and propose alternatives like a payment plan or an OIC. The problem with a CDP hearing request is that the CSED is tolled after it is filed and it continues being tolled until the hearing is over – which may be a long time if you use the appeal right to go to tax court. If you file the hearing request late and it is treated as an equivalency hearing, the CSED isn’t tolled, but you still get to speak with appeals in most situations.

...

Installment Agreement Request This is a strange one and I don’t think most people are aware of this, but while the IRS is considering your Installment Agreement Request…the CSED is tolled.

...

Fraud You can’t defend a collection suit brought by the IRS by arguing that the CSED has run out if your own fraud prevented collection in the first place. Interesting scenario to imagine.

...

Your agreement to Extend

...

Someone Else has Your Stuff The CSED is tolled when you things are in the control or custody of a Court, arguably someone else, and even by the IRS in some circumstances.

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If this has helped, and you DON’T have other questions … I'd appreciate a positive rating, using the stars on your screen, and then clicking “submit"– That’s the only way I’ll be credited for the work.

I hope you’ll rate me based on my accuracy and thoroughness (as opposed to any good news/bad news content). Thank you!

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Customer reply replied 4 months ago
Does this mean that in my lien there are assessment dates of 2008 and 2009, the irs will not zero out my tax liability in 10 years?
Customer reply replied 4 months ago
would I have signed an agreement to extend the statute of limitations for collections?

The IRS WILL zero out the liability in 10 years (PLUS the amount of time that the statute was tolled - while they were CONSIDERING the payment plan for example - HAVING a plan does not toll the statute, only OIC or payment plans consideration time ... the time between the date you asked for it and the date that the payment plan started)

...

Yes, you would have to have agreed in writing to the extension .. these are rare these days in my experience.

Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 14,201
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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