A Withdrawal only removes the effect of the NFTL whereas the Certificate of Release both releases the NFTL (paper document) and extinguishes the statutory tax lien. Once the tax debt is paid in full, the tax lien will be released within 30 days. The IRS files a “Certificate of Release of Federal Tax Lien with the same local or state authorities that received the NFTL when you obtain a “release. This removes the lien from your property.
If you pay the IRS all of your taxes owed plus any interest and penalties, the agency will release the tax lien. You can request the release using the IRS form 1450.
Can you negotiate a tax lien with the IRS?
If the home is being sold for less than the lien amount, the taxpayer can request the IRS discharge the lien to allow for the completion of the sale. You negotiate that the IRS withdraw the tax lien by entering into an installment agreement for you to pay the tax in full. The IRS currently is working to speed requests for discharge or mortgage restricting to assist taxpayers during this economic downturn. It may be a legitimate option if you can't pay your full tax liability or doing so creates a financial hardship.
When the IRS agrees to withdraw the lien due to its own error, this should be accomplished with as much fanfare as the lien was filed.
Does an IRS lien ever go away?
At that time California law comes into play and the IRS can record the judgment effectively as a new tax lien for successive 10-year periods. Secondary to getting the IRS to withdraw the lien entirely, you want to make sure that you get a tax lien release from the IRS. There is a lot of advertising on television these days from companies offering to solve all your tax problems with an IRS OIC. The tax lien will still expire at the end of 10 years – even if the IRS has more than 10 years to collect – unless the IRS timely refiles the lien.
