It attaches to what you own
Property such as your home and car, and rights to property such as wages and bank accounts. Publication 594.
Notice of Federal Tax Lien · Form 668(Y)
A lien is a claim, not a seizure. Here is what happens next.
In plain terms: the IRS has told the county recorder, and anyone who checks, that it is owed money. Nothing has been taken. There are four ways to deal with the notice, and each has a form.
01
What it means
What a Notice of Federal Tax Lien does
The lien itself arose when you did not pay the first bill. The notice is the IRS making that lien public.
Publication 594 puts it this way: a lien is a legal claim against all your current and future property. When you do not pay your first bill for taxes due, a lien is created by law and attaches to your property. That includes property such as your home and car, and rights to property such as wages and bank accounts.
The Notice of Federal Tax Lien is the public step. The IRS files it with local or state authorities, such as the county recorder, to establish the priority of its claim against other creditors. Within five business days of the first filing the IRS must send you Notice of Federal Tax Lien Filing and Your Right to a Collection Due Process Hearing.
The notice shows your assessed balance as of the date it was filed, not your payoff balance. The payoff figure comes from your account transcripts, which is why Phase 1 starts there.
It sets the IRS’s place in line
Filed with the county recorder so other creditors know the IRS’s claim comes first. It does not transfer anything.
It starts a 30-day clock
You have 30 days after the five-day notice period to request a Collection Due Process hearing on Form 12153. Publication 1660.
In plain termsA levy takes. A lien waits. The lien notice is the IRS reserving its place at your property, and the four tools below are how you move it, shrink it, or clear it.
02
Withdrawal · Form 12277
Withdrawal removes the notice from the public record
A withdrawal tells other creditors the IRS is abandoning its lien priority. It does not mean the debt is gone; it means the public filing is.
You are on a direct-debit payment plan
Publication 594: the IRS routinely grants withdrawal requests if you have entered a direct debit payment plan and meet certain other conditions. For most individual balances that means $25,000 or less, after three consecutive direct-debit payments.
The debt is paid and you ask
The IRS may withdraw when it is in your best interest and the government’s, for example when your debt has been satisfied and you request a withdrawal.
The IRS did not follow its procedures
Or the notice was filed during a bankruptcy automatic stay. A denied withdrawal can be appealed under the Collection Appeals Program on Form 9423.
In plain termsIf you can get on a direct-debit plan, the IRS will usually take the notice off the public record. We confirm from your transcripts that you qualify, then prepare Form 12277.
Withdrawal
Federal Tax Lien Withdrawal (Form 12277)
From $97
Get the Notice of Federal Tax Lien removed from public record. If you owe $25,000 or less and pay by direct debit, the IRS can withdraw the lien after 3 consecutive payments. We confirm eligibility from your transcripts and prepare Form 12277.
DIY guide $97, or we file it for a flat $497.
03
Release · Certificate of Release
Release is what the IRS owes you once the debt is paid
Internal Revenue Code section 6325(a) directs the IRS to release a federal tax lien within 30 days of the liability being fully paid, becoming legally unenforceable, or a bond being accepted. Publication 1450.
30 days after full payment
The Certificate of Release is filed in the same recording office as the notice, and a copy is mailed to your last known address.
Certified funds get it faster
Pay the balance with a cashier’s check, certified check or money order and the IRS can issue the release at once; other payment types take up to 30 days.
If it has not happened, you ask in writing
The request goes to the Collection Advisory Group for your area with a copy of each notice, the reason for release, and proof of payment.
In plain termsPaid in full but the lien is still on your record? The IRS has a deadline too. We write to Collection Advisory, follow up, and confirm the release was recorded at the county.
Release
Certificate of Release of Federal Tax Lien
From $97
Paid the IRS but the lien is still on your record? The IRS must release a lien within 30 days of full payment. We request the Certificate of Release from Collection Advisory and confirm it was recorded.
DIY letter kit $97, or we handle the request and follow-up for a flat $297.
04
Discharge · Form 14135
Discharge lets you sell one property out from under the lien
A Certificate of Discharge removes the IRS lien from the property named in the certificate, so a sale can close. The lien stays on everything else. Publication 783.
Apply at least 45 days before closing
Form 14135 goes to IRS Advisory Consolidated Receipts. The IRS asks for the application at least 45 days before the date the certificate is needed.
What goes in the package
A copy of the deed, an appraisal by a disinterested third party plus one more valuation, the sales contract, a title report of senior encumbrances, and the proposed closing statement.
The grounds, section 6325(b)
The remaining property is worth at least twice the liability; or the IRS is paid the value of its interest; or its interest has no value; or sale proceeds are held in escrow subject to its claim.
In plain termsThe IRS will let a sale close when it gets what the lien is worth out of the proceeds, or when it has enough left over to be covered. We assemble the package and coordinate payoff with escrow.
Discharge
IRS Tax Lien Discharge for a Property Sale (Form 14135) – Fresno & Clovis
$1,295–$1,995fixed fee
Selling a home or property with an IRS lien on title? We prepare Form 14135 with the appraisal, title report, and closing package, work with IRS Collection Advisory, and coordinate payoff with escrow so your sale closes.
Apply at least 45 days before closing. Appraisal fees are paid by the client.
05
Subordination · Form 14134
Subordination lets a new loan step ahead of the lien
A Certificate of Subordination allows a named creditor to move ahead of the IRS’s position for the property named in the certificate. It is how a refinance goes through. Publication 784.
Two grounds, section 6325(d)
Pay the IRS an amount equal to the interest it is subordinating; or show the IRS the certificate will increase what it collects and make collection easier, in a signed statement.
No appraisal required
Publication 784: a professional appraisal is not required for subordination, but a current title report is. One alternative valuation suffices.
Apply at least 45 days before closing
Form 14134 goes to the same IRS Advisory office as a discharge. A denial comes with Form 9423 and your appeal rights.
In plain termsYour lender will not take second place behind the IRS. Subordination is the IRS agreeing to take second place behind the lender, usually because the refinance puts money toward the tax.
Subordination
IRS Tax Lien Subordination for a Refinance (Form 14134)
$995–$1,795fixed fee
Refinance denied because of a federal tax lien? A certificate of subordination lets the new loan go ahead of the IRS lien. We prepare Form 14134 with the title report and loan package and present the case to the IRS.
Start at least 45 days before closing.
06
Your appeal rights
The hearing request is the deadline that matters
The lien notice gives you a right to a Collection Due Process hearing before IRS Appeals, which is separate from and independent of the Collection office. Publication 1660.
Form 12153 within 30 days
The IRS notifies you within five business days of filing; you then have 30 days to request the hearing. Calling the Collection office does not extend the period.
What the hearing can consider
Collection alternatives such as an installment agreement or Offer in Compromise; withdrawal, discharge or subordination of the lien; and economic hardship.
Missed the 30 days
You can request an equivalent hearing within one year plus five business days of the filing date. It is not reviewable in court and does not suspend collection.
In plain termsThe hearing is where a payment plan, a settlement or lien relief gets agreed with someone who does not work for Collection. Thirty days from the notice is the window to ask for it.
Appeal
Collection Due Process (CDP) Hearing Request & Appeal
From $497
Got a lien notice or Final Notice of Intent to Levy? You have 30 days to request a CDP hearing with IRS Appeals, which stops levy action and lets you propose a payment plan, settlement, or lien relief.
Form 12153 filed for a flat $497; representation at the hearing $1,495–$3,495.
Next step
Send us the notice. We tell you which of the four applies.
Free 20-minute review of your Form 668(Y) by an Enrolled Agent, by phone or in Fresno & Clovis.