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Friday, January 2, 2009
With a tax lien on your credit report your score will be dramatically affected. You should take action to erase this mark from your report.
The first step is to have the bureaus validate the lien. You need to send each bureau a dispute letter.
Unfortunately mistakes do happen on your report; there are estimates that 1 in 4 people have an error on their report.
Upon receipt of your letter the bureau will investigate the mark. They will contact the state or federal government and ask for verification that the debt does exist. If it is verified then you will have to make some form of payment.
If you have a large debt you should speak with a tax attorney or negotiator to help work out some form of repayment. Frequently you can pay a reduced amount, and when paid you can remove it from your report.
A tax lien can be collected upon for 10 years, and will stay on your report for 7 years once it is paid. If not paid then you can be reporting a tax lien on your report for a considerable amount of time.
However once you pay in full, wait three months and dispute the mark again. It has been learned that frequently the government will ignore future validation requests from the bureaus once a lien is paid.
Thus your lien will not be verified and the bureaus will remove it from your report. Additionally if this mark was make in error then send any documentation along with your dispute letter to prove that.
Repayment
The IRS and state government often accept partial payment. To propose this to them you will make an offer in compromise, often called an OIC.
The government will decide to accept based on; your income, assets, ability to repay, expected amount they will recover. It can help if you send in a letter explaining your financial hardship that led up to this.
It may be in your interest to hire a tax negotiator to help with this. However you do not have to just live with this mark on your report.
In sum, take action today and get this lien off your report. It will be hard to be approved for credit with decent terms as long as this mark is on your credit. Don't just wait seven years.
The first step is to have the bureaus validate the lien. You need to send each bureau a dispute letter.
Unfortunately mistakes do happen on your report; there are estimates that 1 in 4 people have an error on their report.
Upon receipt of your letter the bureau will investigate the mark. They will contact the state or federal government and ask for verification that the debt does exist. If it is verified then you will have to make some form of payment.
If you have a large debt you should speak with a tax attorney or negotiator to help work out some form of repayment. Frequently you can pay a reduced amount, and when paid you can remove it from your report.
A tax lien can be collected upon for 10 years, and will stay on your report for 7 years once it is paid. If not paid then you can be reporting a tax lien on your report for a considerable amount of time.
However once you pay in full, wait three months and dispute the mark again. It has been learned that frequently the government will ignore future validation requests from the bureaus once a lien is paid.
Thus your lien will not be verified and the bureaus will remove it from your report. Additionally if this mark was make in error then send any documentation along with your dispute letter to prove that.
Repayment
The IRS and state government often accept partial payment. To propose this to them you will make an offer in compromise, often called an OIC.
The government will decide to accept based on; your income, assets, ability to repay, expected amount they will recover. It can help if you send in a letter explaining your financial hardship that led up to this.
It may be in your interest to hire a tax negotiator to help with this. However you do not have to just live with this mark on your report.
In sum, take action today and get this lien off your report. It will be hard to be approved for credit with decent terms as long as this mark is on your credit. Don't just wait seven years.
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posted by Credit Counseling at
5:26 AM
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