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The IRS just hit me with a lien (not a levy) for some back taxes. They filed it with the county clerk. My bank accounts aren't frozen or anything but should I rush and empty all my credit card accounts of the points? I would hate for the banks to see the lien and shutdown my accounts before I had a chance to setup a payment plan for this tax issue.
That may be a good idea. Also get a payment plan going right away and make sure your payment is affordable. Check the lien to make sure it qualifies to be reported by the Credit Bureaus. It must have your full social, or date of birth and correct address. If not the CBs must remove it. Good luck my friend
@red259 wrote:The IRS just hit me with a lien (not a levy) for some back taxes. They filed it with the county clerk. My bank accounts aren't frozen or anything but should I rush and empty all my credit card accounts of the points? I would hate for the banks to see the lien and shutdown my accounts before I had a chance to setup a payment plan for this tax issue.
For maximum safety, I guess so, but IMO it would depends on which issuer and how bad emptying them now would be (e.g. transferring points to an airline when you don't know if that is going to be a great choice). Generally Chase gives you time after closure to redeem, at times Citi and Amex haven't.
I would think CL reduction more likely than outright closure, but certainly a risk.
I ended up transferring my amex and some chase URs to krisflyer. The rest of my chase URs I dumped into my hyatt account. I didn't want to take the risk and with the amex MRs at least this was where those points were going to go anyway (I already had like 10k with krisflyer) and I needed those URs to top off for a SQ redemption anyway. As to the rest I tend to use my chase URs with hyatt anyway, since I have the krisflyer miles stocked up and I have a bunch of AA miles. What I really would need is points for hotel stays so that seemed like it would be the best use for them.
I doubt any of them will blink; none of them did when I had a brand spanking new tax lien on my report several years back and things are more calm now than they were back then.
The thing about liens: you can't get them unless you have income... as a result it's less worrisome than many other public records is my theory on it.
As suggested, I would quickly get on a payment plan. I'm recovering from a lien that took place in 2015, I had a payment plan in place before the lien. It was also recorded in my county. My credit score took a 100 point hit. Since then the lien has been paid in full and removed from 2 credit bureaus but when my credit is pulled it still reports as derogatory. Keep in mind, that while you're on the payment plan and making payments the IRS will not update the amount owed. The full balance will remain until its paid in full for 30 days and then they will update your credit reports by request only.
@Anonymous wrote:As suggested, I would quickly get on a payment plan. I'm recovering from a lien that took place in 2015, I had a payment plan in place before the lien. It was also recorded in my county. My credit score took a 100 point hit. Since then the lien has been paid in full and removed from 2 credit bureaus but when my credit is pulled it still reports as derogatory. Keep in mind, that while you're on the payment plan and making payments the IRS will not update the amount owed. The full balance will remain until its paid in full for 30 days and then they will update your credit reports by request only.
If you setup a direct deposit agreement style payment plan with them, after six months, and assuming the balance was less than 25k to begin with you can proceed with Fresh Start even if it's not paid off.
Correct, pending approval of entering the fresh start program.
@Anonymous wrote:Correct, pending approval of entering the fresh start program.
Did you request for Withdrawal since you paid it all off.