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Member
ericpcao01
Posts: 5
Registered: ‎02-06-2013
0

Need tax lien removed (both CA state and IRS)

Hi all,

 

First thank you for taking the time to view this post. I hope anyone that has similar situation can share your experience.

 

Back in 2007, I had some stock transactions. I ended up losing money so I didn't file a return that year (yeah, stupid me.)

IRS and CA state later came after me and said I own IRN 300k in tax and CA state 15k and each filed a lien against me. I later found out that they calculate my income solely based on my selling price and didn't take into account my buying price. I have my accountant submit a re-file around June 2012 and confirmed they have received it in early July 2012. In both filings, it shows I do not owe any taxes.

 

Here is the my situation now:

1. CA state: I was asked to pay a late filing fee of around $180, which I paid in December 2012. On my credit report, it shows now the lien was release but the record is still there. Is there any way I can get this deleted?

 

2. IRS: I called them in early January 2013 and was told all the systems are backing up and some of the data may not be available at the beginning of the year. They told me to call back in a month, which I did coiuple days ago. I was told that the re-file is still pending (yeah, what the heck? It has ben over 7 months.) As far as the lien, I was told by the lien department that they cannot do anything until the re-file is done and approved and an ok to release the lien would be forwarded to their apartment as well as a letter being sent to me. I am not sure about any late file penalty yet. In this case, will I be able to pay the penalty and get the lien deleted? I have found that IRS is easier to work with, in term of getting the lien deleted after paying off/ settled. Is it true?

 

 

Thanks again for viewing this post. Any suggestions/ recommendations are greatly appreciated.

 

 

Eric

Established Contributor
Crossdivided
Posts: 534
Registered: ‎01-23-2013
0

Re: Need tax lien removed (both CA state and IRS)

I don't know much about state taxes, sorry.

As far as federal,
1. Direct debit payment plan- they will remove lien after 3 consecutive payments drafted from your bank acct
2. When the debt is satisfied (either pif or offer-in-compromise) they will delete.
I'm still paying on mine so this is just what IRS is telling me, not direct experience. Be advised YOU must initiate the paperwork after you qualify, it's not automatic.
Established Contributor
electra
Posts: 573
Registered: ‎10-21-2012
0

Re: Need tax lien removed (both CA state and IRS)

I'm afraid the CA lien would take a miracle to remove.  I've got 3 really old ones and haven't been able to get rid of them yet.

 

The Federal you should be able to get removed with the Fresh Start program.    If your return has been 7 months being processed that doesn't sound right though. My suggestion is to contact the Taxpayer Advocate and see if they can help move things along.  



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Regular Contributor
Mondavi
Posts: 221
Registered: ‎06-12-2012
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Re: Need tax lien removed (both CA state and IRS)

Wow, when you saw the bill from the IRS you must have almost had a heart attack I would imagine. How long did it take for them to get around and send you what you owed after you did not file in 2007?

Getting the State lien off will not be an easy task. You could call and ask them if there is any steps you could take to get it removed. The CA franchise tax board is not a friendly group of people.

New Contributor
jmoney3457
Posts: 69
Registered: ‎10-08-2012
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Re: Need tax lien removed (both CA state and IRS)

[ Edited ]

Have a look here:https://www.ftb.ca.gov/individuals/liens/liens.shtml#remove It looks like you need to contact the CRAs directly to get it off.  Assuming you've paid the lien/been released from it.

Established Contributor
electra
Posts: 573
Registered: ‎10-21-2012
0

Re: Need tax lien removed (both CA state and IRS)

The CRAs will not remove a lien just because it was released.  They will simply update it to say "released".  Whether it's released or open, it still is the same hit to your credit score because it's on there. (Will look better on manual review though.)  Not saying don't try...just don't get your hopes up.   The CRA's will remove if it is withdrawn, but CA FTB doesn't do withdrawals for paid liens...only in the case of a lien they "filed in error" which I imagine, knowing the FTB is a pretty high bar to prove.



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Member
ericpcao01
Posts: 5
Registered: ‎02-06-2013
0

Re: Need tax lien removed (both CA state and IRS)

Thanks for all the inputs. I will keep my fingers crossed and see if CA will consider the lien withdrawn and remove it. I will post if there is any updates.

 

Mondavi, I forgot exactly when they start sending me letters but I think it's around 2011 or so.

 

 

Member
ericpcao01
Posts: 5
Registered: ‎02-06-2013
0

Re: Need tax lien removed (both CA state and IRS)

Hi all,

 

Here is my update on the latest tax lien on CA FTB and IRS:

 

CA FTB: I have tried writing them and calling them but got the same answer: they do not remove the released lien record from credit report. I am open for any suggestions on this one if anyone had any success with CA FTB

 

IRS: After waiting and calling them for 9 months, I finally received a letter from them. They sure know how to lag. Here is the billing summary:

 

Account balance before this change: $325,833.62

Decrease in tax:  - $206,423.00

Decrease in failure-to-file penalty: - $46,440.53

Decrease in failure-to-pay proper estimated tax penalty: - $9,395.15

Decrease in failure-to-pay penalty: - $31,994.99

Decrease in interest: - $31,531.34

-------

Amount due: $48.61

 

I am mailing the payment out today. According to the experience a lot of you had with IRS, hopefully the lien will be removed from my CR in about a month from now.

 

 

Thanks again for the help!

 

Established Contributor
TimeToRecover
Posts: 658
Registered: ‎03-21-2013
0

Re: Need tax lien removed (both CA state and IRS)

Well they won't just remove the lien they will just change it to satisfied and send you the form that it has been paid.  To get the federal removed you have to file a Form 12277 and that will file the withdrawl from the courts.  you then have to send this to the CRA's to have it actually removed.

 

I just started this process last week.  I sent off my F12277.  Waiting to get the form back verifying it has been vacated so I can get it off my CR.

 

I don't knwo anything about CA sorry.  Good luck with both.


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