State and it is Ohio
Ohio tax liens are judgment liens and are filed with the clerk of courts. While the procedure you have mentioned will have the lien recorded as released, it won't necessarily remove it from your credit file. A released tax lien can stay on your credit file for seven years from the date it is recorded as released.
The IRS's new procedure is to have the lien withdrawn. This is separate from having it released. By having it withdrawn it is treated as if it never happened in the first place and should be removed from your credit file.
I am not aware of any states that withdraw liens.
I have an Ohio tax lien that I've been banging my head against for nearly a year now. Paid it in Mar 2007, but did not realize it had to be recorded at the courthouse until Nov 2007. Despite it being "cancelled" (according to the release) in March, it still shows as November on the CRAs. VERY frustrating, adding a random 8 months reporting. I've written a boatload of letter to various agencies, representatives, etc not understanding why I'm "sentenced to a 7 year debtor's prison term" for something I paid in full as soon as I found out about it (it was estranged husband's filing, I thought he paid it). I don't understand why the IRS can withdraw, but the states can't. Seems like it would be in their best interest to not have that anchor dragging down credit scores when the citizen paid the debt. The goal is to collect the taxes, not inflict punitive damages, right?
Well then my friend I just wasted money for something I should have left alone. lol
Thanks for the detailed instructions. I will be using it tomorrow. Wish me luck.
I did get a letter from the tax agency after they reviewed my return and discovered I owed no tax at all. The courthouse refused to acknowledge the letter. Disputing it at the CRB's did no good at all. I have sent the state letters to the CRB and the courthouse and nearly 8 months later they will not remove it. Nor will they show it as paid.
you need to ask the Tax agency to give you "withdrawl lien' papers. If its their mistake they will do this. Hope this helps.
1. Send it certified witha copy to their legal department. File a small claims lawsuit if they refuse.
2. Go to your county clerks's office and give them a copy, they are also obligated to remove it.
I just dropped in here on a google search and noticed on the IRS website it has slightly different instructions for form 12277. Specifically, it says to check box 11, not box 12. Here is a link to the instructions: