Tax Lien on credit report

[Anonymous]

I am currently trying to rebuild my credit.  Everything negative is off my credit report, except for this tax lien.  I'm not really sure what it is even for.  This is on my Equifax report.  It shows as filed on 9/2000 by Financial Credit Corp, in the amount of $0.  Then says Class:  County/City.  I searched public records for my county, and I see a judgement I had in that year, but has since been paid.  There is no other information.  If the amount shows $0, wouldn't that mean that I owe nothing?  Also, i'm a little confused what a tax lien even is.  I have never owed a house (am in the process of trying to now), everything I have searched on with tax liens, shows it is attached to a property, but I had no property for it to attach to.  Does anybody have any info that I could go on, to try and clear this up?  Any ideas on who I would even call?  Thanks! 

Amy

[WannaHouse]

If it is listed as a tax lien, it may be taxes you owed and did not pay? I had one for 309, and it was because we made a mistake on our return and the IRS caught it. (we did not do it on purpose...it was a math error)

I would call the IRS and check with them for any tax lien. If there are none, I would have the CRA verify what it is.

Judgements and tax liens will stop you from getting a mortgage, so if you have either one, you need to fix it.

[Anonymous]

Just to add to Kathy's awesome post:

1) The reason you have a tax lien on your CRs is to ... well, reserve their right to attach a lien to any property you *might* own in the future. This could include vehicles, boats, or real property (AKA a house). Just because you don't own one now, doesn't mean anything.

It's for that express reason that, as Kathy mentioned, you WILL have to pay this lien off before you can be approved for a mortgage. Lenders don't like that kind of competition for their collateral.

In that sense, well, they're pretty much blackmailing you into paying it. Until it's paid, chances are, no lender or creditor will extend you credit. Again, it's competition for collateral or assets that *they* might want to leverage. So PLEASE make sure it's paid!

2) It *might* be paid via offset tax returns. Did you ever get less refund than you thought you were going to get? If so, there's the reason why -- why you got less than you believed you were entitled to, and why it's paid off.

3) The BIGGIE is to see WHEN it was paid off. Count 7 years from that date, and that's when it should fall off your CRs.

4) You would want to call either your state taxing authority or the IRS. Both can attach a lien for unpaid taxes. If you owned your own business, they can even attach a lien due to unpaid state sales taxes (or county, city ,etc -- whoever levies sales tax in your area).

They would know. If they don't, and you don't mind risking them updating/verifying with the CRAs, you can dispute as "not mine." If they don't have the records on your lien, they can't report you for it.

[Anonymous]

Thanks for the info.  I will check with the IRS on that.  The part that mostly confuses me is that the amount shows as $0, and I don't remember any of my tax returns being short, so i'm not really sure what it is.  This is the only thing holding me back.  My fico is at 612, and I know this is the big reason why it is so low. 

Amy

[Anonymous]

I have one more question.  I did find a case number on this tax lien, and I entered it on my county clerk of courts record search, and it brings up my judgement.  Can a judgement put a tax lien on me?  Or could this just be incorrect, and actually should have been reported on my report as a judgement, not a tax lien?  The judgement was on my reports for the longest time, but those fell off on my other 2 reports, due to age.  Thanks!

Amy

[Anonymous]

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@Anonymous wrote:

I have one more question.  I did find a case number on this tax lien, and I entered it on my county clerk of courts record search, and it brings up my judgement.  Can a judgement put a tax lien on me?  Or could this just be incorrect, and actually should have been reported on my report as a judgement, not a tax lien?  The judgement was on my reports for the longest time, but those fell off on my other 2 reports, due to age.  Thanks!

Amy

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TAX liens can't be attached for judgments, per se. But since the CRAs DO make the odd mistake occasionally, I think it's worth looking into. It sounds as though you have a judgment (which can be "good news" depending on when it was filed: see below) and not a tax lien (they are NOT the same thing).

I say that because IF it's a judgment, it's subject to the 7 year reporting rule from the date FILED while a tax lien is 7 years reporting from the date PAID. Big difference, you see?

What you need to do is find out WHEN it was filed and who's it for. From there, you should be able to figure out WHEN it should have fallen off, if need be. And then you can decide whether or not it's time to dispute as "obsolete" or wait 'til it falls off.

When you plug that info into your CCoC records search, what date FILED did it give????

[Anonymous]

Date filed is 9/2000.  How would I dispute this with Experian?  Tell them this is actually a judgement, not a tax lien, and the 7 years has passed?   I am so excited, that this is beginning to look like it was misreported by Experian.  Do you think my score will jump quite a bit, once removed?  

Amy

[Anonymous]

I would be prepared with as many court docs as possible (to back up your assertion that this is NOT a tax lien and is, in fact, a misreported judgment) and dispute as "obsolete."

However, bear in mind that if EX decides that it is, in fact, a TAX lien, when they update it as such, it WILL drop your score, as FICO will see it as "new."

But yes, if it's a judgment, it should have aged off nearly two years ago.

[Anonymous]

I would call your courts and give them the case number and ask what it is and explain what is showing on your report. Ask them if there is a way to check for tax liens, just to be safe.

After that, I would dispute with Experian as "misreported as a tax lien, is actually a judgment and is beyond 7 year reporting time, date filed 9/2000".

And hope they do the right thing and remove.

IMO, gather your evidence, but don't provide anything to EX yet, as they rarely look at it anyhow. Go ahead and dispute and if not removed, then I would pounce them with your evidence and require them to investigate and report accurately.