topic Re: Don't EVER get a tax lien!!!! in Understanding FICO® Scoring

Don't EVER get a tax lien!!!!

jamie123 — Sat, 10 Oct 2015 00:31:10 GMT

I've been actively trying to remove a tax lien from by EQ and TU reports and it is taking forever.

My EX report is about the same as my EQ and TU reports except it is clean and has 1 old closed CC reporting that EQ and TU don't have.

The tax lien on EQ and TU is holding my scores down like an anchor! My EQ and TU scores are similiar so I am only posting my TU score.

Look here:

Seven months straight at the same 707 score!!!!

This is what my EX score looks like with a clean report and the addition of one really old CC:

Do whatever it takes to NOT get a tax lien!!!

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 00:39:57 GMT

I see your Albatross is named Tax Lein.

Mine is a saucy wench named Charged Off.

Continue to stare into the horizon...

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 01:30:32 GMT

I have a similar situation with a variance in the reports.

TU - 819

EQ - 746

EX - 742

Guess which two have the tax lien.

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 01:34:49 GMT

Just curious, how old is your tax lien?

Re: Don't EVER get a tax lien!!!!

elim — Sat, 10 Oct 2015 01:50:40 GMT

Tax Liens are lovely arent they?

2010 - 13k Fed that won't be satisfied until next Jan (then I'll have it for 7 more years).

The highest my scores have been is 730 with the lien reporting... 675 to 725 now.

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 01:53:41 GMT

@elim wrote:
Tax Liens are lovely arent they?

2010 - 13k Fed that won't be satisfied until next Jan (then I'll have it for 7 more years).

The highest my scores have been is 730 with the lien reporting... 675 to 725 now.

Mine is a nearly $39,000 state tax lien which I finally got paid off in March of this year, so I'm stuck with it until March of 2022. The original tax amount was less than $19K, and in total I paid over $45K.

Re: Don't EVER get a tax lien!!!!

jamie123 — Sat, 10 Oct 2015 01:55:06 GMT

@Anonymous wrote:
Just curious, how old is your tax lien?

It is a State tax lien from 2007. And yes, the statute of limitations on this State tax lien is 40 years. Yes, you heard that right, 40 years!!!!

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 16:54:17 GMT

Agree, don't ever get a tax lien, but if you do...

I was able to obtain EQ 740/TU 752/EX 753 with 3 federal liens 3-4 years old

AAoA 8+, Oldest 18, 3 bank cards, 1 open car loan (2 closed), 2 mortgages on 2 properties (7 & 8 years respectively), low utilization and no other baddies

There isn't a lot of help out on there/here on what to do when you do have a tax lien.

If you have released federal liens, you need to file a Form 12277 and this information is readily available on the net.

If you owe less that $25K federal, you have to jump through a few hoops, but you can get the liens withdrawn.

I have done lots of research and even with my saga coming to conclusion, I continue to research in hopes of helping others.

While I am not sure of the exact point hit being handed down, I will say that it is far more substantial than I had suspected, even after 4 years.

EQ (in particular EQ 04) seems to really be hampered by these liens even after they have been paid.

There are some reporting idiosynchrasies that may contribute to the EQ score.

I am almost clean and will post details when it happens on all three bureaus.

There are some methods for removal that are not encouraged or allowed to be discussed on this forum.

I have recently stumbled on something that may help those of you with satisfied/released state liens reporting.

@elim - There is help for you. I will help you on the open forum or via PM if you prefer.

Re: Don't EVER get a tax lien!!!!

kwinks — Sat, 10 Oct 2015 17:10:54 GMT

Forgive my really stupid question but...

what is a tax lien and how do you get it or better said, how do you stop from getting one.

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 17:14:35 GMT

@Anonymous wrote:
Agree, don't ever get a tax lien, but if you do...

I was able to obtain EQ 740/TU 752/EX 753 with 3 federal liens 3-4 years old
AAoA 8+, Oldest 18, 3 bank cards, 1 open car loan (2 closed), 2 mortgages on 2 properties (7 & 8 years respectively), low utilization and no other baddies

There isn't a lot of help out on there/here on what to do when you do have a tax lien.
If you have released federal liens, you need to file a Form 12277 and this information is readily available on the net.
If you owe less that $25K federal, you have to jump through a few hoops, but you can get the liens withdrawn.

I have done lots of research and even with my saga coming to conclusion, I continue to research in hopes of helping others.

While I am not sure of the exact point hit being handed down, I will say that it is far more substantial than I had suspected, even after 4 years.
EQ (in particular EQ 04) seems to really be hampered by these liens even after they have been paid.
There are some reporting idiosynchrasies that may contribute to the EQ score.
I am almost clean and will post details when it happens on all three bureaus.

There are some methods for removal that are not encouraged or allowed to be discussed on this forum.
I have recently stumbled on something that may help those of you with satisfied/released state liens reporting.

@elim - There is help for you. I will help you on the open forum or via PM if you prefer.

When my tax lien mysteriously vanished from TU my score immediately jumped from 719 to 795.

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 17:16:45 GMT

@kwinks wrote:
Forgive my really stupid question but...

what is a tax lien and how do you get it or better said, how do you stop from getting one.

When a governmental entity determines through audit that taxes have been underpaid and one does not have the money to pay immediately, they file a lien so they can snatch away any available assets in an attempt to satisfy the amount they say you owe.

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 17:21:21 GMT

@kwinks wrote:
Forgive my really stupid question but...

what is a tax lien and how do you get it or better said, how do you stop from getting one.

Failure to pay taxes, in a simplified way to say. There are multiple forms and loops you have to jump through to avoid this and/or rectify. There's Federal and State if your state has a personal tax.

edit: I got audited recently on 2013 Fed and blew my savings to avoid a Lein.

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 17:21:15 GMT

Where does a tax lien fall in relation to a CO still showing or a judgement still posting in terms of impact to scores? About the same?

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 17:23:02 GMT

It's a public record.

Here's a of state http://www.taxationlawfirms.com/resources/tax/tax-statute-limitations/tax-lien-statutes.htm

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 17:41:52 GMT

@Anonymous wrote:
@Anonymous wrote:
While I am not sure of the exact point hit being handed down, I will say that it is far more substantial than I had suspected, even after 4 years.

When my tax lien mysteriously vanished from TU my score immediately jumped from 719 to 795.

How old was your tax lien? Was it paid/satisfied/released? Was the rest of your file optimized?

I'll post more when I get full results and assurance that this is not a fluke, but I am relatively confident in saying EX hit me for almost 100 points on FICO 8 and almost 90 on EX98.

Re: Don't EVER get a tax lien!!!!

jamie123 — Sat, 10 Oct 2015 17:48:53 GMT

@Anonymous wrote:
Where does a tax lien fall in relation to a CO still showing or a judgement still posting in terms of impact to scores? About the same?

I think that a tax lien is the worst baddie that you can have on your reports. In my opinion it can hold your scores down by 100 points or better for as long as it appears on your reports. My tax liens are from 2007 and I've never been able to get my EQ and TU scores above 707. My clean EX report used to be around 707 until the tax lien fell off last May for some unknown reason and is now at 813 for a difference of 106 points.

Charge offs and judgements seem to affect your scores a little less as they age. Don't get me wrong, they are still MAJOR baddies as long as they are on your reports but from what I see around here the COs and judgements seem to be worth around 50 to 75 points when they fall off.

A tax lien is really hard to get removed because you have to deal with the State or Federal bureaucracy and it is slow and almost impossible to get anything moving.

Re: Don't EVER get a tax lien!!!!

Tishomingo — Sat, 10 Oct 2015 17:59:38 GMT

What state? Research how to have a tax lien withdrawn....not sure if works the same for State as it does Federal. I had 2 Federal Tax Liens and my tax people offered to get them removed for $1500...I did my own research and found out how to do it. It was kind of mentioned earlier; but on the Federal level, they only put liens if you owe more than $25,000. The trick is to set up a payment plan with auto withdrawls and make at least 2 payments. Once your total is under $25k, you file to have the liens withdrawn. One of my liens had actually been paid off by the time everything was submitted, but both the paid and unpaid liens were withdrawn and I submitted forms to each of the CRA's and they were REMOVED from my report completely. Took 6 months or so, but was well worth it.

Re: Don't EVER get a tax lien!!!!

jamie123 — Sat, 10 Oct 2015 18:08:36 GMT

@Tishomingo wrote:
What state? Research how to have a tax lien withdrawn....not sure if works the same for State as it does Federal. I had 2 Federal Tax Liens and my tax people offered to get them removed for $1500...I did my own research and found out how to do it. It was kind of mentioned earlier; but on the Federal level, they only put liens if you owe more than $25,000. The trick is to set up a payment plan with auto withdrawls and make at least 2 payments. Once your total is under $25k, you file to have the liens withdrawn. One of my liens had actually been paid off by the time everything was submitted, but both the paid and unpaid liens were withdrawn and I submitted forms to each of the CRA's and they were REMOVED from my report completely. Took 6 months or so, but was well worth it.

Ahhh that's the difference between State and Federal tax liens....

The IRS has guidelines set up to have your liens satisfied and removed. Follow the guidelines, pay the liens and they will be removed.

Most states don't have guidelines or payment methods set up. You are basically on your own. Sure, they will take your money but having them removed is a whole different animal. AND. THEY. DON'T. CARE.

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 18:11:38 GMT

@Anonymous wrote:
@Anonymous wrote:
@Anonymous wrote:
While I am not sure of the exact point hit being handed down, I will say that it is far more substantial than I had suspected, even after 4 years.

When my tax lien mysteriously vanished from TU my score immediately jumped from 719 to 795.
How old was your tax lien? Was it paid/satisfied/released? Was the rest of your file optimized?
I'll post more when I get full results and assurance that this is not a fluke, but I am relatively confident in saying EX hit me for almost 100 points on FICO 8 and almost 90 on EX98.

March 2008, and it vanished the end of February 2015. At the time it disappeared, it was not yet paid off. I finally got it paid off the following month, March 2015. I think, but I'm not sure, that TU used the 7 years that would normally be applied after a lien was paid. Yes, the rest of my file was/is optimized.

Re: Don't EVER get a tax lien!!!!

Anonymous — Sat, 10 Oct 2015 18:15:23 GMT

@jamie123 wrote:
@Tishomingo wrote:
What state? Research how to have a tax lien withdrawn....not sure if works the same for State as it does Federal. I had 2 Federal Tax Liens and my tax people offered to get them removed for $1500...I did my own research and found out how to do it. It was kind of mentioned earlier; but on the Federal level, they only put liens if you owe more than $25,000. The trick is to set up a payment plan with auto withdrawls and make at least 2 payments. Once your total is under $25k, you file to have the liens withdrawn. One of my liens had actually been paid off by the time everything was submitted, but both the paid and unpaid liens were withdrawn and I submitted forms to each of the CRA's and they were REMOVED from my report completely. Took 6 months or so, but was well worth it.
Ahhh that's the difference between State and Federal tax liens....

The IRS has guidelines set up to have your liens satisfied and removed. Follow the guidelines, pay the liens and they will be removed.

Most states don't have guidelines or payment methods set up. You are basically on your own. Sure, they will take your money but having them removed is a whole different animal. AND. THEY. DON'T. CARE.

Yep. I'm still going to try with my state tax lien, but I'm not holding my breath.