Depending on the situation you’re in, a tax lien will affect you differently. Tax liens show up as public records on your tax report, and that could harm your credit score. This is mainly because the reason for the lien is the problem, not the balance. Once the lien is filed you won’t be able to get a new credit card, a loan for a vehicle or car, or even sign a lease.
How Can I Remove a Tax Lien?
Tax Liens are also difficult to remove and have the potential to stay on your credit history indefinitely as the “seven year rule” does not apply to them as they do most negative credit items. There are many ways to remove a tax lien such as:
- Reaching a settlement with the IRS
- Paying off the lien in full
- Requesting a withdrawal where you pay your lien in full or enter a payment program that will pay it off in full.