New IRS Policy on Tax Liens

Exciting new policies for taxpayers who are about to get hit with tax liens or have already been hit with one.

  • The tax owed the IRS is now $10,000 instead of $5,000.
  • It will be a lot easier to get a lien removed. In fact, one may get it removed by getting a direct withdrawel agreement with the IRS, after a probationary period. (This makes so much sense one wonders why the IRS have not been doing this all along!)
  • Small businesses with $25,000 in unpaid taxes can now get an installment agreement over 24 months. Earlier threshold was $10,000. At least this is a step in the right direction. One still wonders why businesses cannot get agreements based on projected ability to pay.
  • On the Offers in Compromise front, taxpayers with incomes < $100,000 are eligible (versus < $50,000 earlier). Tax liability must be < $50,000 (versus < $25,000 before).

Many people may have just given up. They now have some hope of getting out of their tax debt.

More info from the IRS.

Masters of Finance Blog