What Is a Tax Lien?

What Is a Tax Lien? A Tax lien is a security interest that the government has in any real or personal property that the taxpayer almonds so what does that mean so in reality if you owe an obligation to the IRS or to the state then a lien is the government's way of protecting its interest in case you were to liquidate any property so let's take a house because that is the example that we run into most commonly for taxes if you own a house and if the house has equity and the government puts a lien against it then when you go to sell that house the government it's gonna take its share of what you owe before you get any proceeds so a lien is just simply protecting the government's interest saying hey we're the IRS we're the state of California we have a right to the equity in this property prior to it being sold so what a lien does is lien those two things number one it protects the government's interest and number two leaves are a matter of public record so when a lien shows up it has the tendency to either damage the taxpayers credit it could be discoverable.

So anybody who's applying for a government job or anything with the security clearance or anything like that will have an issue with the lien a lien can impact banking relationships it can impact loans if your lenders find out about a lien and particularly if you have a tax liability that you're not in compliance for then a lien can be very very damaging and then where we run in this a lot is with people who professional licenses if you have a place it through FINRA or you have at FCC license alena caused a lot of problems if you're a fiduciary and you get a tax lien filed against you the act of the lien getting filed against you means that or suggests that you may not be up to the task of being a fiduciary so liens can be very damaging but let's call them what they are it's just the government protecting its own interest by filing a piece of paper with the County Recorder in order to preserve their rights they're not gonna suck any assets out of you they're not gonna levy your bank statements that levies are levies liens or liens so that's what a lien is the lien is protecting the government's interest in any property and staking a claim to that.


Sam Brotman, JD, LLM, MBA

Owner and Director of Legal
Brotman Law