If you have a tax lien being reported on your report you score is in serious trouble. You should remove this item as soon as possible.

The first step is to request validation from the bureaus. This is done through sending a dispute letter directly to each.

Unfortunately mistakes do happen on your report; there are estimates that 1 in 4 people have an error on their report.

When your letter is received then the bureau will contact the state or federal government and ask them to verify the debt. If it is verified then you will have to negotiate payment to remove it.

If you have a large debt you should speak with a tax attorney or negotiator to help work out some form of repayment. Frequently you can pay a reduced amount, and when paid you can remove it from your report.

These debts are collectible for 10 years. The negative mark will stay on your credit for 7 years once it is paid. If it goes unpaid you could have a lien on your report for a long time.

Upon payment you should wait around 3 months and then send another dispute letter to the bureaus asking for validation. We have learned that once the government has received payment they often will ignore a bureaus request for validation.

Thus your lien will not be verified and the bureaus will remove it from your report. Additionally if this mark was make in error then send any documentation along with your dispute letter to prove that.

Repayment

The IRS and state governments are willing to accept partial payment. It is called OIC (offer in compromise), this means you are settling your tax debt for less than the balance.

The government will look at; your ability to repay, your income, your assets, and what they expect to recover. Additionally it will help your chances of acceptance, if you attach a letter showing financial hardship.

It may be in your interest to hire a tax attorney or negotiator to help negotiate a repayment amount. It is not absolutely necessary but nonetheless a good idea.

In sum, take action today and get this lien off your report. It will be hard to be approved for credit with decent terms as long as this mark is on your credit. Don’t just wait seven years.

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