Tax Lien Q & A


I have a tax lien on my credit report from 1998. This tax lien was due to taxes on a 1099 job I had for 2 years. I did not pay the amount owed for the year of 1997. The IRS filed a tax lien for $12,000. My attorney said it should drop off after seven years. Well 7 years was a while back. What am I missing here? I have been told this tax lien will affect my credit score as well. I want to resolve this matter as quick as possible. I am getting ready to sell my home and purchase another home.


Determining when collections are going to come off your credit report might seem simple, but there are some types of credit report activity that does not apply to the 7 year rule. Tax liens are one of those debts owed that will not go away until you pay it. The Fair Credit Reporting ACT has different rules for this type of debt owed. Here are the facts.

• Unpaid Tax Liens- there is not a set expiration date for unpaid tax liens according to the FCRA. So tax liens will stay on your credit report until you pay it. Some credit bureaus cap how long they report records like tax liens for up to 15 years. So if a tax lien has been reporting for over 15 years, you might consider disputing to see if the bureaus will remove.

• Paid Tax Liens – Once a tax lien is paid off, the tax lien will report on your credit report for 7 years from paid date. Tax liens are the only record where the expiration date is tied to repayment.

Jim you do have a chance of getting this record off by disputing it. There is no guarantee it will com off though. You will more than likely have to pay the debt off. You can use our how to dispute process here.

Mike Clover

19 Responses to “Tax Lien Q & A”

  1. NetDebt says:

    Taxes Suck

  2. Morgan King says:

    Wrong. An IRS tax lien has a life-span of 10 years from the date the underlying tax was assessed. The 10-year period can be extended by certain things the taxpayer may do, such as file a bankruptcy or submit an offer-in-compromise. And, the IRS can sue to reduce the lien to a judgment in federal district court, which will extend the period, but the IRS rarely goes to that trouble.

  3. my720fico says:

    Actually I am correct, tax liens once paid are on your credit report for 7 years. Not sure if that is what you are talking about.If it is not paid, some bureaus will remove after 15 years, no guarantee. That does not mean you dont owe the debt.

  4. Susan says:

    I've just paid in full both a federal tax lien & a civil judgment, and my credit score dropped 40 points. I haven't done anything else that would impact my credit score. Why would my score drop so much? If this is not the appropriate forum to be asking this question, I apologize.

  5. my720fico says:

    Not sure why your credit score would have dropped other than it being a recent update from balance being owed to paid. I would not sweat it, because you have to pay those types of debts anyways, because you cannot get most loans with liens on your credit report.Give it a couple of months and your credit score will go back up. You might check your credit report to make sure another collection was not re-sold, this typically drop’s your credit scores like that, not paying off a collectin or tax lien.
    Mike Clover

  6. nancy says:

    I received a tax lein for a very small amount of money and paid it immediatley. My credit score has been lowered because of it. Do I need to send the lein release to the credit report? Will it help my credit score?

  7. my720fico says:

    Yes, you will need to send the release of lien to the credit bureaus to make sure the lien holder sent the release of lien to the credit bureaus. Once updated you might see a increase in your credit scores, no gurantees though with public records. But if you want to buy a home you typically cannot have a public record like that showing a balance still owed.

  8. Anonymous says:

    Once the tax lien is paid, it will still report on your credit report for 7 years paid.

  9. Anonymous says:

    Yes, you will need to fax the the release of lien to the credit bureaus (trans union , eqifax, and mail a copy ot experian to expedite. the state tax lien at that point is going to show as paid , or satisfied , it will stay on there 7yrs from paid date, howver in order to get approved thru FHA you must have all liens and old banks acct paid off, the courts or IRS wil not!! I repeat… WILL NOT!!! send anything to the bureaus for you ,, YOU have to do your own leg work. release of lien to the credit bureaus. you can get a release of lien from the IRS state tax office in your city, they will sign & date stamp. the form, they will give you a copy and send the original to the court where the original to the state court office and they will sign and dated and mail it back to the IRS , then the IRS will then mail the original to with both the date and stamp with IRS seal & state court date & stamp & seal.If you don't want to wait for them to send you back the doc. Go ahead a fax the copy thatthe IRS will give to the bureaus to see if that will work. It worked for me and the CRA updated my report in less than a week,!! Godd Luck I hope this was not too confusing.

  10. Anonymous says:

    I have two state tax liens on my credit report. I went to my local court house and received copies of everything. Louisiana Department of Revenue sent the letter to the court house stating that these liens are to be erased and I still can’t get them off of my credit report. Any help??????

  11. Credit Guru says:

    What have you done to try to get them off your credit report ? I would also recommend reading this article.

  12. Anonymous says:

    I have a Federal Tax lien of 20,000 dollars and on my credit report it says July 17 it will be removed its a combination of 2000-2002-2004. The 100.00 payments and negotiations never worked I even tried to file Chap 11 back in 2002 and that did not work lost my job so i am living in a foreign country and am not paying anything and I dont have no kids, no property nothing Single. middle aged and never plan to buy anything. WILL this come off as they say July 15 and does the Statute of Limitations apply where the IRS has only 10 years to collect.

  13. Credit Guru says:

    Hello in some cases the Statute of Limitations do not apply. It sound like since you filed bankruptcy and did not allow it to discharge, your 10 year Statute of Limitations can be extended. This by no means is legal advice, I would consult with a Tax Attorney. I would not assume that since the 10 year is up, that the IRS will not pursue this debt. From our understanding it will not be removed from your credit report until you pay it.

  14. maribel says:

    maribel said…I have a state tax lien for Maryland for money I never owed. They owed my husband money instead yet they still put a tax lien with the amount that they stated we owed, even after they cut us a check for twice that same amount… Is this even legal and can the lien be completely removed off of our credit reports since they should have never been there? Oh they also submitted Lien Releases after they paid us!!! I don't want any of that on my credit report or my husbands… help?

  15. Credt Guru says:

    If it was a mistake on the state, then yes you should dispute on line that they need to remove from the credit bureaus completely. Use this to dispute on-line.

  16. David says:

    Does anyone here have any suggestions on how to find a job or do a good interview? I am set to graduate this spring and want to get a head start on trying to find a job.

  17. Catherine says:

    I just paid my Federal Tax lien and I’m trying to buy a house. I am 3 credit points away from qualifying for a loan. Will paying the lien bring my score up at all? Or is as lien, is a lien, is a lien regardless as to weather it is paid or not?

  18. CreditGuru says:

    HI Catherine, you will have to pay that federal tax lien to buy a house anyways. Whether it will increase your credit score is a crap shoot. In most cases it will increase your score, but sometimes it can lower it.

  19. Praying says:

    I have a federal tax lien from the tax year 2000. It is now almost October 2010 and it is still on my house. How can I check to see when the lien will reach the statute of limitations without raising a flag to the IRS?

Disclaimer: This information has been compiled and provided by as an informational service to the public. While our goal is to provide information that will help consumers to manage their credit and debt, this information should not be considered legal advice. Such advice must be specific to the various circumstances of each person's situation, and the general information provided on these pages should not be used as a substitute for the advice of competent legal counsel.