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Do Tax Liens affect your credit?

Tax liens are outstanding debt you owe to the IRS, but since April 2018, they no longer appear on your credit reports and do not impact your credit scores.

The IRS does not report your tax debt directly to consumer credit bureaus now or in the past. As noted in the Taxpayer Bill of Rights, there are laws to protect your tax return information from disclosure by the IRS to third parties. However, once a Notice of Federal Tax Lien has been filed, your debt becomes public record. As a public record, tax liens may still be discovered by lenders and credit card companies. In addition to making it difficult to get new credit cards or loans, landlords or employers also may view the tax lien, which may have its own negative effects.

Until you have made payment arrangements or paid off your taxes, the IRS generally keeps the tax lien in place. Once it is paid, the lien comes off. So, as soon as you receive a tax bill, make a payment plan.

What should you do if you have a tax lien on your credit report? Tax liens on your credit report can drop your score and ruin your credit. The good news is that a credit repair agency can help you remove the tax lien from your file.  We’ll contact the credit bureaus and take the necessary steps to remove the liens from your credit report.


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