What Happens to Liens in Bankruptcy?

Bankruptcy Procedure

A lien is a creditor’s legal right to a debtor’s specific property to satisfy a debt. The most common lien is a home mortgage. The homeowner borrows money from a bank to buy a house and signs a deed of trust which allows the bank to foreclose if the homeowner stops paying the mortgage. Read more »

Bankruptcy Basics: How Does Bankruptcy Work?

Bankruptcy Procedure

The word “bankruptcy” comes from the Italian words for broken bench — banca rotta. In the middle ages, a failing craftsman would bring his work bench to an authority in the town square, who would break it and in so doing, relieve the craftsman of his debts. Bankruptcy is more modern-looking today. Read more »

The IRS and its Notice of Federal Tax Lien

Tax Collection Issues

When a taxpayer doesn’t pay income taxes, the IRS automatically gets a lien against the taxpayer’s property. That means that legally, the taxpayer can’t sell anything without using the proceeds to pay the IRS. The IRS almost never enforces this “silent lien,” however. It’s silent because no one else knows about it. Read more »

Can You Negotiate Away An IRS Tax Lien? 

Tax Collection Issues, Taxes

A tax lien is a relatively passive way for the IRS or California’s Franchise Tax Board to get paid the back taxes you owe. Why passive?  Because it can take a long time for the IRS or FTB to get paid.  Suppose there’s a lot of equity in your house and owe you the IRS: when the IRS files a notice of tax lien against your house, nothing changes immediately.  Read more »