A Closer Look at IRS Tax Liens with Guest Hubert Johnson
With me today on the show is an expert in a complex area of real estate — dealing with properties entangled by IRS tax liens. Introducing, Hubert Johnson, a seasoned tax attorney turned founder and president of The Guardian Law, who has published two books, lectured across the country, and hosts a daily podcast, “Taxes Made Easy”.
Ideal Process:
Johnson emphasizes that the IRS encourages buying, selling, and refinancing properties, even those with tax liens, to increase their chances of getting paid. But to navigate this process efficiently, a proper understanding of both sides of the coin — sellers and buyers — is essential. For those looking to purchase a property, IRS issues can limit mortgage company options. Where one finds restrictions, there are plenty of companies willing to work with them once a resolution is made. The key here is to start the process early, giving ample time to negotiate the reduction of tax lien as part of the purchasing process. This aids in saving a significant amount of funds.
Understanding the Tax Liens:
When a property under focus has a tax issue, it is crucial to understand the source of the tax lien. It is the responsibility of the buyer or seller to trace who owes the debt and assess its legitimacy. Sometimes, tax liens are erroneously linked to properties, through names of individuals or business partners without real interest in the property. Having this outlined clears the way forward, especially when dealing with IRS who can be stringent with information unless addressed by the debtor or taxpayer.
Considering the Kind of Property and Associated Liabilities:
Johnson also draws attention to the difference between residential and commercial properties. The distinction isn’t much when it comes to tax liens; the same regulations apply. However, different problems arise when the company owns the property and is dealing with other debt types, such as state sales taxes, SBA, or city property taxes. Each of these entities has different policies in place for the enforcement of tax liens, making working with these debts an intricate process. As such, an early start to understanding these nuances is advised.
Addressing Disputed Amounts:
While dealing with disputed amounts, options like contesting it through audit process, filing for tax abatements or an offer in compromise program or petition for abatement and removal of interest and penalties could be considered. However, these are subject to the specific situation and one’s eligibility.
Johnson underscores the importance of accurate and proactive action in dealing with IRS tax liens, in order to secure the best outcome for buyers, sellers and taxpayers alike. For a deeper dive, Johnson invites listeners to visit The Guardian Law website, call for a free consultation at 520-485-7371, and listen to his daily podcast, “Taxes Made Easy”.
