Hopping out of tax lien trouble

Written by on behalf of Robert J. Fedor, Esq., L.L.C. | May 29, 2015 12:30:00 PM

Earlier this month, Forbes ranked the five wealthiest hip hop artists. As fans of the genre might expect, Diddy, Dr. Dre and Jay Z comprised the top three. The only change in the order was found in numbers four and five, where Birdman slipped a notch.

The CEO of the Cash Money label had been hit with two IRS tax liens for unpaid taxes. The bill was around $2 million. Media outlets are reporting that the hip hop giant has written the federal agency a giant check, so maybe he'll reclaim his spot in next year's list.
As you likely know, a federal tax lien is a claim against your property when you don't pay taxes owed. The lien is placed after the IRS assesses your tax liability and sends you a demand for payment. If that demand is ignored, the agency can then file a notice of a federal tax lien to tell your creditors that the government now has a legal right to your property (can include real estate, a business, securities, personal property, etc.). A lien can affect your ability to get credit, sell property, declare bankruptcy and so on, complicating virtually every aspect of running a business.

The IRS has blunt advice for how to rid yourself of the lien: pay "your tax debt -- in full." Once you've done that, the IRS releases the lien within 30 days. In the case of Birdman, he wrote the IRS a check for $1,942,400.58. So his lien problems should be disappearing within a month. With a net worth estimated at $150 million by Forbes, he can probably afford the stiff bill.

A tax attorney and law firm experienced in negotiating with the IRS can help you find favorable resolutions to complex problems.

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