The Georgia Department of Revenue (GADOR) can file a state tax lien to protect its interest in collecting delinquent tax debt. The lien will encumber all of your property and can be recorded with a Clerk of Superior Court as a matter of public record.
Impact of Georgia Tax Liens
The tax lien will make it difficult to sell, refinance, or borrow against your property. The lien remains in effect after a sale unless GADOR agrees to release, so a buyer would have to take your property subject to the lien.
If you need to get around the state tax lien to make a sale or get a loan, you have a few different options.
Pay Off Your State Tax Debt
The lien with be canceled if you pay off your state tax debt in full. You’ll be able to sell your home or refinance without worrying about the state tax lien.
If you can’t pay your full balance right away, but still want to avoid the impact of the tax lien, you’ll have to consider some other strategies.
Partial Lien Release
GADOR may agree to release the lien from a specific piece of property. However, you will generally be expected to provide compensation in order to get this release.
If you agree to pay a sum towards your tax debt in order to complete a transaction, GADOR may approve the partial lien release.
If you just want to refinance your home, a lien subordination may be sufficient. In this case, GADOR keeps its lien interest, but agrees to give another creditor a superior interest in your property.
To receive a lien subordination, you’ll need to either pay off a portion of your tax debt equal to the lien interest being subordinated or show that the subordination will be in GADOR’s best interests. The second situation could apply if you’re refinancing at a lower rate and will have more income to pay towards your state tax debt.
Other Lien Avoidance Options
You can also claim that a GADOR lien was filed improperly or that the statute of limitations has expired, making the lien unenforceable. A Georgia tax attorney can help you determine the best way to reduce the impact of a state tax lien.
Get help with Georgia state tax liens by calling The Gartzman Law Firm at (770) 939-7710.