Remove an IRS tax lien off your credit report in 10 STEPS

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From a Credit Guy Fan Whizzy

I thought I’d add a few comments for removing a PAID tax lien from your credit report instead of waiting 7 yrs for it to age off. I just went through this process and the lien has been completey deleted from our credit reports so I know it works.
1) We finished paying off our taxes per our installment agreement with the IRS.
2) Received IRS form 668(Z), Release of Federal Tax Lien, automatically from IRS once they processed our final payment.
3) Located IRS form 668(Y), Notice of Federal Tax Lien, sent to us when the IRS initially filed the lien with our county. This is crucial as Dave mentions in this video because it has the serial number of your original case file with the courts. If you don’t have it, go to the IRS first, then the courts as Dave mentions.
4) Located IRS form 12277 online and filled it out. Made sure that I checked the box indicating that the request was in the best interest of the government and the taxpayer.
5) Located and printed a copy of the notice from the IRS Newsroom dated 2/24/2011 in relation to the IRS’s new policy to withdraw paid tax liens
6) I wrote a cover letter including who, what, when, and why in relation to our request for the tax lien to be withdrawn, including a list of the 3 credit reporting agencies we wanted to be notified. I made sure to note both my SSN # and my spouse’s SSN # because the tax lien shows up on both our credit reports.
7) I enclosed the IRS form 12277, copies of IRS forms 668(Y) and 668(Z), and a copy of the IRS newsroom document from 2/24/11.
8) In about 2-3 weeks, we received IRS form 10916(c), Withdrawal of Filed Notice of Federal Tax Lien. This was our golden ticket!!
9) Although I asked the credit bureaus to be contacted, my local IRS office (Denver) indicated that they normally don’t do that. The information is deleted from the county records and the credit reporting agencies normally just pull from there so I did one more step as follows to expedite the process and make sure it was done.
10) We each contacted the 3 credit bureaus, disputed the lien, and provided a copy of IRS form 10916(c) that we received from the IRS in step 8 above. The credit bureaus verified the information and voila… the lien was completely deleted from our credit reports as if they never existed in the first place.

Woo hoo!! Refinance here we come… hopefully with a better FICO score.

http://www.irs.gov/newsroom/article/0,,id=236540,00.html?portlet=7

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Comments
  • grateful

    THANK YOU !!!! So glad I found this. You have helped me
    enormously !

    • http://www.facebook.com/thecreditguy Sully

      I am so pleased to help!!! good luck and let me know if I can help you in anyway!

  • Paul

    What would be an effective statement for Item#12 “Explain the basis for the withdraw request?

  • Jenn

    Dave I have a question for you. I have my form 668z which you know is my certificate of release. Do I contact the IRS for a copy of the original 668y? Then file both of them together with form 12277? PLEASE HELP ME!

  • Terrance

    What if your tax lien is from the state? Not federal tax lien. Is there a form that you need to fill out? Or are these the same steps to get that removed also?

    • http://www.facebook.com/thecreditguy Sully

      Sorry Terrance, this is only for IRS tax liens.

  • Terrance

    My tax lien is an irs tax lien. It was just given by the state instead of federal.

  • http://www.facebook.com/thecreditguy Sully

    Interesting Terrance,

    Then the same rules apply use the forms listed in the video and it should be removed. but I am not sure how this wrinkle will impact the removal, but is is very cheep to find out… please let me know how you do.

  • Terrance

    Ok Thanks

  • Dan

    I have 3 liens that need to be removed…Ive been paying on them for over 6 yrs and the statute is about to run on one of them. My question is that if I file a 12277 to have liens removed will they issue a new lien with a new processing date and therefore making the statue that much longer??

  • Vincent Seelan

    My Problem is I do not have a Tax Lien, but for some reason everytime my Credit check is done it always shows I have a CA State Tax Lien filed on me. Can you please help me on how to remove it.

    Thanks
    Vincent

    • http://www.facebook.com/thecreditguy Sully

      You have to check what your state California last I checked was 10 years contact the court and find out if you can correct it is it an error was it paid? watch this http://youtu.be/6QKbW4uZea0

  • http://www.thecreditguy.tv/how-to-remove-a-irs-tax-lean-off-your-credit-report-in-10-steps/ cindy

    What would be an effective statement for Item#12 “Explain the basis for the withdraw request?
    i didnt see a reply to this question i apologize if i missed it.

    • http://www.facebook.com/thecreditguy Sully

      “It would be in the best interest of the tax payer” I think is the correct choice… but it should be in the video…

  • Lynn

    THANK YOU SOOOOOOOOOOOO MUCH!! THIS HAS BEEN A BIG HELP!

  • Jeannie

    What is a proper response, wording, sample letter to question 12 on the form 12277?

  • Jordan

    I first sent the Credit Reporting agencies my 668Z to show the Lien Paid in Full? Or will this show up and stay on my Reports after I receive (hopefully) the “Withdrawal”? or would the Lien Paid in Full notations on the credit reports be removed as well? Obviously I want no mention of any Liens on my Credit Report. BTW, the Notice of Lien was filed after the IRS agent setting up my Installment Agreement on the phone insisted NO LIEN would be filed!

    • http://www.facebook.com/thecreditguy Sully

      You have to make the request with the IRS to get it removed. Then go to the bureaus with that documentation. Otherwise, it will show a paid tax lien for the next 7-10 years on your report. After 2-3 years it will have only a small impact on your credit score though. Any chance you could go back to the same IRS agent?

  • Paul

    How long does it take to receive the copy of form 10916? I received the approval letter from the IRS January 31 and still have not received the copy of the withdrawal form?

    • http://www.facebook.com/thecreditguy Sully

      Six to eight weeks… let me know if you get it sooner. thank you and Good Luck!!

  • Michael

    From the date I sent the form in until I got the Form 10916 A (today) was a total of 20 days!

    • http://www.facebook.com/thecreditguy Sully

      That Is Great!!!!! Thank you for telling us your experience! It really is not that hard.

  • Martha

    What if you paid your tax lien in full and not an installment? Will this still work?

    • http://www.facebook.com/thecreditguy Sully

      Yes. but only if it was an IRS tax lien…

  • Jeff G

    I received the 10916 in the mail today. It took 5 weeks from the date that I mailed the request.

    When I contacted the IRS agent to get a copy of the 668Y, they were able to do it over the phone. The agent agreed to fax it to me. What I received was another copy of the form 668Z. I decided to try sending just that form with the request, and it worked. I think that gave them enough to go on.

    Now on to the credit bureaus…

  • Julie

    Thank you so much for this valuable information. I received my 668Z last Tuesday and followed your directions in regard to the 12277 application. I mailed and faxed over 2 applications with my release last Wednesday, June 12th and received approval letters for BOTH applications in the mail Tuesday, June 18th!!! The letters said my 10916(c) is on it’s way :) I’m so happy and so thankful you put this information out here! I didn’t even know I could have the slate wiped completely clean! THANK YOU!!!!

  • jeff

    I received my 10916 withdrawal form, ready to send a copy to the 3 bureaus, do I just send right to the PO Box address that each agency lists on their website contact info?

    • http://www.facebook.com/thecreditguy Sully

      yes but keep a copy for your records

  • Diane

    This is so so so very helpful! I just reached a settlement agreement with the IRS. I have had a tax lien on my credit report for 2 years; once I have the IRS documents acknowledging an agreement, do you know if submitting the agreement to the credit agencies will help my score? The installment agreement is for an additional year.

  • Max Fritts

    I have a state tax lien against me in the state of Georgia from the yr of 2007… if I don’t pay it will it be gone off my credit report in 2014? Please reply…I really need help with this.thank you,
    Max

    • http://www.facebook.com/thecreditguy Sully

      State Tax Liens are different by state. some will stay on forever some will fall off in the normal 7 year process.. you have to check with the state.. from a score perspective it is not hurting you that much because it is so old so it comes back to what are your goals for your credit ?

  • Elizabeth latiolais

    Does this work if it has been released due to statue of limitations ran out.

    • http://www.facebook.com/thecreditguy Sully

      Elizabeth,

      Not sure I would try it and let me know please

  • David

    I have filed chapter 7 and have had most of the past IRS debt discharged and would like to know if the lien can be removed or released. Thank you in advance.

    • http://www.facebook.com/thecreditguy Sully

      It can be!!!! Follow the instructions in the videos :)

  • Barbara

    Hello! I am so impressed with all of your info. Here is my problem. In June of this year the IRS put a lien on our business. We have the funds to pay it but have been told that it can not come off of the clerks record. I live in Volusia County Florida. As much as I don’t want the business name there it also has it listed as the owners name and then the business. Just need to remove the owners name or both if possible. Like I said the lien was placed in June and I am planning the pay off tomorrow. ($72K)

    • http://www.facebook.com/thecreditguy Sully

      Barbra,

      They are correct It will not be removed off the clerk’s record but If it is a IRS federal tax lien then IT can be removed from the credit report. just follow the steps in the video and you will be fine. If you are paying tomorrow ask them for the 688Y form.

      You can do it !

      Dave

  • Reneth

    Thank you so much Dave! This helped my wife out greatly! This the 3 third year since my wife’s Tax lien was paid in full and we wanted to refi our mortgage at a lower interest rate and would have had to wait for 7 more years. Thanks to your instructions, we received a letter from the IRS today approving the withdrawal.

    • http://www.facebook.com/thecreditguy Sully

      That is great! Let me know if you would like to tell your story of success.

  • David

    This process does work. My Experian score went up 128 Pts! when the lien was removed. Great information!

  • http://www.thecreditguy.tv Eric

    IRS Fresh Start Question

    I followed your instructions on filing for withdrawal of a tax lien; however, the IRS responded stating that I do not qualify because the two liens are in an active ch. 13 bankruptcy. I am 3.5 years into a 5 year plan. I did not see any documentation on the IRS site stating that would disqualify me?

  • Peggy

    I have done this, sent it to the Taxpayer Advocate but they knew nothing of this, I even sent them the IRS news release and they would not do it. Is there another address the information is to be sent to?

    • http://www.facebook.com/thecreditguy Sully

      Peggy,

      This is the first time I have heard of this, be sure to mention the Fresh Start Program when you go to another tax office.

      Keep fighting

      Dave

  • Evelyn

    I’m currently awaiting my Form 10916, didn’t know about this website though. Has anyone seen a drastic change in their credit scores after submitting this to the credit bureaus? If so, by how many points were you affected?

    • http://www.facebook.com/thecreditguy Sully

      It will depend on how recent the tax lien is and what your credit score is now expect at least some improvement on all removals.

  • Gary

    Ok I have the form 668(z)copy that was filed by the IRS . I had to go and get a copy from the Recorders office. So therefore it is no longer on public record. Now can I just dispute the the tax lien and have the credit reporting agency remove it from my credit report once they see that it is no longer on record. Or do i still have to show them proof.

    • http://www.facebook.com/thecreditguy Sully

      You don’t dispute it the IRS will alert the bureaus for the removal watch this video toward the end for info on that

  • Gary

    How should the letter to the Credit reporting agencies to remove the tax lien read? Thanks for all help

    • http://www.facebook.com/thecreditguy Sully

      Just explain the situation and make sure to reference the “fresh start program” be sure to word it like you are asking for a favor…