Here Is How You Can Discharge Your Tax Lien

How to Discharge Tax Lien

Tax liability is one of the big burdens that businesses must endure. Tax liens are certainly the biggest nightmares that a business will have to face. It is best to discharge tax lien as quickly as possible to prevent further problems.

What Exactly Is a Tax Lien?

Tax lien happens when the IRS or state authority takes control of a business’ assets to ensure that the tax liability is paid by the business. The most common reason for tax liens is a business’s inability to pay the tax amount as a result of financial problems, market downturns, and other similar factors.

If you suffer tax lien it does not necessarily mean that you will lose your assets. There is a neat way to discharge tax lien. You could use accounts receivable financing. It may seem that ‘accounts receivable’ and ‘tax lien’ are completely disparate terms. But the fact is that if you use the right finance option, then you can handle and discharge tax lien quickly.

Subordination

The procedure is quite simple. If you face a tax lien and wish to use accounts receivable financing, then the first step is to get subordination from the IRS. If your subordination request is approved, then the IRS will permit your finance firm to take the first position on your receivables. This simply means that your finance firm will be the first to receive collections from receivables. The IRS will then take its share of tax liability later on. Your finance firm will contact the IRS so that you can get your subordination.

This is an easy procedure because your finance firm will now handle the IRS and the collection of receivables. This way, your finance firm will help to pay off your tax liability and discharge your tax lien. If all goes well, your assets will be saved and your financial position may even improve.

The finance firm has a good idea of how to get subordination and how to expedite collections. Instead of worrying about debt collection, tax payments, and liens, you will now have more time and energy to focus on reviving your ailing business. If you try to do everything on your own, there is a real danger that your business could fail.

Lien Size

In general, the smaller the lien, the easier it is to work with the IRS. Your finance company will work with the IRS so that it issues a letter of understanding. If the letter is issued, your finance firm can make recoveries from receivables as long as you are regular with tax payments. With smaller tax liens, you may be able to establish a bigger reserve for installments. You will then find it easier to pay off your back taxes quickly. You might also avoid being in tax debt because it will be now easier for you to handle current taxes.

Finance companies examine tax liens on a case-by-case basis and may come up with valuable advice to reduce your tax lien or discharge it more quickly.     

KLB Business Funding is an ally of small businesses and will be most pleased to offer accounts receivable financing under easy terms and conditions. We offer cash in 24 hours. There are no personal guarantees and no recourse even if the account doesn’t pay. There are other benefits for you as well.

To find out more contact us today.

KLB Business Funding

3702 Pratt Avenue Bronx NY 10466

(347) 755-2257

info@klbbusinessfunding.com