Having an IRS tax lien on your credit record can be devastating. Because it can stay on your record up to seven years after you pay off or settle the amount, you may have a difficult time getting financed for loans, credit cards, and other financing.Rather than face seven years' worth of credit challenges, you can protect your score and your record by handling your IRS debt through other means. You can also restore your record by learning how to have the IRS lien removed from your credit report permanently.

Avoid an IRS Lien

The IRS must collect on every dollar owed to the government. If you owe taxes, you can settle your debt before a lien is put on your assets through several different means.

The available options for eliminating your IRS debt include:

• Making an Offer in Compromise: This option essentially settles the debt for less than what you actually owe. It is reserved for people who cannot pay the debt in entirety and lack the assets to settle the account entirely.
• Making Payment Arrangements: If you are not eligible for an Offer in Compromise, you can set up a payment arrangement. An arrangement allows you to make affordable payments each month until the debt is paid.
• Paying the Debt in Full: If you can afford to pay your IRS account in full, you can write a check or use your credit card to settle the account. This means is the most effective in bringing your balance down to zero and curing your debt with the IRS permanently.

These options allow you to avoid the IRS garnishing your wages and putting a lien on your assets.

Removing the Lien from Your Credit Report
If you failed to take advantage of one of these payment options and instead had your account settled through a lien, it is important that you learn how you can remove it from your credit record quickly. The lien's presence on your record can have lasting repercussions on your finances until it is removed by the credit bureaus.

To remove this lien, you must make use the IRS' Fresh Start program, which was introduced in 2011. This program allows you to have the entry taken off your report as long as the debt has been satisfied.

It is important to note that the IRS will not offer you the chance to utilize this program. You must make the request yourself by calling the IRS or by visiting the IRS' website and following the Fresh Start program instructions.

Taking advantage of this program begins by printing off and completing IRS Form 12277. It is important that you complete this form precisely so you avoid a delay in your request's processing. It is also vital that you write in Fresh Start in response to Question 12, as this indicates that you would like to have the lien removed from your report.

After you complete the form, you should then:

• Send it to the IRS via certified mail
• Await an official response from the IRS, which can take more than 45 days in some cases
• Begin to dispute the lien with the three credit bureaus

When you notify the three credit bureaus that you want the lien removed, they will verify this information with your local courthouse where the judgment was entered. If the information can be verified, the bureaus should remove the report entirely.

If the bureaus notify you that they cannot verify the information or that they cannot remove the report, you should file a second request in writing. You may prefer to wait to file the second request until you have received official documentation from the IRS that your account has been paid off and that it granted your request to take part in the Fresh Start program.

A tax lien on your credit report can have long-lasting consequences on your finances. You can restore your good credit by learning how to deal with your IRS debt head on and removing the lien from your report permanently.