Federal Tax Lien and IRS Form 12277

By | March 23, 2015

What form needs to be filled out by the taxpayer to request a Lien Notice withdrawal?

You will need Form 12277 called Application for Withdrawal of Filed Notice of Federal Tax Lien.   The form is two pages long.   Page one you fill out and send to us.   Page two has the instructions for the form.

Part 9 asks you to provide a copy of the filed notice you’re asking to be withdrawn or information from the notice.   Providing this information will move your application along faster, especially if there’s more than one notice filed.   If you have kept a copy of the Lien Notice the IRS sent you when they filed the notice, you could use that to attach with your Form 12277.

Part 10 is asking if your tax debt still exists and whether a notice of the lien’s existence has or has not been released.   So, the choice is Open, Released, or Unknown.   Open means the notice is still on file and taxes are still owed.   If the taxes and the lien have been satisfied or the time period the IRS is given to collect the debt has run out, you would check the Released box.   If you are not sure what the situation is, check the box for Unknown.


Requesting Tax Lien Withdrawal

If you are requesting withdrawal because the notice was filed too soon, check the first box.   An example of this would be if the notice is filed after you have filed bankruptcy.   Here’s an important tip.   Be sure to include a separate Form 12277 for each request where you feel the notice was premature.   The second box in part 11 would be checked if you have an installment agreement but the IRS did not tell you about filing a Notice of Federal Tax Lien.   Furthermore, if you are under a Direct Debit Installment Agreement and meet the criteria for a withdrawal of your notice, be sure to check the Direct Debit box.   The next box in part 11 is for requesting the IRS withdraw your notice because it will make collection easier.   Check the last box you see here if you are requesting the IRS withdraw your notice because it is in yours and the government’s best interests.   This is also the box you would check when requesting the IRS withdraw the notice even though the lien and the notice have been released.


Avoiding a Federal Tax Lien

You can avoid a federal lien presenting and paying their taxes in full and at time. If you cannot submit or pay on time, do not ignore the correspondence that you receive from the IRS. If you cannot pay the amount owed in its entirety, there are payment options that can help you resolve your debt tax over a period of time.


Submitting Form 12277

Send your Form 12277 to the IRS office assigned to your case or to the local advisory group manager.   You can find the addresses in Publication 4235.   We’ve included a hyperlink next to the video you are now watching.   After the IRS receives your form, they will contact you.   If they agree with your request and withdraw your Lien Notice, they send you a copy of the notice withdrawal and notify the third parties you included with your request.


IRS Form 12277

If we turn down your withdrawal request, you’ll get a letter telling you IRS has rejected your request, along with Publication 1660, which explains your appeal rights.   The first thing to do if you disagree with our decision is to contact the manager who signed the letter.


Contacting IRS About Tax Liens

You can speak directly to an IRS expert in lien withdrawals.   They’re known as advisors and work out of our collection division.   IRS Publication 4235 has all their addresses and local phone numbers.   Download the collection advisory group addresses publication at IRS.gov or call 1-800-TAX-FORM to have one mailed to you.   And for more general information, you can always visit our website, IRS.gov, and type “lien,” L-I-E-N; in the search box to see everything we’ve talked about today.   The search results include a website and a series of videos with this information and instructions from the IRS appeals site on how to appeal a collection decision.