Legal Question in Bankruptcy in California

1) If your tax liability gets discharged in a chapter 7 bankruptcy what are the criteria that the IRS uses to determine whether to remove the federal tax lien?

2) If the IRS refuses to remove the federal tax lien what are the criteria that courts use to determine whether to remove the federal tax lien?


Asked on 12/31/11, 4:04 pm

2 Answer from Attorneys
Tony Carballo Carballo Law Offices

Once an IRS lien is filed the tax debt becomes secured by everything you own in the world including retirement plans. Therefore, it is not removed by the Chapter 7 bankrutpcy case. Liens rights are not affected by Chapter 7. The lien is valid for 10 years. Sorry for the bad news. The IRS may remove the lien if it determines that you have nothing substantial that can be taken from you. You need to deal with the IRS on this. Recently the IRS stated that it will not be filing small liens (under $10,000 I think) and may remove liens if a payment plan is worked out. There is also the possibility of an offer in compromise of the debt for a lot less than owed.

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Answered on 12/31/11, 5:11 pm


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