High Interest Loan vs. Federal Tax Lien

**creditcardfree** · 06-08-2009, 01:47 PM

What do you mean by burdensom?

Another option would be to find a lender for the $19K and continue on payments for the older back taxes.

Personally, I wouldn't want to owe any back tax money to the IRS. So, I would look at a loan for the whole thing.

**canadamom** · 06-11-2009, 06:15 AM

I do a job where I see tax liens every day. I would NOT go that route. Ever if possible. The amount of people that know and see and use that information is HUGE. Any lender would not publish it. Tax liens are VERY public.

**Ima saver** · 06-11-2009, 12:00 PM

I would get a loan also.

**wilson9975** · 08-06-2009, 10:12 PM

Originally posted by kevincal View Post

I'm currently on a fast-track payment plan with the IRS for about $20k due to back-taxes going all the way back to 2004 (paying $500/mo).

I own a business and last year put more cash into when I should have put towards estimated taxes. Situation now is I owe about $19k for 2008.

Question is: Do I fold the $19k into the $20k at take the federal tax lien, or is it better from a financial planning perspective to try to find a lender for $40k and pay the entire balance off even though the interest rates will be burdensome.

Thanks for any assistance you can provide..

Cheers,

-Kevin

Hi,

Publicly filing a lien can have a negative effect. It can damage your credit score, making it harder, more expensive, or even impossible to get a loan, mortgage or other credit. Interfere with, complicate, or wreck your efforts to sell property, and, imagine an agent from the IRS showing up at the closing when you sell your house or apartment demanding the IRS's piece of the proceeds. It also makes you ineligible for certain jobs.

High Interest Loan vs. Federal Tax Lien