You betcha! The IRS and the State Tax Division has the right to confiscate your right, title and interest in any asset you own, including your car. That does not mean they will seize your vehicle and sell it, although they do have the right to do that. The IRS and the State Division of Taxation both know that in all likelihood you need your car or other vehicle to get to work and make a living. And if you are not earning money, that really does not help that out. While seizure of your vehicle is rare, back taxes can still make owning a car difficult.
First, with a lien on it, you will not be able to sell it or trade it in when you are ready for a new vehicle unless you pay your lien off first. Or you can negotiate selling the vehicle but you will have to turn over the proceeds to the IRS.
The second way back taxes make life difficult is with a tax lien on the vehicle, the Motor Vehicle Commission will not allow you to register your vehicle unless there is a release of the lien. Since we tend to wait until the last month to register our cars before the registration expires, we are stuck with either not being able to drive or risk driving an unregistered vehicle and being subjected to fines and penalties if we get caught.
So what is the option? By contacting a tax resolution law firm like Tomes Law Firm, we can work out a resolution for your back taxes which would result in the lifting of any liens, and hopefully the prevention of the filing of the liens in the first place. The time to act is when you receive your first notice of back taxes owed, called a CP 2000 notice. Don’t wait until you receive the notice of levy. While we have helped many of our clients get their vehicles registered with a lien, it is not easy and costs more money By waiting you make it less likely that you can have every option available to you to resolve your back taxes. Call us today at 833-4IRS-TAX for a free strategy consultation.