The IRS has filed federal tax liens against Zolciak-Biermann, 44, and her husband, 37, totaling $1,147,834.67, according to Forbes. A state tax lien for 2018 worth over $15,000 was also reportedly filed by the state of Georgia.
PEOPLE reached out to the IRS for confirmation of the federal liens against the couple, but was told in a statement: “Federal law prevents the IRS from confirming or denying correspondence with any taxpayer or case, nor does the IRS comment.”
The IRS describes a federal tax lien as “the government’s legal claim against your property when you neglect or fail to pay a tax debt. The lien protects the government’s interest in all your property, including real estate, personal property and financial assets.”
If you fail to pay off your tax debt, the IRS can issue a Notice of Federal Tax Lien to alert creditors that the government has a legal right to your property. If you eventually have to sell your assets, the IRS is entitled to claim some or all of the proceeds to satisfy your debt.
In a worst case scenario, the IRS can also issue a levy if you fail to make arrangements to settle your tax debt, where it can seize and sell any type of real or personal property that you own or have an interest in.
It is unclear what the ‘Don’t be Tardy’ couple’s next move will be — but if the reports are true, they’ll be under immense pressure to pay their debts and clear the lien while going through their divorce — a tricky feat, considering they’re “not on good terms right now,” according to the source that spoke to PEOPLE.
The best way to get rid of a federal tax lien is to pay off your tax debt in full. If you can’t file or pay your taxes on time, there are payment options available to help you settle your tax debt over time — but you need to cooperate with the IRS.
The tax agency can also withdraw a lien (but you still have to pay your debt, or remove the lien from a specific property, or they can apply ‘subordination’ which allows other creditors to move ahead of the IRS in recovering debts.
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How can a tax lien impact you?
A federal lien can impact you in many ways. It attaches to your assets (including property, securities and vehicles) and to any future assets acquired while the lien is in place. It also attaches to all business property that you may have and to all rights to business property, including accounts receivable.
If your tax debts are extreme, you might have to sell your home or other real estate to get out of the hole. This could be problematic in the case of the Biermanns, whose Alpharetta mansion was placed under foreclosure by Fulton County, Georgia, after they defaulted on a $1.65 million loan they took out for the property in October 2012.
Zolciak-Biermann labeled the foreclosure a “misunderstanding” and she slammed the idea that the property would be auctioned off, sharing a message to her “haters” over Instagram: “If you guys think I would let my home that we've put millions and millions of dollars into go for $257,000, you're an idiot, OK? For real.”
The celebrity couple ultimately kept their home, which means it could be targeted by the IRS under a federal tax lien.
Once the IRS files a Notice of Federal Tax Lien, it can also limit your ability to get credit, a mortgage, or other loans.
While the IRS cannot report your tax debt directly to consumer credit bureaus due to protections in the Taxpayer Bill of Rights, your debt becomes public record once a Notice of Federal Tax Lien has been filed.
This means that lenders and credit card companies can easily find out if you’re in the red and they can choose to reject your request to borrow money.
Finally, a tax lien is not easy to shake off — even if you declare personal bankruptcy, which is not uncommon for people deep in debt or going through a divorce. The IRS says your tax debt, lien, and Notice of Federal Tax Lien may continue after the bankruptcy, so you have to factor this into your plans.
If you’re in this situation, it may help to work through your troubles with a tax expert or financial planner, who can help you create a repayment roadmap.
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