Tax Lien North Carolina
A tax lien in North Carolina is a state-issued request to levy on and sell any personal property owned by a taxpayer who has failed to pay tax, penalty, interest and fees that have been assessed by the North Carolina Department of Revenue.
Tax Lien North Carolina process
If you have received a Notice of Collection, then an assessment against you has become final and collectible. Your account has been assigned for collection. If the liability is not paid, the North Carolina Department of Revenue may pursue one or more of the following collection options:
- File a Certificate of Tax Liability (i.e., a lien on your property).
- Issue a Tax Warrant directing the sheriff or a designated employee of the Department of Revenue to levy upon and sell your property.
- Attach and Garnish your wages, salary or bank deposits.
- Where criminal tax proceedings are initiated, request payment of taxes as a condition of any plea arrangement or as restitution upon any conviction.
If the Department of Revenue pursues the collection options set out above, the following options or remedies are available to you:
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- You can end the attachment and garnishment of your wages, salary, and bank deposits and the seizure of your property by making full payment of the assessed liability.
- You can secure the release of a Certificate of Tax Liability by making full payment of the assessed liability.
- You can seek the release of a Certificate of Tax Liability (CTL) if one of the following conditions are met:
- The judgment was filed in error.
- The liability has become unenforceable due to the lapse of time.
- The CTL is creating an economic hardship for you.
- The fair market value of the property exceeds the tax liability and release of the CTL on part of the property would not hinder collection of the liability.
- Releasing the CTL would increase the State’s chances for collecting the tax.
- You can seek to enter into an installment payment agreement.
- In the event criminal tax proceedings are initiated, you should contact your attorney and the prosecutor to determine your options.
North Carolina tax liens and other Collection Actions
If you have a past due balance, the Department of Revenue may do any of the following:
- Attach and garnish your bank account to pay taxes due.
- Attach and garnish 100% of any payments received as a result of the contract as well as any commissions.
- Attach and garnish the wages owed to you by an employer. Wage attachments and garnishments are 10% of a taxpayer's gross income until the tax liability has been settled. Non-wage, contract and bank attachments and garnishments are issued at 100% of the liability due until the tax liability has been settled.
Attachment and garnishment payments withheld should be remitted to the Department of Revenue every 30 days until the liability shown due on the attachment and garnishment together with accrued interest is paid in full.
Offer In Compromise with the State of North Carolina
The Secretary of Revenue with the approval of the Attorney General to accept full settlement of a liability for a lesser amount than is due when in their opinion it is in the best interest of the state.
You may be a candidate for offer in compromise if you meet 1 of the 4 conditions listed below:
- There is a reasonable doubt as to the amount of the liability of the taxpayer under the law and facts.
- The taxpayer is insolvent and the Secretary probably could not otherwise collect an amount equal to or in excess of the amount offered in compromise.
- Collection of a greater amount than that offered in compromise is improbable and the funds or a substantial portion of the funds offered in the settlement come from sources from which the Secretary could not otherwise collect.
- A federal tax assessment arising out of the same facts has been compromised with the federal government on the same or a similar basis as that proposed to the State and the Secretary could probably not collect an amount equal to or in excess of that offered in compromise.
Upon acceptance of the offer, the Department requires payment of the settlement amount in full. The Department will not accept a "zero dollar" offer.