Nevada Tax Liens: What a Lien Means and Your Options
A tax lien is the government's legal claim against your property for an unpaid tax debt. It isn't the same as the government taking your property, and there are options to release, discharge, subordinate or withdraw a lien depending on your situation.
Tax liens hit Las Vegas business owners hard. A restaurant owner in Spring Valley behind on sales tax. A contractor in North Las Vegas behind on federal payroll taxes. A homeowner in Summerlin who finds out at a refinance that a lien is sitting on title. The first step is knowing which agency filed the lien and what it actually does.
Who files tax liens against Nevadans?
Two main sources: The IRS, for unpaid federal taxes like income tax or payroll tax; and the Nevada Department of Taxation, for unpaid state-administered taxes and fees, such as sales and use tax or the Modified Business Tax.
Nevada doesn't have a state personal income tax, so most individual liens here are federal. Business owners can face both.
How does a Nevada state tax lien work?
If a tax or fee administered by the Department of Taxation isn't paid when due, the Department may, within 4 years after the due date, record a certificate of delinquency with a county recorder, such as the Clark County Recorder (NRS 360.473).
From that filing, the amount due, including interest and penalties, becomes a lien on all real and personal property you own in that county, plus property you acquire later. It has the effect and priority of a judgment lien and lasts 5 years unless released, and the Department can extend it for additional 5-year periods by recording a new certificate (NRS 360.473).
The Department can also release or subordinate a lien (NRS 360.475).
How does a federal tax lien work?
According to the IRS, a federal tax lien arises when the IRS assesses the tax, sends a notice and demand for payment, and the bill goes unpaid. The IRS may then file a public Notice of Federal Tax Lien, which alerts creditors and can affect your ability to borrow.
Is a lien the same as a levy?
No. A lien secures the government's interest in your property. A levy actually takes property, like a bank account or wages, to pay the debt. The IRS draws the same distinction. A lien is serious, but it's a different stage than a levy.
What are my options with a federal lien?
The IRS describes several (source):
| Option | What it does |
|---|---|
| Pay in full | The IRS releases the lien within 30 days after the debt is paid |
| Discharge | Removes the lien from a specific property, for example to sell a house |
| Subordination | Keeps the lien but lets another creditor go ahead of the IRS, which can help with a refinance |
| Withdrawal | Removes the public notice; you still owe the debt |
| Appeal | In certain circumstances, challenge the lien filing through the IRS Office of Appeals |
One withdrawal path applies to taxpayers who owe $25,000 or less and enter a direct-debit installment agreement, subject to conditions the IRS lists. Check the current IRS requirements before relying on any one option.
What should I do if I just found a lien?
- Get a copy of the recorded lien or notice and identify the agency, tax type and periods
- Pull your account transcripts or Department of Taxation account history
- Check whether returns are missing; unfiled returns often drive the balance
- Don't ignore notices; deadlines to appeal or respond can be short
- If you're selling or refinancing in Henderson or Summerlin, raise the lien with your title company early
Can a lawyer help with a tax lien?
A lawyer can help you figure out which options fit, communicate with the agency, request releases or subordination, and coordinate with your CPA on missing returns. For business owners, that often goes hand in hand with private counsel on the business side.
New clients can also get a free simple will through our sister firm, Signature Law (signature.law).
This article is general information, not legal advice. Reading it does not create an attorney-client relationship.
Frank Stucki, Esq., MBA
Born and raised in Las Vegas. Trial lawyer for the seriously injured. Frank is licensed in California, Nevada, Washington and Utah; cases in other states are handled with local co-counsel licensed there.
Frank's full story