Below please find the transcript of an e-mail exchange that I recently had with Attorney Gary Moore on the subject of clearing up a State tax lien. Unfortunately we could not identify the original source of the question, so if any of you know please pass along this information.
Thank you for your attention.
Mazyar M. Hedayat, Vice Chair
DCBA Bankruptcy Law Subcommittee
Re: IDOR Tax Liens
My client has a Chapter 7 Discharge and a letter from the IDOR that states that his Illinois tax debts are discharged. But the IDOR will not release its tax lien. Now, years later, the client wants to purchase a home, but his lender says the lien must be released.
– posted by John @ 7:17 AM
1. Try having client purchase house using a land trust.
2. Give copy of discharge and letter from IDOR to title company for recording.
3 Talk to the lender. If the debt is really discharged the lien could not affect property the debtor did not own when the lien was filed.
All the suggestions you record below are pretty good ones. At the end of the day the real problem is not necessarily the IDOR or even anything related to the Bankruptcy. The real sticking point is the lender, and if they have knowledgeable Counsel then he/she should recognize this situation for what it is. You may also wish to demand that the credit reporting bureaus (Equifax, Trans Union, etc.) erase the Lien information from the Client’s record as inaccurate. THis should take about 40 days — if the credit reporting agencies comply, which can be a haphazard outcome. It also seems more than likely that the IDOR would be willing to issue a Release of Lien (if in fact they previously agreed to forgo this obligation). Let me know if you need any more perspective on the subject.
Mazyar M. Hedayat, Esq.