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Published:   |   Last Updated: October 12, 2023

Withdrawal of Notice of Federal Tax Lien

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Lien Withdrawal Overview

There is a difference between a lien release and a lien withdrawal. A lien is released when the tax debt has been satisfied. A lien withdrawal removes the effects of a publicly recorded Notice of Federal Tax Lien (NFTL) when taxes are still owed.

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What does this mean to me?

The IRS has filed a NFTL for unpaid tax balances. 

Paying the tax balance in full can stop other collection actions. 

The NFTL is a public record that can affect you and your property and assets. 

How did I get here? 

When you don’t pay your taxes, the IRS can file a public document with the local and/or state authorities.  

When the NFTL is filed, it alerts creditors you owe the government. 

The NFTL secures the priority of the government’s claim to your current and future property and assets until the balance is paid in full. 

While NFTLs no longer appear on credit reports, they may still affect your ability to get credit if a potential creditor uses other resources, such as public records, to discover the NFTL. 

What are my next steps?

When a NFTL is filed because you owe taxes, the IRS can withdraw it from public record under certain conditions. 

Conditions the NFTL can be withdrawn are: 

  • When the NFTL was filed before the IRS could file a lien or it wasn’t filed correctly. 
  • If you have an installment agreement (IA) that will full pay the taxes owed, and the NFTL was not a condition of the IA. 
    • If an IA defaults, a new NFTL can be filed. 
  • If withdrawal will facilitate the collection of tax. 
  • You, or the Taxpayer Advocate acting on your behalf, believes withdrawal is in the best interest of the taxpayer and the government.

To apply for a lien withdrawal after the tax is full paid and the lien was released, then you must make the request in writing and have submitted all your required tax returns including current estimated tax payments, if applicable. 

To apply for withdrawal of the NFTL, submit Form 12277, Application for Withdrawal of Filed Form 668(Y), Notice of Federal Tax Lien (Internal Revenue Code Section 6323(j).

The IRS will notify you by letter if your application was accepted or denied. 

If your application is denied, you can request a conference with the IRS Independent Office of Appeals using a Form 9423, Collection Appeal Request. See Publication 1660, Collection Appeal Rights, for full explanation of the Collection Appeal Program. 

There are other types of lien relief the IRS offers. See Lien Relief for more options. 

Where can I get additional help?

Get Help topics

Browse common tax issues and situations at Get Help on the Taxpayer advocate Service’s website.

If you still need help

The Taxpayer Advocate Service is an independent organization within the IRS that helps taxpayers and protects taxpayers’ rights. We can offer you help if your tax problem is causing a financial difficulty, you’ve tried and been unable to resolve your issue with the IRS, or you believe an IRS system, process, or procedure just isn’t working as it should. If you qualify for our assistance, which is always free, we will do everything possible to help you.

Visit www.taxpayeradvocate.irs.gov or call 1-877-777-4778.

Low Income Taxpayer Clinics (LITCs) are independent from the IRS and TAS. LITCs represent individuals whose income is below a certain level and who need to resolve tax problems with the IRS. LITCs can represent taxpayers in audits, appeals, and tax collection disputes before the IRS and in court. In addition, LITCs can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Services are offered for free or a small fee. For more information or to find an LITC near you, see the LITC page on the TAS website or Publication 4134, Low Income Taxpayer Clinic List.

Related Letters & Forms

  • Form 668 (Y)(C), Notice of Federal Tax Lien
  • Form 10916, Withdrawal of Filed Notice of Federal Tax Lien 
  • Form 10916-A, Withdrawal of Filed Notice of Federal Tax Lien after Release 
  • Form 12277, Application for Withdrawal of Filed Form 668(Y) Notice of Federal Tax Lien (as based on Internal Revenue Code Section 6323(j))

Taxpayer Rights

The Right to Be Informed

The Right to Appeal an IRS Decision in an Independent Forum

The Right Privacy


Where am I on the tax system?

Withdrawal of Notice of Federal Tax Lien (NFTL)