Tax liens have historically been one of the most damaging items on a credit report. However, significant changes in 2018 altered how tax liens are reported by the major credit bureaus.
The 2018 NCAP Policy Change
📌 What Changed: In April 2018, all three major credit bureaus implemented the National Consumer Assistance Plan (NCAP). Tax liens must now include the consumer’s name, address, and either SSN or date of birth. Since most public records don’t contain this information, the vast majority of tax liens were removed from credit reports.
When Tax Liens May Still Appear
Despite the NCAP changes, some tax liens may still appear if they meet the data requirements. Common errors include:
- Released liens still showing as active
- Incorrect lien amounts
- Liens that don’t meet NCAP data requirements — these should have been removed
- Tax liens belonging to someone else — mixed file
- Duplicate entries
How to Dispute a Tax Lien
- Verify the lien status with the taxing authority — obtain proof of payment, release, or withdrawal
- Dispute with each bureau — provide copies of the lien release, payment receipts, or IRS/state tax authority correspondence
- Reference the NCAP requirements — if the lien entry doesn’t include your full identifying information, request removal based on NCAP standards
IRS Tools That May Help
The IRS offers programs including:
- Lien withdrawal — removes the public notice of the lien (Form 12277)
- Lien discharge — releases the lien from specific property
- Lien subordination — allows other creditors to move ahead of the IRS lien