How Tax Debt Financing Works — 4 Steps From Application to IRS Payoff

Simple. Clear. 4 Steps.

Tax Funds connects businesses that have IRS or state tax debt with specialty lenders that will pay off that debt in exchange for a business loan. No negotiation with the IRS. No OIC waiting game. The IRS gets paid in full, the lien is released, and you repay the lender over time.

Step 1: Submit Your Information

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Complete the form — 3 minutes, no hard credit pull

Tell us about your business, your approximate IRS or state tax balance, and your monthly revenue. This is a soft inquiry — there is no hard credit pull at this stage, and submitting information does not affect your credit score or notify the IRS.

You will need to know approximately: how much you owe the IRS (available via your IRS Online Account or by calling the IRS), your average monthly gross revenue, and how long you have been in business.

Step 2: Specialist Review and Lender Matching

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A Tax Funds specialist contacts you within 1 business day

Within one business day, a Tax Funds specialist will contact you to review your file. The specialist will ask for any additional documentation needed — typically IRS transcripts, recent business bank statements, and a copy of any IRS notices you have received. This call usually takes 15–30 minutes.

The specialist then matches your file with lenders in the Tax Funds network who have active programs for your type of tax debt (941 payroll, income tax, state tax), debt amount, and business profile. This is not a generic referral — we match based on which lenders have actually funded similar scenarios.

Step 3: Lender Underwriting

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Lender reviews, issues a term sheet, and initiates IRS coordination

The matched lender underwrites your file — typically reviewing 3–6 months of bank statements, the IRS payoff amount, and business financials. Underwriting focuses on whether current revenue can support loan repayment — not on your traditional credit score or pre-lien credit history.

If approved, the lender issues a term sheet specifying the loan amount, interest rate, term, and repayment structure. You review and accept — with no obligation until you sign. The lender then initiates the IRS lien subordination process (for IRS debt) or prepares the state tax payoff (for state debt). This phase typically takes 5–15 business days.

Step 4: IRS Payoff and Lien Release

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Funds wire to the IRS — lien released within 30 days of payoff

Once the IRS processes the subordination certificate (or the payoff is coordinated directly), the lender wires the full payoff amount to the IRS. The IRS is legally required to release the Notice of Federal Tax Lien within 30 days of receiving full payment. The lien release certificate is recorded publicly — removing the NFTL from public record. Enforcement actions stop. You begin repaying the lender per the agreed schedule.

Who Qualifies

Tax lien financing through Tax Funds is available to businesses that meet the following general criteria:

Criteria Typical Requirement
Tax debt amount $25,000 minimum
Business status Active and operating (not in bankruptcy)
Monthly revenue Sufficient to support loan repayment
Time in business Generally 2+ years (exceptions for strong revenue)
Tax type IRS 941, IRS income tax, state payroll, state sales tax, franchise tax

What Tax Funds Is — and Is Not

What Tax Funds IS

  • A financing marketplace that connects businesses with specialty lenders
  • A way to pay the IRS in full and release the federal tax lien
  • A fast-track solution when conventional financing is blocked
  • A bridge to restored credit access after lien release

What Tax Funds is NOT

  • A tax resolution or negotiation service
  • An Offer in Compromise processor
  • A direct lender — we match, we do not fund
  • A way to reduce what you owe the IRS

Start Step 1 Now — 3 Minutes, No Hard Credit Pull

A specialist will contact you within one business day to review your situation and begin lender matching.

Tax Funds is a financing marketplace, not a direct lender. We connect businesses with lenders that specialize in tax lien scenarios. Rates and terms vary by lender and are disclosed before you accept any offer. This is not tax or legal advice.