Does Owing the IRS Affect Your Credit Score?

If you’ve fallen behind on your taxes, you may wonder whether that unpaid balance could harm your credit. After all, most types of debt can show up on your credit report and bring your score down. The good news is that owing money to the IRS does not directly affect your credit score, but there are still ways it can hurt your financial standing if left unresolved.

What the IRS Reports (and Doesn’t Report)

The IRS does not report unpaid taxes to the three major credit bureaus (Experian, Equifax, and TransUnion). This means that even if you owe a large balance, it won’t appear on your credit report and won’t directly lower your credit score.

In the past, the IRS could file a Notice of Federal Tax Lien, which did show up on credit reports and could drop a person’s score by hundreds of points. However, since 2018, credit bureaus have removed all tax lien data from consumer credit reports. So, while a lien may still exist as a public record, it won’t be visible through your credit report anymore.

Get Help Before the IRS Takes Action

While owing taxes won’t directly lower your credit score, ignoring your IRS debt can lead to consequences that do. If you’ve received notices from the IRS or are worried about potential collection actions, professional help can make all the difference.

At the Law Office of Steven N. Klitzner, we help taxpayers in Florida resolve back taxes, negotiate payment plans, and prevent IRS collection actions. Call us today or fill out our contact form to discuss your situation and explore your best options for relief.