My business has a Franchise Tax Board (FTB) lien. What effect will a lien have?
- A lien is a legal claim to secure a debt. It may delay or prevent you from certain transactions such as buying or selling property.
- Becomes public record—For a business entity, FTB will file a Notice of State Tax Lien with the California Secretary of State (Government Code Sections 7171 and 7220).
- Effective for 10 years or more—Once a lien is recorded, the lien continues in effect for 10 years, unless extended for an additional 10 years (California Government Code Section 7172(b)).
- Attaches to property—A lien attaches to any California real or personal property your business owns or have rights to.
- Impacts your credit—A lien negatively impacts your credit. It may prohibit your ability to purchase, sell, refinance, or transfer real property, along with securing loans for other assets or debts.
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