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3 Pitt. Tax Rev. 181 (2005-2006)
How the Fair Credit Reporting Act Fails to Protect: The Case of IRS Tax Liens on Consumer Credit Reports

handle is hein.journals/pittax3 and id is 187 raw text is: NOTE HOW THE FAIR CREDIT REPORTING ACT FAILS TO PROTECT: THE CASE OF IRS TAX LIENS ON CONSUMER CREDIT REPORTS Phillip C. Hong-Barco INTRODUCTION The Internal Revenue Service (IRS) utilizes various means to collect past due income tax balances owed by American taxpayers. A common way the IRS alerts and persuades taxpayers to satisfy their tax liability is by placing federal tax liens on the consumer's assets and bank accounts. This Note examines a problem which may result when the three major credit reporting agencies (CRAs), Equifax, Experian,' and Trans Union, list these IRS tax liens on the credit report of the consumer.2 Once a consumer has satisfied the tax liability, the IRS is not required to directly inform the CRAs and therefore, the taxpayer's credit report is not immediately updated. This can create a situation where an individual's credit report shows federal tax liens as active, though all liens have been resolved and released by the IRS. * J.D., University of Pittsburgh School of Law, 2006; B.A., Washington University in St. Louis, 2001. I wish to thank Professors James Flannery and Anthony Infanti, whose encouragement, guidance, and comments greatly enriched this Note. I also wish to thank the staff of the Pittsburgh Tax Review for its preparation of this Note for publication, particularly Michael Bauer, Diana Frank, Sandra Kozera and Jason Webb for their patient editing. All errors remain my own. 1. Experian was formerly known as TRW. A fourth credit bureau, Innovis, is in a developmental stage and does not currently function as a major credit reporting agency. 2. The circumstance that inspired this Note's issue was faced by a client the author assisted while working at the University of Pittsburgh School of Law's Low-Income Tax Clinic.

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