I have a client who filed for bankruptcy over 10 years ago. The bankruptcy is no longer showing on his credit report but the state and federal tax liens are. What can be done to remove that information from the credit report?
The first question to ask is if the tax liens were included in the bankruptcy. If not, the unpaid tax liens can remain 10 years from the filing date. Therefore, the unpaid liens could remain longer than the bankruptcy.
If the tax liens were included in the bankruptcy, the lien entries should have been updated to show that was the case and that they were released. The liens would then be deleted seven years from the date they were reported in the bankruptcy.
In that instance, the liens would be deleted at the same time as the bankruptcy filing in the case of a chapter 13 bankruptcy. However, they would be deleted three years before a chapter 7 bankruptcy would be deleted from the credit history, because a chapter 7 bankruptcy filing is reported for 10 years.
Your client should get a copy of his credit report directly from Experian, not from a lender or other third party, and verify that the liens are in fact still being reported. The report will include instructions to enter a dispute indicating the tax liens were included in the bankruptcy.
During that process, your client will be given information necessary to provide documentation from the bankruptcy, such as the bankruptcy Schedule A, showing the liens were included. With that documentation, Experian will be able to delete the tax liens from the credit history.
Thanks for asking.
- The “Ask Experian” team