Tax warrant

What is a Tax Warrant?

A tax warrant is a document that the department uses to establish the debt of a taxpayer. The term Taxpayer refers to sole proprietors, partnerships, corporations, and Limited Liability Corporations.

When a tax warrant is filed with the Superior Court in the county where the taxpayer owns real or personal property, a lien is created. The lien encumbers all real and personal property used in the business and owned by the taxpayer.

What are the effects of a filed lien?

All real and personal property used in the business and owned by the taxpayer is encumbered by the state.

The tax lien becomes public record. Some local newspapers and business journals list all Superior Court filings. 

It is under this lien authority that the Department can enforce collections of the debt. Examples of enforced collections include:

• Levy of bank accounts
• Garnishment of wages
• Seizure and sale of assets or real property to retire the debt
• Revoking a taxpayer’s business registration endorsement

The tax lien will appear on a taxpayer’s credit history for 7-10 years, even after the debt is paid in full.

• Increased penalties: 10% warrant penalty on the tax due
• Increased interest: accrues daily on the unpaid tax balance
• Increased fees: $40.00 filing fees