Expert Don Coolbaugh of Advantage Funding continues a weekly series of questions and answers for chauffeured transportation operators on all matters related to financing and leasing fleet vehicles.
QUESTION: I have a federal tax lien. What effect will that have on a decision to finance or lease my business?
ANSWER: Any state or federal tax lien that is not paid or in repayment will hurt your credit approval. The lender's fear is that the IRS will seize your bank accounts and/or property to collect on the tax lien and you will not be able to meet your financial obligations.
You should consult with a tax professional and negotiate with the taxing authority before you apply for additional credit. Without some type of resolution to your tax problem, you are wasting your time.
Source: Don Coolbaugh, vice president of sales, Advantage Funding Inc.
E-mail finance and leasing questions to: Martin@LCTmag.com