Lien Withdrawal vs. Lien Release
One says the debt is settled. The other says the notice should not have been public. They are not stages of the same thing.
Quick Answer
A release ends the lien. A withdrawal removes the notice of it. They are answers to different questions, and the second is available in circumstances where the first is not — most usefully, Form 12277 lists being under a Direct Debit Installment Agreement as a ground, which means the public notice can come off while the balance is still being paid. The other grounds the form prints are: the notice was filed prematurely or not in accordance with IRS procedures; an installment agreement was entered into that did not provide for a notice to be filed; withdrawal will facilitate collection; and the taxpayer or the Taxpayer Advocate believes withdrawal is in the best interest of both the taxpayer and the government.
Release
Advantages
- It follows payment. The IRS states paying the tax debt in full is the best way to get rid of a federal tax lien, and that it releases the lien within 30 days after the debt is paid.
- It is automatic in that circumstance rather than something you apply for.
- It ends the lien.
Disadvantages
- It does not un-publish the notice. A released lien can still show as having been filed.
- It generally requires the liability to be satisfied or to have become legally unenforceable.
Best For
What it says: the lien is over, because the liability is satisfied or unenforceable.
Typical Cost
The IRS publishes no fee for either.
Withdrawal (Form 12277)
Advantages
- It removes the PUBLIC NOTICE. That is a different thing from ending the lien, and it is the thing that shows up in a credit file or a title search.
- Form 12277 prints five grounds as checkboxes, which tells you what the IRS counts as a reason.
- One of the five is "The taxpayer is under a Direct Debit Installment Agreement" — available while the debt is still owed.
- Another is "The taxpayer, or the Taxpayer Advocate acting on behalf of the taxpayer, believes withdrawal is in the best interest of the taxpayer and the government."
- A denial is appealable under the Collection Appeals Program.
Disadvantages
- It is an application, not an automatic consequence. Form 12277 has to be made out and reasoned.
- The underlying lien may still exist. The form asks separately for the current status of the lien — open, released, or unknown.
- The form is Revision 10-2011. Confirm the grounds against the current revision before relying on them.
Best For
What it says: the public notice should not stand, whatever the state of the debt.
Typical Cost
The IRS publishes no fee for either.
The Verdict
A release ends the lien. A withdrawal removes the notice of it. They are answers to different questions, and the second is available in circumstances where the first is not — most usefully, Form 12277 lists being under a Direct Debit Installment Agreement as a ground, which means the public notice can come off while the balance is still being paid. The other grounds the form prints are: the notice was filed prematurely or not in accordance with IRS procedures; an installment agreement was entered into that did not provide for a notice to be filed; withdrawal will facilitate collection; and the taxpayer or the Taxpayer Advocate believes withdrawal is in the best interest of both the taxpayer and the government.
Frequently Asked Questions
If I pay in full, is the notice removed too?
Can the notice be withdrawn while I still owe?
What does the form need?
What if the IRS refuses?
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Sources
- Form 12277, Application for Withdrawal of Filed Form 668(Y), Notice of Federal Tax Lien — Internal Revenue Service, retrieved 2026-08-21
- Understanding a federal tax lien — Internal Revenue Service, retrieved 2026-08-21
- Form 9423, Collection Appeal Request, and its instructions — Internal Revenue Service, retrieved 2026-08-21
Sourced to primary IRS materials and editorially reviewed. Not reviewed by a tax professional. Not tax advice. Report a correction.