Delinquent tax debt plagues many Americans – but now there’s some relief. Tax liens are now being removed from credit reports which will improve credit scores and providing those with poor credit a better chance to rebuild their credit score. All of the pressing details follow.

What is being removed?

Credit reporting bureaus decided to remove tax liens and civil debts. Now, reports must include all of the following in relation to the consumer:

• Name
• Address
• Social Security Number
• Birthdate

In addition, only liens that are updated at least every 90 days will be included on reports.

Why remove tax liens?

There is an industry-wide effort to improve the accuracy of credit reports. The Federal Trade Commission estimates that 26% of Americans have errors on their credit reports, which equates to 50 million reports that are inaccurate. However, the FTC estimates that very few of them have significantly damaging false information.

Although the fact of inaccurate credit reports is widely known, reporting bureaus often do not reconcile consumer complaints. The Consumer Financial Protection Bureau has received almost 200,000 notices citing the failure of reporting bureaus to investigate and remove errors. In addition, a 2012 investigation by a group of state attorney general’s found that credit reporting bureaus were not reasonably accommodating consumers’ disputes. The investigation led to a $6 million settlement and commitments to make changes to how reports are handled.

Will this affect my credit score?

Because of this update, liens have been cut in half and civil debts have decreased 96%. Just this month, they will remove 5.5 million records. These changes will affect between 6 and 11 percent of consumers, those with liens and credit scores of 620 and below. Consumers in this group have a good chance of boosting their score, and hopefully into the fair to good range. FICO estimates that 700,000 consumers will see a boost of 40 points, while 11 million consumers will see an increase of 20 points or less.

What are the consequences?

A possible consequence is that lenders will tighten guidelines in response to this reporting update. However, some argue lenders are starting to move away from traditional credit reports, such as fintech companies.

Another important repercussion: as liens lose their power, the IRS and states will likely issue more wage garnishments and levies for tax debt.

Repair Your Credit Score—Once and for All

If you’ve had liens against your credit report for some time, this update can come as a weight off of your shoulders. However, this bump in your score is just one step of the process in improving your credit worthiness. If you are still in tax debt, the best route is to avoid garnishments and levies. You can do this by setting up a payment plan and settlements with the IRS as soon as possible.