Seasonal Fluctuations in Lien Volume

It never fails, every September I get a call from a client saying “Hey, why is federal lien volume so low?” then every May I get a call “Hey we are swamped, why is federal lien volume so high?”  And every year I explain this is partially due to seasonal fluctuations in lien volume. Most consumers of federal tax lien data are aware of major lien disruptions such as the October 2013 federal shutdown or public holidays but they are less familiar with normal seasonal variations in lien volume.  Below is a chart aggregating the monthly variation of lien volume over the past 4 years.  Note that October is skewed significantly downward due to the 60% drop in lien volume during the October 2013 government shutdown.

Between 2010 and 2013, the IRS has filed an average of 16,600 federal tax liens per month.  On average they filed 15% more in May (18,900) and 18% fewer in September (13,600).  This swing in lien filings can have significant business implications when you rely on federal tax lien filings for sales leads.  Fewer leads typically means less revenue so predicting lien volume is quite helpful in estimating cash flow. So in the end, my time spent with clients discussing seasonality is well spent.  Developing models to predict lien volume turns out to be a great planning tool.  Let’s just hope there are no more government shutdowns on the horizon.