Ii think your choices are these, you can leave it alone and continue to wash and dress it for the rest of the dogs life, you can have a biopsy done now , and given the outcome decide on an amputation or not depending on the results, or go with the amputation now while the dog is still young enough and healthy.

The lipoma could get bigger if left alone and depending where it is could give your dog more problems and become sore as well as bleeding all the time.

Only you can make the choice, you know your dog, what he can and cant put up with whether is is in good health or not so good, do you do the op now while he is relatively healthy or leave it and have to do it further down the road with more risk to his health.

Speak to your vet or get a second opinion, but ask yourself what benefit the dog will have to his life without this problem.

If it was me, I would look at it like this, if my boy was old, and I knew he only had a short time left and I felt he could cope with this for the rest of his life, then I would leave it, but if he was "oldish" and had years ahead of him he was healthy and fit I would probable have it removed to cut out any future issues.

Dogs can cope well without their tail, and yes anesthetic is a risk but I am sure your vet would not suggest it if your dog was not a candidate for it,

pros and cons, decide which benifits the dog most.