Unpaid Taxes

Sometimes, people get behind on paying their taxes. Once the amount reaches a certain threshold, the taxation entity (e.g. the Internal Revenue Service) establishes a lien on property held by the person. Although handling a tax lien can be complicated, it is often still possible to sell the home as a way to reduce or eliminate the amount of the tax debt.

 In all U.S. jurisdictions a lender who conducts a foreclosure sale of real property which is the subject of a federal tax lien must give 25 days’ notice of the sale to the Internal Revenue Service: failure to give notice to the IRS results in the lien remaining attached to the real property after the sale. Therefore, it is imperative the lender search local federal tax liens so if parties involved in the foreclosure have a federal tax lien filed against them, the proper notice to the IRS is given. A detailed explanation by the IRS of the federal tax lien process can be found