Federal Liens
Does anyone know if a federal lein can be taken off a property , I just bid on a forclosure and put $40,000 down, now found out there is a $41,000 federal tax lien, one lawyer says the title comp. will take it off and insure it for us. Does this seem right ??? 
Federal tax liens are the mothership of all leins. They are not released title unless the debt is satisfied. Was this property sold at a tax auction? A title company will not remove lein without evidence it has been released. What is the properties value compared to the debt ratio? If it is worth more than $81K then wholesale your troubles away...
If it is worth significantly more than $81K than fix it and sell your troubles away. Contact a good real estate attny and ask lots of questions......
Please answer the questions above for further clarification. IF you bid on the property and the property is owned by a bank, then the bank would pay all the liens to give you clear title.
A very important question is with the added lien(s), would you still be able to make a decent profit? If so, the property might still be worth it.
Good luck
the IRS has 120 days to redeem the property that you just bought at auction, and this is on the assumption that their federal tax lien was junior to the mortgage that just foreclosed on which is probably the case. The practical significance of this right of redemption is not nearly as onerous as it sounds for several reasons. First and foremost, it is unlikely that the IRS will exercise its right of redemption unless the successful bid is substantially less than the fair market value of the property. Similar to the position of most any lender facing foreclosure, the Internal Revenue Service would prefer to receive partial payment rather than deal with the hassles and expenses of owning property that it may not be able to sell in order to recoup its investment. And, the IRS will likely not disrupt a foreclosure by exercising its right of redemption where the "equity" available to apply to the tax lien is marginal. Accordingly, the purchaser can frequently obtain a waiver from the Internal Revenue Service of its right of redemption. (not recommended.leave the sleeping giant alone...)
In the event the IRS does not waive its right of redemption, the 120 days begins to run on the day after the 10 day upset period expires. If the IRS exercises its right of redemption during the 120 day period, it is required to pay the purchaser of the foreclosed property the sum of :
(1) the actual amount paid by the purchaser at such sale (which, in the case of a purchaser who is the holder of the lien being foreclosed, shall include the amount of the obligation secured by such lien to the extent satisfied by reason of such sale), (2) interest on the amount paid (as determined under paragraph (1) ) at 6 percent per annum from the date of such sale, and (3) the amount (if any) equal to the excess of (A) the expenses necessarily incurred in connection with such property, over (B) the income from such property plus (to the extent such property is used by the purchaser) a reasonable rental value of such property. 28 U.S.C.A. ' 2410(d).
p.s. they will not reimburse for any repairs that you may do to the property...so wait for the 120 days to expire.