Federal Income Tax Liens
Do federal income tax liens get wiped out at a foreclosure sale? If not, can you call them and do a shortsale?
Do federal income tax liens get wiped out at a foreclosure sale? If not, can you call them and do a shortsale?
Yes, the lien is wiped out, but the IRS has 120 days to redeem the property if they chose.
Sorry, I'm new to this. How can they redeem the property if it's sold. Can I do a shortsale with them?
Yes, I agree, if the IRS does not exercise it's right of redemption in 120 days the lien falls off automatically - if you buy, DO NOT CONTACT THE IRS . Unless you have a very significant amount of equity at time of purchase the IRS is not interested in pursuing the matter. However, in the event IRS did exercise the right to redeem - remember you will only get the purchase price back and not improvements made from time of sale. They very very rarely redeem
So do I include the amount of the IRS lien in the encumberances section in the agreement to sell? The seller has a first mortgage, a 2nd lien from her business, and a 3rd and a 4th lien for equipment she bought, and the irs lien. Do we list all of these items? I already signed up the agreement but my purchase price is less that all of the liens that are on the property. Not sure what to do. Help would be much appreciated.