Recently, there was a tax relief pronouncement made by the Internal Revenue Service. Cash strapped homeowners would be able to steer clear of a federal tax lien block refinancing of the sale of property or mortgages. This would be accomplished with the help of the Internal Revenue Service by speeding up the procedure for homeowners. If a federal tax lien is recorded when taxpayers want to refinance or sell a home, they do have choices.
A call from the taxpayer or a representative, such as a lender, to the Internal Revenue Service for a tax lien, secondary to the lien by the institution that is refinancing or reforming a loan, can be made. It is permissible for the Internal Revenue Service to receive a request from the taxpayer or a representative to release a claim if the property is for sale for less than the mortgage lien amount covered by special circumstances. Publication 784 contains the procedure to call for a release or discharge.
You can’t dispose of your property if a tax lien has been filed by the Internal Revenue Service. This applies to selling and refinancing. However, you are allowed to file a Certificate of Subordination of Federal Tax Lien. The taxpayer or representative must deliver a letter asking for subordination of the lien because there is no specific form for this purpose. All relevant documentation must be attached to the letter. It is possible that additional information may be requested. This could be in the form of appraisals and a list of your assets. It is the Technical Services Group Manager of the Internal Revenue Services who will determine the outcome of such a request from the taxpayer or the representative.
