IRS Lien Timeline


#1

I am hoping that someone can help me on here since it seems to be full of great info. My husband and I are in contract for a home here in Northern CA. The seller bought the house in November at a foreclosure sale and is flipping it. We were told that escrow would not start till the IRS tax lien was removed. Last i heard the seller had paid part of it and it was getting removed. My question is how long does this process take? Is this something that will fall off after the 120 day period?


#2

I am currently in escrow on a foreclosure. When they did the preliminary title report it showed up with a $10,200 IRS tax lien. I have been told all we have to do is wait out the lien for 120 days and it will automatically expire. We are currently on day 80… Its not much fun waiting, but I feel pretty confident from what I’ve been told that the IRS tends to just let these liens run out. After all the lien is intended for the previous owners. I was tempted just to pay it…because we are so anxious for the house. I was defintely advised against it, so we are just going to wait it out…


#3

Correct, the IRS has a 120 day redemption period after their lien is wiped out by foreclosure. The IRS rarely exercises this right, so the advice you got was good. Simply wait the 120 days for the IRS’s redemption period to expire and you can close escrow the next day without issue, and without having to pay off the lien.


#4

If you were tempted to pay it and you are eager to get the house, maybe you should just call the IRS and offer them $1,000 to get rid of the lien now. On the other hand, you only have 40 days to go. :slight_smile:


#5

Thank you so much for the replies! This really helps me settle down quite a bit!


#6

At this point I guess I will try to be patient! Thanks for your input. This website has been a wealth of information on the subject. I was having a hard time getting straight detailed answers from my agent. I don’t think she has encountered an IRS lien before.


#7

Just thought I would drop a line here and let all know that there has been another successful escrow close after an IRS lien. A little patience has paid off…because now we own a beautiful home! Thanks for all the advice :slight_smile: