Federal Tax Lien
Bought a foreclosed property belonging to a trust. Both parents/settlors deceased. Daughter was successor trustee and resigned her duties at the time lis pendens was filed. Successor become brother who had Federal Lien recorded against him personally several months prior. Foreclosure was filed against deceased settlors (by name & social #). Foreclosing law firm did not put IRS on notice, their rationale; title would be unaffected.
I've scoured statutes to determine the outcome here, now that I've rehabbed and ready to market. Cannot find anything pertinent to the pickle I may be in.
Can anyone help here?
Thanks in advance. ITH
Also, he petitioned and had released to him, the excess funds which would have more than paid off the IRS. Sleezebag.....
Is the IRS lien filed on the property?
If so how long has it been?
[addsig]
The following is correspondence from the managing partner of the firm who facilitated the foreclosure. I inquired about their having not named the IRS and whether I would have to have to re-foreclose, naming the IRS in order to get clear title (or having the IRS buy me out, losing my rehab investment $)
In answer to your question,
Lien was recorded 9/2003 against the individual who ultimately became successor trustee 3/2004; 6 months prior to the foreclosure.
"The Notice of Federal Tax Lien you provided is for ******
with a SS# of *****. Our firm foreclosed on ******
with a SS# of ****. The lien does not attach to the subject
property as it is not against the property owner, therefore would not be included in the foreclosure action.
The situation is complicated by the fact that the owners are deceased and the property conveyed to a trust. The trust documents would have identified the new owner of the property and our firm would have included that person.
Unfortunately, the trust documents were not recorded and the surviving ***** did not provide them to our firm. In these instances we appoint an Attorney ad Litem to investigate. The information from that attorney did not necessitate the inclusion of the surviving Mr.****** in the action individually.
Based on the information provided, the title search and examination were accurate and the foreclosure completed properly. The lien may not attach to the property making the foreclosure of that lien unnecessary"
Thanks for asking JohnMichael. I enjoy reading your posts.
ITH
If the lien has been recorded on the subject property, it is part of the financial obligation towards the property.
If the lien has no been placed on the property, as I believe indicated on the above post than there is no obligation to clear when one takes over the property.
I would suggest taking your information and a copy of the lien document to an attorney for proper legal interruption.
[addsig]
It sounds like the brother/trustee may or may not of been a beneficiary of the trust. Since the trust declaration has remained private, I believe the lien only attached the brother/trustee and not the property. It looks like you have clear and maketable title.