Bucci Law Offices
We provide tax representation for clients worldwide
MIAMI BEACH 305-340-2275
FORT LAUDERDALE 954-900-9107
TOLL FREE 800-743-4263

Discharge of IRS Tax Liens In Connection With A Florida Short Sale Part III

If the taxpayer applies under IRC Section 6325(b)(2)(B), there will be a determination of the amount required for a discharge or a determination that the tax lien is valueless within 30 days from the date of the application. As a caveat, the IRS notes that if an application is made under IRC Section 6325(b)(2)(B), the certificate of discharge will be issued, once the foreclosure proceeding has been concluded.

Although IRC Section 6325(b)(2)(B) may be used to apply for discharge with regard to short sales, the provision is directed mainly at foreclosures. An application for discharge under this section should explicate that a short sale in lieu of a foreclosure proceeding will not change the position of the IRS in relation to the property or the taxpayer.

The taxpayer must apply for discharge by submitting a copy of the proposed escrow agreement and completing Form 14135. It is important to remember to submit the application at least 45 days before the transaction date from which the certificate of discharge is needed. Along with the application, the taxpayer must submit a deposit or a bond in the amount of liability owed to the United States. IRC Section 6325(4)(B).

To apply under this section, the taxpayer should provide the description of the property with a copy of the deed. The application should include: when the property is to be sold, any and all liens to the property (junior and senior to the tax lien), and an itemization of all costs. In the application, the taxpayer should state whether foreclosure proceedings are expected to begin or are pending.

Finally, it is also advisable that an application include an appraisal by a disinterested third party. Although this requirement applies to taxpayers applying under a different section, the value of the property is what is at issue. IRS Publication 783 offers instruction on how to apply for a certificate of discharge from a federal tax lien.

No Comments

Leave a comment
Comment Information
Bucci Law Offices

Fort Lauderdale Office
2600 North Andrews Avenue
Fort Lauderdale, FL 33311

Toll Free: 800-743-4263
Phone: 954-900-9107
Fax: 954-764-4401
Map & Directions

Miami Beach Office
1130 Washington Avenue, 3rd Floor, Suite B
Miami Beach, FL 33139

Toll Free: 800-743-4263
Phone: 305-340-2275
Map & Directions

Email Us For A Response

Get Help With Your Tax Matter

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy