The Internal Revenue Service plans to make it easier for financially troubled homeowners to avoid federal tax liens that block them from selling their homes or refinancing their mortgages.
The IRS noted that taxpayers facing a lien from the IRS already have some options. Taxpayers or their representatives or lenders can request that the IRS make a tax lien secondary to the lien by the lending institution that is refinancing or restructuring the loan. This is known as a lien subordination. Taxpayers or their representatives can also request that the IRS discharge its claim if the home is being sold for less than the amount of the mortgage lien under certain circumstances.
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