Tax Foreclosure / IRS Lien Situation

Tax Foreclosure / IRS Lien Situation

Rental Property Investor · Leucadia, CA · Member since 2015 · 153 posts · 53 votes

I have been sitting on this house for awhile, just renting it out - waiting for the IRS lien to clear out next year. Here is the situation:

1. The county foreclosed on the property as the taxes were unpaid for several years. This property is in Wisconsin. 

2. The county was in first position, but they did not name anybody in the foreclosure. 

3. They took title, I am assuming at auction and were the highest bidder (this is unclear), and then sold to me. The IRS lien was on the title report. Trust me, I know it's dumb and there is more to it. Lesson learned and this was several years ago now. 

4. It was issued 9 years ago, so we are coming up on the 10 year mark. 

I applied for a discharge and it was denied. The response was that they agreed their lien should not have survived the foreclosure, but they were never noticed - so the lien stays. The strategy I have been taking is to sit and wait and hope the IRS doesn't extend the lien. I was hoping the county would just essentially be willing to re-foreclose on the property, but it didn't seem that way.

Thoughts? Advice? Anything else.

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  • Investor · Austin TX · Member since 2016 · 1k+ posts · 2k+ votes
    7y

    @Steven Segal Why not wait until the 10 year expiration date and then transfer property into different entity (just to be safe) ? IRS must re-file and re-record their lien after 10 years. Also, they shouldnt be able to re-file since the previous owner, who actually owes the IRS money, is no longer tied to the property.

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