Quiet title against IRS Tax Lien

[Will Sifert]

In Louisiana, after the redemptive period has expired, we file a suit to confirm the tax sale and quiet title. Once it is all said and done we receive a judgement, which is equivalent to a deed for other states. Everyone named in the suit loses their ownership interest in the property.

I have done this 20+ times but this is the first time the previous owner had an IRS tax lien recorded against them. I was going to have the IRS named in the suit and have them notified through certified mail.

Has anyone else been in a situation like this?

I am assuming they will sign for the certified mail, someone at a front desk etc. If they do not respond I assume I would receive a judgement against them like all other parties with an ownership interest. I am not aware of any law or anything that prevents you from including the IRS in a lawsuit.

The way it works in Louisiana, they would have 6 months to file a suit to annual the tax sale. In which case they would have to pay me back all of the back taxes and interest. All they would accomplish by doing this would be to prevent the original owner from losing the property so they could still have their lien enforced against it. I seriously doubt they would chose to go that route.

The IRS lien was recorded against the owner of the property in 2016.  I could also wait 3 more years for the lien to prescribe, assuming its not reinscribed. 

I just want to make sure I am not missing anything and if anyone else has gone through a similar situation. I know when you are buying property that has an IRS Tax lien against it, the proceeds of the sale goes to the IRS. But this is different with tax liens as the property isn't being purchased from  the original owner. 

[Chris Seveney]

Quote from @Will Sifert:

In Louisiana, after the redemptive period has expired, we file a suit to confirm the tax sale and quiet title. Once it is all said and done we receive a judgement, which is equivalent to a deed for other states. Everyone named in the suit loses their ownership interest in the property.

I have done this 20+ times but this is the first time the previous owner had an IRS tax lien recorded against them. I was going to have the IRS named in the suit and have them notified through certified mail.

Has anyone else been in a situation like this?

I am assuming they will sign for the certified mail, someone at a front desk etc. If they do not respond I assume I would receive a judgement against them like all other parties with an ownership interest. I am not aware of any law or anything that prevents you from including the IRS in a lawsuit.

The way it works in Louisiana, they would have 6 months to file a suit to annual the tax sale. In which case they would have to pay me back all of the back taxes and interest. All they would accomplish by doing this would be to prevent the original owner from losing the property so they could still have their lien enforced against it. I seriously doubt they would chose to go that route.

The IRS lien was recorded against the owner of the property in 2016.  I could also wait 3 more years for the lien to prescribe, assuming its not reinscribed. 

I just want to make sure I am not missing anything and if anyone else has gone through a similar situation. I know when you are buying property that has an IRS Tax lien against it, the proceeds of the sale goes to the IRS. But this is different with tax liens as the property isn't being purchased from  the original owner. 

 I have had an IRS tax lien removed from a property. you need to complete a Form 14135. I absolutely recommend engaging an attorney to do this as the form requires a lot of information. One of them will be an appraisal typically as well. It will cost you a few grand to get it done.Surprisingly enough, the IRS responded in a fairly quick timeframe (I want to say 45 days) when we did ours.