Nov 09
08
How often does the IRS redeem tax liens on foreclosed property?
Posted by taxliensI’m an experienced foreclosure investor, and generally know the risks of buying foreclosed properties at auction. However, there is a property I’d like to purchase that has a substantial tax lien attached to it, and I’m not sure how much I should take that into consideration. Exactly how often does the IRS exercise its redemption rights in foreclosed properties? Are there any particular factors that make the IRS more inclined to redeem a particular property?
When an institution or a property owner has to foreclose on a property the IRS law requires that they be notified so that they can ascertain if they have the right to place a lien on that property before it gets foreclosed, hardly anybody knows that or does that. If a property is foreclosed and then the IRS determines that they have a lien, there is all kinds of complications.
In any event when there is a lien on a property the lien gets paid at closing of the sale of the property.