If I am renting a house that has just had an IRS tax lien levied against it,can the IRS seize the house without notice and take my belongings?

UPDATED: Feb 5, 2011

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If I am renting a house that has just had an IRS tax lien levied against it,can the IRS seize the house without notice and take my belongings?

I am renting a home from my daughter. The house is paid for but she owes the IRS back taxes from income, I presume. A tax lein was filed yesterday against the house. I’m afraid the one day the IRS will seize it, leaving me out on the street with nothing. Is that possible?

Asked on February 5, 2011 under Real Estate Law, Alaska


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

Income tax liens from the IRS do not work quite the same way as the security interest in a home created by a mortgage. That is, while a tax lien encumbers property and can prevent it from being sold unless the lien is satisfied--to convey clear title, the lien must be paid--it does not allow foreclosure. Instead, the lien creates the right to be paid out of any sale, refinancing, etc. of the property, and if the property is to be sold or refinanced, the lien must first be paid. So while is this certainly something your daughter should clear up--and also because it impacts her credit rating--it should result in foreclosure.

However, if you daughter is in financial difficulty, you may wish to discuss with her whether she is current on mortgage or property taxes, since the failure to pay either of those could result in foreclosure.

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