Do you have an IRS Tax Lien on the property you are trying to sell? Is your property's market value less than your mortgage payoff? If so, you are in a short sale situation, and a federal tax lien may cause your lender to deny your sale. Why? If, for example, your home is worth $200,000, your mortgage payoff is $250,000 and your tax lien is $20,000, there would not be enough funds to pay the IRS. Your mortgage holder will not pay these taxes for you. The good news is that the IRS is trying to make it easier for homeowners to discharge the liens to sell their property.
In December, the IRS announced it would be streamling the process to discharge liens. Commissioner Doug Shulman says, "We realize these are difficult times for many Americans. We don't want the IRS to be a barrier to people saving or selling their homes". The lien discharge process takes approximately 30 days for approval. To apply for a discharge, you must follow the instructions in IRS Publication 783. Briefly, be prepared to submit:
- Deed or title and property description
- Purchase and sale agreement
- Preliminary title work showing all liens on the property
- Broker Price Opinion
- Certifed Appraisal
- Loss Mitigation Letter (approval from short sale lender)
- Your name, address and telephone number
- IRS-specified declaration that you are being truthful
There are variations of tax lien discharge scenarios, some more complex than others. You may want to consult with a tax attorney or accountant to complete the paperwork.
Wendy Rulnick, Broker, CRP, CRS, GRI, ABR Rulnick Realty, Inc.
Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204
Wendy Rulnick specializes in real estate sales, short sales, traditional sales on Emerald Coast of Florida: Destin Florida real estate, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Dune Allen, Blue Mountain Beach, Freeport, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field. Wendy Rulnick, Broker and Realtor, has been selling real estate for 20 years. She has won numerous awards, including the coveted ADDY for advertising design. Wendy lists and sells homes, condos and townhomes in Destin FL and the surrounding areas. She is ranked in the top ½ percent of all Realtors on the Emerald Coast of Florida for resale listings sold and was featured in Kiplinger Personal Finance Magazine as a short sale specialist.
All Rights Reserved. "Don't Let IRS Tax Liens Stop Your Short Sale" Contact Wendy Rulnick regarding Destin Florida real estate and vicinity.C opyright © 2009 by Wendy Rulnick.
This site, Wendy Rulnick or Rulnick Realty, Inc. is not providing legal or tax advice. The information provided is for educational and informational purposes only. It is recommended that sellers considering a short sale should consult an independent legal and tax advisor for more information.