FREQUENTLY
ASKED QUESTIONS RELATED TO AN INTERNAL REVENUE SERVICE
QUESTION: How is the sale conducted?
ANSWER: The sale is an open, public auction conducted
by the Internal Revenue Service auctioneer (the Property Appraisal and
Liquidation Specialist). The auctioneer
will open the bid price at or above the minimum bid of $114,000. Generally, bidding will proceed in even
increments as determined by the auctioneer until the property is awarded to the
person bidding the highest amount.
QUESTION: If I am the successful bidder, what happens
then?
ANSWER: You must pay the auctioneer 20% of your bid
amount in the form of cash, certified check, cashier’s or treasurer’s check or
by a United States postal, bank, express, or telegraph money order made payable
to the United States Treasury. Any
balance of the amount you bid must be paid in the form of certified funds made
payable to the United States Treasury by April 19, 2013,
and mailed to Kathryn Clark, Property Appraisal and Liquidation Specialist, at
QUESTION: Is the property then owned by me to do what I
wish to do with it?
ANSWER: The taxpayer, any lien holder of interest or
any other person with a legal interest in the property has a right to redeem,
or buy back the property, within 180 days after the date of sale by the
Internal Revenue Service. If the property
is redeemed, the person redeeming the property must pay you the amount of your
bid (what you paid) for the property in addition to interest on that amount at
a rate of 20% per year.
QUESTION: During the 180-day redemption period, may I
collect rent if there are tenants? May I
improve the property? May I evict any
tenants and move onto the property myself?
Is there anything I can do with the property?
ANSWER: The taxpayer and others of interest have a
right to redeem the property and any action is dependent upon state law. Therefore, you should contact an attorney or
legal representative for this type of advice.
The Internal Revenue Service will not advise as to actions you may take
against or upon the property.
QUESTION: What happens after the 180-day redemption
period expires?
ANSWER: After the 180-day redemption period has
expired, the Internal Revenue Service will provide you a Quit Claim Deed issued
by the Area Director of the Internal Revenue Service. You must surrender the Form 2435,
“Certificate of Sale of Seized Property” which was given to you upon your full
payment of the bid price in order to receive the deed. At this time, the taxpayer and others of
interest do not have any redemption rights.
The deed discharges the Federal Tax Lien from the property and places the
title in your name giving you possession of the property.
QUESTION: Do I need to make payments to the mortgage
holder, county tax collector, etc. during the 180-day redemption period?
ANSWER: Any payment of expenses related to the
property may or may not be recoverable if the property is redeemed. This is dependent upon the state law in which
the property is located. The Internal
Revenue Service does not give advice related to this issue.
QUESTION: Will the encumbrances against the property
still remain after the Internal Revenue Service sale?
ANSWER: Any encumbrance that is recorded prior to the
Internal Revenue Service Federal Tax Lien remains upon the property and must be
dealt with by the purchaser at an Internal Revenue Service sale. The Internal Revenue Service does not pay
these expenses. Even when a property tax
becomes due and payable, the Internal Revenue Service does not pay this
obligation. The encumbrances that are
recorded after the filing of the Internal Revenue Service Federal Tax Lien and
the Federal Tax Lien are discharged from the property upon the issuance of the
deed to the property 180 days after the auction.
There
are no known encumbrances..