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Text of Federal Tax Lien Relief Press Briefing December 16, 2008

Federal Tax Lien Relief Press Briefing Opening Remarks - IRS Commissioner Douglas Shulman

Good afternoon, everybody. Thanks so much for spending the time with us today. These are clearly difficult times for the U.S. economy.  Many homeowners are at risk of losing their homes.  Many are hoping to refinance at lower rates, and in some cases, homeowners are forced to sell their homes and get the best deal they can in the current marketplace.  This is a particularly important time for government leaders to be mindful of the various challenges we face together as a nation. 

At the IRS, we need to ensure that we balance our responsibility to enforce the law with the economic realities facing many American citizens today.  In a small but potentially important way for some families, the IRS is trying very hard to help.  Today, I'm announcing an expedited process that will make it easier for financially distressed homeowners to avoid having a federal tax lien block refinancing of mortgages or the sale of a home.  For taxpayers who are trying to refinance their mortgage, the existence of a tax lien generally means that the new lender will not go through with the refinancing.  But in a lot of cases, the IRS will decide to make the federal tax lien secondary to another lien, such as a new mortgage. 

The IRS is ready to help taxpayers who find themselves in these situations.  Where we can subordinate our lien to help a family win that new refinance mortgage, that may mean that they can stay in their homes.  Some taxpayers are also trying to sell their homes.  Often, they have no equity in the home because it has gone down in value.  Again, the tax lien makes it unlikely that a new buyer could get a mortgage on the property.  In these cases, we can discharge the tax lien so that the sale can proceed. 

I want to stress the IRS is doing whatever it can under the constraints of the law and common sense to avoid getting in the way of people trying to save their homes or sell their homes.  It currently takes about thirty days to apply for and receive either a discharge or a subordination of a federal tax lien.  The IRS is committed to putting in place whatever resources are needed to speed this process up as much as possible, so that we will not be the party delaying a closing or a settlement.  So, the question is, will this help a lot of families?  I'm not in a position to predict how many families this will affect or how many families will take advantage of these new, expedited IRS procedures, but I can say that there are more than a million federal tax liens outstanding today, tied to both real and personal property.

Let me just give you a little more how it works.  Then I'll be happy to take some questions.  And then Fred Schindler, our technical expert, will take you through as many questions as you have.  A taxpayer or their representative, such as their lender, may request that the IRS make a tax lien secondary to the lien by a lending institution that is refinancing or restructuring a loan.  A taxpayer may also request that the IRS discharge its claim if the home is being sold for less than the amount of the mortgage lien in some cases. 

Taxpayers can find all the information they need at www.irs.gov.  You know, I think the main message and what we want to let people know is that, as commissioner, I've given instructions to all IRS personnel to work with taxpayers on any mortgage-related issue.  We've shifted resources to expedite our subordination process.  We're gonna go the extra mile 'cause we're very sensitive that this is an important issue the taxpayers are gonna be working through in these difficult economic times.

Audio File: Federal Tax Lien Relief - IRS Commissioner Douglas Shulman - 12/16/08, 4 minutes and 31 seconds long.  The audio file will open in Windows Player, and you will be able to pause, fast forward, rewind, mute, and control the volume from the interactive player.
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Page Last Reviewed or Updated: 26-Mar-2014