i owe the irs 10K, i'm currently trying to purchase a home- once i purchase the home will the irs put a lien

Question

on the house? and how will it affect my offer in compromise that i am trying to negotiate? if my put my offer in before i get the house i do i amend my offer or do i ammend the offer to reflect the purchase of the house? and how will it affect my overall payments to the irs?

Answer 1

I think your best bet is to just get an installment agreement. As long as you have an installment agreement in good standing (i.e., you make the monthly payments), the IRS won't put a lien on your house.

Second, it seems very unlikely that you'll get an offer in compromise accepted for a $10,000 tax debt, especially if you can afford a house. The first thing the IRS looks at is whether or not you can pay the tax debt with an installment agreement during the time allowed by law (which is 10 years). If you can, then they automatically reject your offer.

So, how old is this tax debt? One year? Two years? Whatever it is, subtract that from 10 years, and that's how much time the IRS has to collect the taxes. Thus, if your tax debt is 3 years old, let's say, and you can pay $200 a month, then you can easily pay it off in the time allowed, and the IRS won't accept your offer in compromise.

Last, but not least, as already stated here, the IRS will look at your assets when considering your offer. If you have cash to put a deposit down on a house, that would have to be applied to your offer, along with any amounts that can be borrowed on your assets or money that could be gotten from the sale of the assets. That's in addition to any amounts you have left over after necessary expenses each month, multiplied by 48 or 60 (depending upon which type of offer you did).

Thus, you probably wouldn't save any money with an offer anyway, even if you could get one accepted, which you probably wouldn't be able to do.

But, to answer your question, when you file your offer in compromise, you also file a 433-A, which lists your income, expenses, and assets. If any of that information changes after you file your 433-A (such as if you buy a house), you can always submit an ammended 433-A.

Answer 2

If you have a significant debt with the IRS and are attempting an Offer in Compromise you should follow through with that prior to making any other major financial committments. When the IRS discoveres that you had sufficient resources to purchase a home they are going to take a VERY dim vue of your attempt to settle for less than you owe them.

Before an Offer in Compromise is accepted, the IRS will want a detailed look at your entire financial picture. Given that the purchase of even a relatively modest home today will involve down payment and closing costs of $10k or more they're not going to accept less than your entire debt unless you are contesting the validity of the alleged assessment in the first place.

And yes, the IRS can put a tax lien on your new home.

Answer 3

Before buying, pay the $10,000. This will make it easier to get a mortgage. As it stands, a mortgage company is going to avoid you. If, for no other reason, than THEIR interest is subject to a lien. If you already have a mortgage lender, they can still decide to cancel. And, if not, they can come after you in a lien is put on the house.

Yes, the IRS can put a lien on a house you buy.

Pay the $10K first.

Answer 4

If you're $10k in the red, you CAN'T afford a house ! Hello ! I think you should wait on the house idea until you're in the black. I've worked in a IRS mailroom, and they don't joke when it comes to money. They pay people $10 an hour just to make sure envelopes are not post maked late. No kidding ! But they will allow you to make monthly payments. Can you really afford house payments and payments to the IRS too ? I doubt it...

Answer 5

Could happen, the lien. And I don't suppose it would help your position re the offer of compromise to claim you can't pay what you owe, but had the money to purchase a home.