Source: http://oicattorney.blogspot.com/2008/02/irs-lien-release-new-rebulations.html
Timestamp: 2017-10-22 06:19:03
Document Index: 673118066

Matched Legal Cases: ['art 301', '§301', '§301', 'arts 301', '§301', '§301', '§301', '§301', '§301', '§301', 'ART 401', 'art 401']

IRS Lien Release - New Rebulations- Section 6325T.D. 9378, Correction
Code Sec. 6325
Practice and procedure : Tax liens : Release of encumbrance .
[TD 9378 ]
RIN 1545-BE35
SUMMARY: This document contains corrections to final regulations (TD 9378 ) that were published in the Federal Register on Thursday, January 31, 2008 (73 FR 5741) relating to release of lien and discharge of property under sections 6325 , 6503 and 7423 of the Internal Revenue Code. These regulations update existing regulations and contain procedures for processing a request made by a property owner for discharge of a Federal tax lien from his property under section 6325(b)(4) . The regulations also clarify the impact of these procedures on sections 6503(f)(2) and 7426(a)(4) and (b)(5).
DATES: The correction is effective February 22, 2008.
FOR FURTHER INFORMATION CONTACT: Debra A. Kohn, (202) 622-7985 (not a toll-free number).
The final regulations (TD 9378 ) that are the subject of the correction are under sections 6325 , 6503 and 7426 of the Internal Revenue Code.
As published, final regulations (TD 9378 ) contain errors that may prove to be misleading and are in need of clarification.
Accordingly, 26 CFR part 301 is corrected by making the following amendments:
Par. 2 Section 301.6325-1 is amended by revising the second sentence of paragraph (b)(2)(i) and first sentence of paragraph (b)(4)(ii) to read as follows:
§301.6025-1 Release of lien or discharge of property.
T.D. 9378 , filed with the Federal Register on January 31, 2008 (corrected 2/21/2008).
[ Code Secs. 6325, 6503 and 7426]
Practice and procedure: Tax liens: Release of encumbrance. --
Amendments of Reg. §§301.6325-1, 301.6503(f)-1 and 301.7426-1, related to release of lien and discharge of property under Code Secs. 6325, 6503 and 7426, are adopted. Back references: ¶38,166, ¶39,036 and ¶41,712.
SUMMARY: This document contains final regulations related to release of lien and discharge of property under sections 6325, 6503, and 7426 of the Internal Revenue Code (Code). These regulations update existing regulations and contain procedures for processing a request made by a property owner for discharge of a Federal tax lien from his property under section 6325(b)(4). The regulations also clarify the impact of these procedures on sections 6503(f)(2) and 7426(a)(4) and (b)(5). These regulations reflect the enactment of sections 6325(b)(4), 6503(f)(2), and 7426(a)(4) by the IRS Restructuring and Reform Act of 1998.
DATES: Effective Date: These regulations are effective January 31, 2008.
The final regulations differ substantively in one respect from the version of the regulations set forth in the notice of proposed rulemaking. The proposed regulations interpret section 6325(b)(4)(D), which states that section 6325(b)(4)(A) is inapplicable "if the owner of the property is the person whose unsatisfied liability gave rise to the lien," as indicating that the procedures for obtaining a discharge of a Federal tax lien under section 6325(b)(4) are not available to a person who owns the subject property with the person whose tax liability gave rise to the lien (the taxpayer). Upon further consideration of this issue, it was decided that section 6235(b)(4)(D) should not be so interpreted, as that interpretation would unfairly leave some third-party property owners without a means to discharge Federal tax liens from their properties. Accordingly, the final regulations reflect an interpretation of section 6325(b)(4)(D) that makes the section 6325(b)(4) procedures available to a person who co-owns property with the taxpayer.
Accordingly, under the authority of 26 U.S.C. 7805, 26 CFR parts 301 and 401 are amended as follows:
5. Paragraphs (c)(1) and (c)(2) are amended by removing the language "district director" and adding the language "appropriate official" in its place, wherever it appears.
6. The first sentence of paragraph (d)(1) is amended by removing the language "A district director" and adding the language "The appropriate official" in its place, by removing the word "Code" and adding the language "Internal Revenue Code" in its place, and by removing the language "the district director" and adding the language "the appropriate official" in its place. The third sentence is amended by removing the language "a district director" and adding the language "the appropriate official" in its place, and removing the language "the district director" and adding "the appropriate official" in its place.
7. Paragraph (d)(2)(i) is amended by removing the language "A district director" and adding the language "The appropriate official" in its place, by removing the word "Code" and adding the language "Internal Revenue Code" in its place, and by removing the language "the district director" and adding the language "the appropriate official" in its place.
8. Paragraph (d)(2)(ii), Examples 1 through 4, are amended by removing the language "district director" and adding the language "appropriate official" in its place, wherever it appears.
9. Paragraphs (d)(3) and (d)(4) are amended by removing the language "district director" and adding the language "appropriate official" in its place, wherever it appears.
10. The first sentence of paragraph (e) is amended by removing the language "a district director" and adding the language "the appropriate official" in its place, and by removing the language "the district director" and adding the language "the appropriate official" in its place. The third and fourth sentences are amended by removing the language "district director" and adding the language "appropriate official" in its place.
11. Paragraphs (f)(1) and (f)(2)(i) are amended by removing the language "a district director" and adding the language "the appropriate official" in its place, paragraph (f)(2)(i)(b) is amended by removing the language "the district director" and adding the language "the appropriate official" in its place, and paragraph (f)(3) is amended by removing the word "Code" and adding the language "Internal Revenue Code" in its place.
§301.6325-1 Release of lien or discharge of property.
(a) Release of lien --(1) Liability satisfied or unenforceable. The appropriate official shall issue a certificate of release for a filed notice of Federal tax lien, no later than 30 days after the date on which he finds that the entire tax liability listed in such notice of Federal tax lien either has been fully satisfied (as defined in paragraph (a)(4) of this section) or has become legally unenforceable. In all cases, the liability for the payment of the tax continues until satisfaction of the tax in full or until the expiration of the statutory period for collection, including such extension of the period for collection as is agreed to.
(2) Bond accepted. The appropriate official shall issue a certificate of release of any tax lien if he is furnished and accepts a bond that is conditioned upon the payment of the amount assessed (together with all interest in respect thereof), within the time agreed upon in the bond, but not later than 6 months before the expiration of the statutory period for collection, including any agreed upon extensions. For provisions relating to bonds, see sections 7101 and 7102 and §§301.7101-1 and 301.7102-1.
(4) Satisfaction of tax liability. For purposes of paragraph (a)(1) of this section, satisfaction of the tax liability occurs when --
(5) Proof of full payment. As used in paragraph (a)(4)(ii) of this section, the term proof of full payment means --
(b) Discharge of specific property from the lien --(1) Property double the amount of the liability. (i) The appropriate official may, in his discretion, issue a certificate of discharge of any part of the property subject to a Federal tax lien imposed under chapter 64 of the Internal Revenue Code if he determines that the fair market value of that part of the property remaining subject to the Federal tax lien is at least double the sum of the amount of the unsatisfied liability secured by the Federal tax lien and of the amount of all other liens upon the property which have priority over the Federal tax lien. In general, fair market value is that amount which one ready and willing but not compelled to buy would pay to another ready and willing but not compelled to sell the property.
(2) Part payment; interest of United States valueless --(i) Part payment. The appropriate official may, in his discretion, issue a certificate of discharge of any part of the property subject to a Federal tax lien imposed under chapter 64 of the Internal Revenue Code if there is paid over to him in partial satisfaction of the liability secured by the Federal tax lien an amount determined by him to be not less than the value of the interest of the United States in the property to be so discharged. In determining the amount to be paid, the appropriate official will take into consideration all the facts and circumstances of the case, including the expenses to which the government has been put in the matter. In no case shall the amount to be paid be less than the value of the interest of the United States in the property with respect to which the certificate of discharge is to be issued.
(4) Right of substitution of value --(i) Issuance of certificate of discharge to property owner who is not the taxpayer. If an owner of property subject to a Federal tax lien imposed under chapter 64 of the Internal Revenue Code submits an application for a certificate of discharge pursuant to paragraph (b)(5) of this section, the appropriate official shall issue a certificate of discharge of such property after the owner either deposits with the appropriate official an amount equal to the value of the interest of the United States in the property, as determined by the appropriate official pursuant to paragraph (b)(6) of this section, or furnishes an acceptable bond in a like amount. This paragraph does not apply if the person seeking the discharge is the person whose unsatisfied liability gave rise to the Federal tax lien. Thus, if the property is owned by both the taxpayer and another person, the other person may obtain a certificate of discharge of the property under this paragraph, but the taxpayer may not.
2. The undesignated paragraph is designated as paragraph (a), a paragraph heading is added, and a new sentence is added immediately prior to the Example.
3. In newly designated paragraph (a), the language "a district director" is removed and the language "the appropriate official" is added in its place, the language "the district director" is removed and the language "the appropriate official" is added in its place, and in the Example the language "district director" is removed and the language "appropriate official" is added in its place, wherever it appears.
§301.6503(f)-1 Suspension of running of period of limitation; wrongful seizure of property of third-party owner and discharge of lien for substitution of value.
(b) Discharge of wrongful lien for substitution of value. If a person other than the taxpayer submits a request in writing for a certificate of discharge for a filed Federal tax lien under section 6325(b)(4), the running of the period of limitations on collection after assessment under section 6502 for any liability listed in such notice of Federal tax lien shall be suspended for a period equal to the period beginning on the date the appropriate official receives a deposit or bond in the amount specified in §301.6325-1(b)(4)(i) and ending on the date that is 30 days after the earlier of --
Par. 4. In §301.7426-1, paragraphs (a)(4), (b)(5), and (d) are added.
§301.7426-1 Civil actions by persons other than taxpayers.
PART 401 --[REMOVED]
Par. 5. Part 401 is removed.
Posted by www.irstaxattorney.com at 3:35 AM
Labels: IRS Lien Release - New Regulations