What to do if there is a tax lien ona beneficiary of an estate?

UPDATED: Aug 20, 2011

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

UPDATED: Aug 20, 2011Fact Checked

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

What to do if there is a tax lien ona beneficiary of an estate?

I am the executor of an estate and it has been brought to my attention that one member of the estate has a tax lien on them. The lien has been filed in the same state that a piece of real estate that is to be liquidated is located in. Will this effect the sale of the house, closing? Do I simply distribute the proceeds directly or will I be directed to send the funds to the IRS?

Asked on August 20, 2011 New York


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

If the tax obligation of one of the beneficiaries of the estate has not resulted in an actual lien filed on the probate proceeding as to that person's inheritance, you have no obligation to send any proceeds to the IRS.

The IRS claim will have no effect upon the sale of any asset of the estate that your are the executor on. The IRS claim will only become an issue for you and the beneficiary if the beneficiary's share of the estate is physically liened.

In the interim, you should consult with the attorney assisting in the probate as well as discuss with the beneficiary who owes the IRS money about how he or she wants to handle disntribution of the estate. Meaning, will the beneficiary voluntarily agree to have the estate send a portion of his or her share of the estate to the IRS or not?

Good question.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption