§6325 — Release of lien or discharge of property
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Statute Text — 26 U.S.C. §6325
Subject to such regulations as the Secretary may prescribe, the Secretary shall issue a certificate of release of any lien imposed with respect to any internal revenue tax not later than 30 days after the day on which—
The Secretary finds that the liability for the amount assessed, together with all interest in respect thereof, has been fully satisfied or has become legally unenforceable; or
There is furnished to the Secretary and accepted by him a bond that is conditioned upon the payment of the amount assessed, together with all interest in respect thereof, within the time prescribed by law (including any extension of such time), and that is in accordance with such requirements relating to terms, conditions, and form of the bond and sureties thereon, as may be specified by such regulations.
Subject to such regulations as the Secretary may prescribe, the Secretary may issue a certificate of discharge of any part of the property subject to any lien imposed under this chapter if the Secretary finds that the fair market value of that part of such property remaining subject to the lien is at least double the amount of the unsatisfied liability secured by such lien and the amount of all other liens upon such property which have priority over such lien.
Subject to such regulations as the Secretary may prescribe, the Secretary may issue a certificate of discharge of any part of the property subject to the lien if—
there is paid over to the Secretary in partial satisfaction of the liability secured by the lien an amount determined by the Secretary, which shall not be less than the value, as determined by the Secretary, of the interest of the United States in the part to be so discharged, or
the Secretary determines at any time that the interest of the United States in the part to be so discharged has no value.
In determining the value of the interest of the United States in the part to be so discharged, the Secretary shall give consideration to the value of such part and to such liens thereon as have priority over the lien of the United States.
Subject to such regulations as the Secretary may prescribe, the Secretary may issue a certificate of discharge of any part of the property subject to the lien if such part of the property is sold and, pursuant to an agreement with the Secretary, the proceeds of such sale are to be held, as a fund subject to the liens and claims of the United States, in the same manner and with the same priority as such liens and claims had with respect to the discharged property.
At the request of the owner of any property subject to any lien imposed by this chapter, the Secretary shall issue a certificate of discharge of such property if such owner—
deposits with the Secretary an amount of money equal to the value of the interest of the United States (as determined by the Secretary) in the property; or
furnishes a bond acceptable to the Secretary in a like amount.
The Secretary shall refund the amount so deposited (and shall pay interest at the overpayment rate under section 6621), and shall release such bond, to the extent that the Secretary determines that—
the unsatisfied liability giving rise to the lien can be satisfied from a source other than such property; or
the value of the interest of the United States in the property is less than the Secretary’s prior determination of such value.
If no action is filed under section 7426(a)(4) within the period prescribed therefor, the Secretary shall, within 60 days after the expiration of such period—
apply the amount deposited, or collect on such bond, to the extent necessary to satisfy the unsatisfied liability secured by the lien; and
refund (with interest as described in subparagraph (B)) any portion of the amount deposited which is not used to satisfy such liability.
Subparagraph (A) shall not apply if the owner of the property is the person whose unsatisfied liability gave rise to the lien.
Subject to such regulations as the Secretary may prescribe, the Secretary may issue a certificate of discharge of any or all of the property subject to any lien imposed by section 6324 if the Secretary finds that the liability secured by such lien has been fully satisfied or provided for.
Subject to such regulations as the Secretary may prescribe, the Secretary may issue a certificate of subordination of any lien imposed by this chapter upon any part of the property subject to such lien if—
there is paid over to the Secretary an amount equal to the amount of the lien or interest to which the certificate subordinates the lien of the United States,
the Secretary believes that the amount realizable by the United States from the property to which the certificate relates, or from any other property subject to the lien, will ultimately be increased by reason of the issuance of such certificate and that the ultimate collection of the tax liability will be facilitated by such subordination, or
in the case of any lien imposed by section 6324B, if the Secretary determines that the United States will be adequately secured after such subordination.
If the Secretary determines that, because of confusion of names or otherwise, any person (other than the person against whom the tax was assessed) is or may be injured by the appearance that a notice of lien filed under section 6323 refers to such person, the Secretary may issue a certificate that the lien does not attach to the property of such person.
Except as provided in paragraphs (2) and (3), if a certificate is issued pursuant to this section by the Secretary and is filed in the same office as the notice of lien to which it relates (if such notice of lien has been filed) such certificate shall have the following effect:
in the case of a certificate of release, such certificate shall be conclusive that the lien referred to in such certificate is extinguished;
in the case of a certificate of discharge, such certificate shall be conclusive that the property covered by such certificate is discharged from the lien;
in the case of a certificate of subordination, such certificate shall be conclusive that the lien or interest to which the lien of the United States is subordinated is superior to the lien of the United States; and
in the case of a certificate of nonattachment, such certificate shall be conclusive that the lien of the United States does not attach to the property of the person referred to in such certificate.
If the Secretary determines that a certificate of release or nonattachment of a lien imposed by section 6321 was issued erroneously or improvidently, or if a certificate of release of such lien was issued pursuant to a collateral agreement entered into in connection with a compromise under section 7122 which has been breached, and if the period of limitation on collection after assessment has not expired, the Secretary may revoke such certificate and reinstate the lien—
by mailing notice of such revocation to the person against whom the tax was assessed at his last known address, and
by filing notice of such revocation in the same office in which the notice of lien to which it relates was filed (if such notice of lien had been filed).
Such reinstated lien (i) shall be effective on the date notice of revocation is mailed to the taxpayer in accordance with the provisions of subparagraph (A), but not earlier than the date on which any required filing of notice of revocation is filed in accordance with the provisions of subparagraph (B), and (ii) shall have the same force and effect (as of such date), until the expiration of the period of limitation on collection after assessment, as a lien imposed by section 6321 (relating to lien for taxes).
Notwithstanding any other provision of this subtitle, any lien imposed by this chapter shall attach to any property with respect to which a certificate of discharge has been issued if the person liable for the tax reacquires such property after such certificate has been issued.
If a certificate or notice issued pursuant to this section may not be filed in the office designated by State law in which the notice of lien imposed by section 6321 is filed, such certificate or notice shall be effective if filed in the office of the clerk of the United States district court for the judicial district in which such office is situated.
For provisions relating to bonds, see chapter 73 (sec. 7101 and following).
Treasury Regulations
- Treas. Reg. §Treas. Reg. §20.6325-1 Release of lien or partial discharge of property; transfer certificates in nonresident estates
- Treas. Reg. §Treas. Reg. §20.6325-1(a) A transfer certificate is a certificate permitting the transfer of property of a nonresident decedent without liability.
- Treas. Reg. §Treas. Reg. §20.6325-1(b) §20.6325-1(b)
- Treas. Reg. §Treas. Reg. §20.6325-1(c) A transfer certificate will be issued by the service center director or the district director when he is satisfied that the tax imposed upon the estate, if any, has been fully discharged or provided for.
- Treas. Reg. §Treas. Reg. §20.6325-1(i) In the case of a nonresident not a citizen of the United States dying on or after January 1, 1977, a transfer certificate is not required with respect to the transfer of any property of the decedent if the value on the date of death of that part of the decedent's gross estate situated in the United States did not exceed the lesser of $60,000 or $60,000 reduced by the adjustments, if any, required by section 6018(a)(4) for certain taxable gifts made by the decedent and for the aggregate amount of
- Treas. Reg. §Treas. Reg. §301.6325-1 Release of lien or discharge of property
- Treas. Reg. §Treas. Reg. §301.6325-1(a) Mailing notice of the revocation to the taxpayer at his last known address (see § 301.
- Treas. Reg. §Treas. Reg. §301.6325-1(b) Treatment of reinstated lien.
- Treas. Reg. §Treas. Reg. §301.6325-1(c) Estate or gift tax liability fully satisfied or provided for—(1) Certificate of discharge.
- Treas. Reg. §Treas. Reg. §301.6325-1(d) Subordination of lien—(1) By payment of the amount subordinated.
- Treas. Reg. §Treas. Reg. §301.6325-1(e) Nonattachment of lien.
- Treas. Reg. §Treas. Reg. §301.6325-1(f) Effect of certificate—(1) Conclusiveness.
- Treas. Reg. §Treas. Reg. §301.6325-1(g) Filing of certificates and notices.
- Treas. Reg. §Treas. Reg. §301.6325-1(h) As used in this section, the term appropriate official means either the official or office identified in the relevant IRS Publication or, if such official or office is not so identified, the Secretary or his delegate.
- Treas. Reg. §Treas. Reg. §301.6325-1(i) Effective/applicability date.
19 Citing Cases
Section 301 .6325-1(a), Proced . & Admin . Regs ., provides that a lien shall be released when the entire liability has been satisfied and the lien has become legally unenforceable . Section 6325 does not apply because petitioner's liability has not been fully satisfied .
to sections 6323(j), to release a lien pursuant to section 6325, and .to release a levy pursuant to section 6343 .
Petitioner remains liable for his underlying liability even though respondent released th e NFTLs filed pursuant to section 6325 .
The Court will grant respondent’s motion for summary judgment, except with respect to 1992 and 1995, for which petitioners satisfied their liabilities in full, and which we assume respondent will issue a certificate of release pursuant to section 6325.
Respondent argues that neither section 6325 nor the caselaw provides that the filing of a certificate of release of lien extinguishes the underlying liability.
nference call between the parties and the Court to discuss the pending Motions, the Court invited the parties to express their 8 The Beltons also sought civil damages under section 7432 based on an alleged failure by the IRS to release a lien under section 6325. The Commissioner resisted the request, noting that “the Tax Court has no jurisdiction to order such damages under section 7432, which authorizes a taxpayer to ‘bring a civil action for damages against the United States in a district cour
He also explained that (1) no information was provided which met the criteria for lien withdrawal under section 6323(j) or discharge under section 6325; (2) collection met all the procedures for filing the lien; and (3) he would recommend sustaining the collection action.
cluding without limitation, the right to relief under IRC §6015 (innocent spouse), §6159 (installment agreement), §7122 (offer in compromise), §6343 (release of levy), §7811 (taxpayer assistance order), §6502 (statute of limitations on collection), §6325 (release of lien), collection due process, collection appeals program, currently non-collectible status, bankruptcy, and any other current or future law that may serve to reduce the amount 1 Unless otherwise indicated, all statutory references a
However, the filing by which this ostensible release was made states: With respect to each assessment below, unless notice oflien is refiled by the date in column(e) [i.e., dates in 2021 and 2022], this notice shall constitute the certificate ofrelease oflien as defined in IRC 6325(a).
- 8 - pendency ,of petitioner's refund suit in District Court. But he does not allege, =and;the record does not suggest, that respondent has proposed or commenced any such collection-action, apart from filing the NFTL. Hence any future collection action is purelyt speculative and not, a.proper object of relief in this proceeding a to re
If respondent's tax lien inhibited petitioners from refinancing or selling their residence , petitioners could have requested respondent to subordinate the tax lien under section 6325 (d) to facilitate the refinancing or sale .
6331(k), relating to levies. Petitioner has not shown - 7 - entitlement to a release as a matter of law or right, and, accordingly, petitioner has not shown an abuse of discretion. We also note that petitioner and his representative were offered proof that respondent had complied with the prerequisites of sections 6320 and 6330