Have you ever worried that the IRS might take your house if you do not pay your taxes? This fear is common. Many people feel stressed when they cannot pay their tax bills on time. But is it true that the IRS can take your home? The short answer is yes, under certain rules. The IRS has strong powers to collect taxes you owe. However, they usually do not rush to seize your home. They have to follow strict laws first.
Facing tax debt and worried about losing your home? Our New York tax attorneys can protect your property rights and negotiate with the IRS on your behalf. Don’t risk your home—schedule a consultation today to explore payment plans and settlement options before it’s too late.
Why Can the IRS Take Your Property?
The IRS collects federal taxes for the United States. When you owe money to the IRS and do not pay it, the IRS can file a federal tax lien on all your property. This includes your house, your car, or other belongings. The law says the tax debt is attached to your property if you refuse to pay after the IRS makes a demand.
Once there is a lien, the IRS can move forward with a levy, which is a legal way to take (seize) and sell your property to pay off your tax bill. This means the IRS might even sell your house.
Does the IRS Take Houses Often?
Seizing a primary house (the home you live in most of the time) is not very common. It is a big, serious step. The IRS tries to work out easier solutions first. They might offer:
- Payment plans (called “installment agreements”).
- Offers in compromise, where you pay less than the total amount you owe.
- Other ways to get you to pay without taking your house.
The IRS must follow special rules before taking a person’s main home. In fact, a U.S. District Court Judge or Magistrate must sign off on the idea. The IRS also has to show they tried other options, like letting you make payments or settle your debt (see § 5:1.10 Tax Audits, § 1.10 Tax Audits).
Can This Happen in New York Too?
Yes. In New York, the IRS has the same powers to collect federal taxes. If you do not pay your federal taxes, the IRS can take action against you, including putting a lien on your home or seizing it. Also, New York State and local governments have their own rules about property taxes. If you do not pay property taxes to your county or city, they might also start a process to sell your home to collect back taxes (see § 45. Sale of property for unpaid taxes.).
So, you need to know about two possibilities:
- Federal taxes (owed to the IRS).
- Local property taxes (owed to your county or city in New York).
Both could lead to losing your home if you do not address the debt in time.
What Must the IRS Do Before Seizing a Home?
The IRS can’t just show up and seize your house. They have to:
- Send You a Tax Bill: This bill shows how much you owe.
- Demand Payment: They give you a date by which to pay or set up something.
- File a Notice of Federal Tax Lien: Tells the world you owe the IRS.
- Try Other Methods: They must see if they can collect in another way, like a payment plan.
- Get Court Approval: For a main home, a judge or magistrate in a U.S. District Court has to sign off.
Only then can they proceed with seizing and selling your house. This is meant to protect people from losing their homes unless it is a last resort.
Do You Have Any Protections to Keep Your Home?
Yes, there are laws to help you keep your home:
- Judge’s Approval: The IRS cannot take your main home without a judge or magistrate’s permission.
- Exhaust Other Options: The IRS must show they tried all other ways to collect first.
- Payment Arrangements: If you get a payment plan or another agreement, the IRS usually stops moving toward seizing your home.
Also, you have a right to appeal. If you think the IRS is wrong or you have a plan to pay, you can ask for a hearing. This might delay the process and give you time to fix the problem.
How Long Before a House Can Be Sold?
The process can take a while. The IRS has many steps to follow. Even when they decide to seize your home, they need to:
- Value your property.
- Allow you the chance to pay your debt or arrange a payment.
- Put your house up for sale if you do not pay.
During this time, you might find a way to redeem your property by paying off the debt. But do not wait too long, because once your house is actually sold, it is gone unless you have a legal path to undo that sale.
What About Property Taxes in New York?
For property taxes, each county in New York has rules about taking a home for unpaid taxes. They usually:
- Send notices that you have unpaid property taxes.
- Give you a deadline to pay or start a payment plan.
- If you miss that, the county can begin proceedings to sell the property.
There may be a redemption period (like in § 47-a. Payment of delinquent taxes in installments, and § 1184. Payment of delinquent taxes in installments) allowing you to catch up on taxes before the county finalizes the sale. But if you ignore the notices, you risk losing your home.
What Should You Do if You Owe Taxes in New York?
Below are simple steps to take if you owe taxes in New York:
- Open All Mail: Read any letters from the IRS or local tax office carefully.
- Call or Contact the Tax Agency: Ask for payment plans or help.
- Check Your Finances: See if you can pay in full or in part.
- Hire a New York Tax Lawyer: A lawyer can help you negotiate or set up a plan.
- Be Proactive: Waiting can lead to bigger problems, more penalties, and possibly losing your home.
If you try to solve the debt early, you have a better chance of keeping your property.
Can a New York Tax Lawyer Help You Keep Your Home?
Yes! A New York tax lawyer can help if you worry about losing your home for unpaid taxes. A lawyer can:
- Find Out What You Owe: Sometimes the amount is wrong, or you have credits you did not know about.
- Talk to the IRS for You: The IRS can be scary. A lawyer knows the language, forms, and rules.
- Set Up Payment Plans or Settlements: Many times, you can work out a monthly payment or pay less than the full bill.
- Defend Your Rights: If the IRS is moving too fast or ignoring rules, a lawyer can stand up for you.
By handling things properly, you might avoid a levy on your house.
What Happens if the IRS Sells Your House?
If the IRS does sell your house, they use the money to pay your tax debt. If there is extra money after that, it might go to other liens (like your mortgage) or eventually back to you. But the sale can be final, meaning you could lose the home. That is why it is crucial to act quickly if you get notices about liens or levies.
Ready to Protect Your Home in New York? Contact Thorgood Law Firm
Yes, the IRS can take your home for unpaid taxes, but it does not happen overnight, and there are ways to prevent it. If you are worried about a tax lien or a levy, or if you want to stop any threat to your property, call Thorgood Law Firm at 212-490-0704 today or contact us online. Let our New York tax lawyer team help you find a solution that keeps you and your home safe.
We have helped people solve tough tax problems for more than two decades, and we are ready to help you too. Don’t wait; contact us now and get peace of mind.
