IRS lien and death

[beegee]

My father-in-law is in critical condition in the ICU unit. He has a piece of real estate that has IRS liens attached since 1998. The property is in his name only – his wife’s name is not on the property. If he passes, will the property revert to his wife even though she is not on the deed? What action should we expect from the IRS? I am in Arkansas which I believe is a non-community property state.

Thanks

[llworking]

My father-in-law is in critical condition in the ICU unit. He has a piece of real estate that has IRS liens attached since 1998. The property is in his name only – his wife’s name is not on the property. If he passes, will the property revert to his wife even though she is not on the deed? What action should we expect from the IRS? I am in Arkansas which I believe is a non-community property state.

Thanks

Unfortunately his estate will have to sell the property to satisfy the IRS lien.

[beegee]

Will the probate process force this? Does having the wife on the deed change anything?

[seniorjudge]

I am assuming there is no will. Here is where the stuff goes:

Arkansas Intestate Succession Laws

If any part of an Arkansas decedent's estate is not effectively disposed of by will, the intestate share will first be distributed in the following order and manner:

1. To the children of the intestate and the descendants of each child of the intestate who may have predeceased the intestate, which children and descendants will take per capita or per stirpes (as explained below).
2. If the intestate is survived by no descendant, to the intestate's surviving spouse unless the intestate and such surviving spouse had been continuously married less than three years next preceding the death of the intestate, in which event the surviving spouse will take merely fifty percent of the intestate's heritable estate.
3. If the intestate is survived by no descendant or spouse, to the intestate's surviving parents, sharing equally, or to the sole surviving parent if only one of them shall be living.
4. If the intestate is survived by no descendant, but is survived by a spouse to whom the intestate has been continuously married less than three years next preceding the death of the intestate, the entire portion of his or her heritable estate which does not pass to the surviving spouse under item 2 above shall pass to the intestate's surviving parents, sharing equally, or to the sole surviving parent if only one of them shall be living.
5. If the intestate is survived by no descendant or parent, then all of his or her heritable estate which under items 3 and 4 would have vested in intestate's surviving parent or parents will pass to intestate's brothers and sisters and the descendants of any brothers and sisters of intestate who may have predeceased the intestate, such brothers, sisters, and descendants taking per capita or per stirpes (as explained below).
6. If the intestate is survived by no descendant, then in respect to such portion of his or her heritable estate as does not pass under items 2 through 5 above, the inheriting class will be the surviving grandparents, uncles, and aunts of the intestate. In this situation, each surviving grandparent shall take the same share as each surviving uncle and aunt, and no distinction shall be made between the paternal and maternal sides. In other words, a maternal grandparent, uncle, or aunt shall take the same share as a paternal grandparent, uncle, or aunt and vice versa. If any uncle or aunt of the intestate shall predecease him, the descendants of such deceased uncle or aunt will take, per capita or per stirpes (as explained below) the share the decedent would have taken if he or she had survived the intestate.
7. If the intestate is survived by no descendant, then in respect to such portion of his or her estate as does not pass under above provisions, the inheriting class will be the surviving great grandparents and great uncles and great aunts of the intestate. In this situation, each surviving great grandparent shall take the same share as each surviving great uncle and great aunt, and no distinction shall be made between the paternal and maternal sides. In other words, a maternal great grandparent, great uncle, or great aunt shall take the same share as a paternal great grandparent, great uncle, or great aunt and vice versa. If any great uncle or great aunt shall predecease the intestate, the descendants of the decedent will take, per capita or per stirpes (as explained below) the share the decedent would have taken if he or she had survived the intestate.
8. If heirs capable of inheriting the entire heritable estate cannot be found within the inheriting classes outlined above, the real and personal property of the intestate, or the portion not passing under those provisions, shall pass as follows:
* To the surviving spouse of the intestate, even though they had been married less than three years.
* If there is no such surviving spouse, to the heirs, determined as of the date of the intestate's death, of the intestate's deceased spouse (meaning the spouse to whom the intestate was last married if there had been more than one marriage). However, in case a marriage was terminated by divorce, rather than by death, the heirs of the divorced spouse shall not inherit.
* If there is no person capable of inheriting under the above two provisions, the estate shall go to the county where the decedent resided at death.

Per capita distributions. If all members of the class who inherit real or personal property from an intestate are related to the intestate in equal degree, they will inherit the intestate's estate in equal shares and will be said to take per capita. Heirs will take per capita in the following circumstances:

* If all members of the class who inherit real or personal property from an intestate are related to the intestate in equal degree, they will inherit the intestate's estate in equal shares and will be said to take per capita.
* If the members of the inheriting class are related to the intestate in unequal degree, those in the nearer degree will take per capita or in their own right; those in the more remote degree will take per stirpes or through representation.

Per stirpes distributions. Heirs will take per stirpes if the intestate is predeceased by one or more persons who would have been entitled to inherit from the intestate had such person survived him. The intestate's estate must be divided into as many equal shares as there are:

* Surviving heirs in the nearest degree of kinship to the intestate; and
* Persons in the same degree of kinship as the heirs mentioned above, who predeceased the intestate leaving descendants who survived the intestate.

Each surviving heir in the nearest degree taking per capita shall receive one share and the descendants of each predeceased person taking per stirpes shall collectively receive one share.

Arkansas Intestate Succession Law Fun Facts

* Relatives of the half blood inherit the same share they would inherit if they were of the whole blood.
* Relatives of the decedent conceived before his death, but born thereafter inherit as if they had been born in the lifetime of the decedent.
* Arkansas' intestate succession laws, as well as other laws dealing with wills and decedents' estates, can be found in Title 28 of the Arkansas Code.

Copyright 2002 - 2007, CCH Incorporated, a Wolters Kluwer business. All Rights Reserved.

http://www.finance.cch.com/pops/c50s10d190_AR.asp



The lien will remain on all property (real, personal, mixed) owned by your uncle for ten years after it was put on the property.

[beegee]

thanks for the reply - so this process will not necessarily trigger any IRS action?

Also, the lien has been on since 1998 - what will happen at the 10 year mark? What actions should the family take at that point?

[seniorjudge]

Q: thanks for the reply - so this process will not necessarily trigger any IRS action?

A: I don't know. What "process" are you talking about?



Q: Also, the lien has been on since 1998 - what will happen at the 10 year mark?

A: It may expire.



Q: What actions should the family take at that point?

A: Pay the lien.

[beegee]

sorry - the process described in the Arkansas Intestate Succession Laws

[llworking]

sorry - the process described in the Arkansas Intestate Succession Laws

I gave you the correct answer above. The IRS has a lien against the property. The estate will have to sell the property to satisfy the lien. Arkansas law is irrelevant here.

[beegee]

thanks llworking - my concern is not really satisfying the lien at this point but rather will the probate process trigger any IRS action or will the property simply go to the wife (with liens attached).

I think you are saying that the property will have to be liquidated at his passing dictated by probate but want to make sure I understand.

thanks

[llworking]

thanks llworking - my concern is not really satisfying the lien at this point but rather will the probate process trigger any IRS action or will the property simply go to the wife (with liens attached).

I think you are saying that the property will have to be liquidated at his passing dictated by probate but want to make sure I understand.

thanks

The problem is that the deed must be transferred from the husband to the wife, and that can't happen without satisfying the lien.

So yes, I am saying that the property must be liquidated, unless there is some other way to satisfy the lien.