The IRS Audit Blog

Posts Tagged ‘irs closing letter estate’

Question: Can the IRS Levy A closed estate?

My wife was the exec of her mothers estate, She owned a home worth 80k she owed 65k on the home the other siblings signed letters giving up their right to any profit from the home. The said home was then purchased by my wife and I. The estate went threw probate and has been closed for close to 2 years.

The Estate received a letter from the IRS stating this is not a tax bill but a levy has been imposed because her sister apparently did not pay her income tax for a few years. Now there was no issues with the estate owing taxes ETC. Just curious what they think they can levy. Since there are no assests remaining from the estate.

Answer: Respond that there is nothing due to your wife’s tax-delinquent sister from the estate.

Tri-State Housing Market In Better Shape Than Rest of Country

The local real estate market is in better condition than the rest of the country.

Question: IRS Tax Disclosure form for Stated Income No Doc Loan?

I’m in escrow on a stated income product. I have given my monthly income, and documented my self employment with an “accountants letter” for 2-years per the Loan Officer’s request. Now I’m getting ready to sign Loan Docs in the escrow office. The escrow officer at my request described the forms we would be asked to sign, one of which is an “IRS FORM” that gives the Lender permission to check my income per tax returns for prior years. Due to all my deductions the income will not appear identical. Can they deny funding my loan based on what the IRS gives them? I thought this was supposed to be a “no doc” loan, but now I’m surprised w/this form and escrow is due to close any day now. Will this be a problem for me?

Answer: I think the form you’re being asked to sign is one that gives a bank auditor permission to pull your tax returns if the lender gets audited. It’s usually to show that the tax returns used to secure the loan were really what the IRS had also. Since you didn’t show your returns, I wouldn’t expect them to be pulled.

“Stated income” type loans, although probably over used to get people into houses that they cannot afford, are supposed to be within “reasonable range” for amount of income for your type of work.

Answers to your fiscal questions

I don’t believe we scratched the surface with last week’s Q&A column, so here’s another round. I try to select questions that are representative of hot topics right now, so even if you don’t s

I’m Not a Slave Says Tax Protester Michele Seven