Publication 783 (Rev. 12-2022)

How to Apply for a

Certiﬁcate of Discharge From Federal Tax Lien

A Certicate of Discharge under Internal Revenue Code Section

6325(b) removes the United States’ lien from the property

named in the certicate. Discharge of property under Internal

Revenue Code Section 6325(c) subject to an Estate Tax Lien is

not covered in this publication. For Estate Tax Lien discharges

see instead the application and instructions found in Form 4422

1. Complete Form 14135, Application for Certiﬁcate

of Discharge of Federal Tax Lien attached with this

publication.

2. Mail the completed Form 14135 and the appropriate

attachments to:

IRS Advisory Consolidated Receipts

7940 Kentucky Drive, Stop 2850F

Florence, KY 41042

(Refer to Publication 4235 Collection Advisory Group

Addresses for additional contact information.)

If you have any questions, contact the Advisory Consolidated

Receipts Ofce at 859-594-6090.

If you want to know how much you owe in order to pay the

lien(s) in full, call 1-800-913-6050, visit the nearest Taxpayer

Assistance Center, or contact the revenue ofcer assigned to

your case.

Important!

Please submit your application at least 45 days before the

transaction date that the certicate of discharge is needed.

Doing so will allow sufcient time for review, determination,

notication and the furnishing of any applicable documents by

the transaction date.

Information Required on the Application

Section 1 - Taxpayer Information

1. Enter the name and address of the individual(s) or business

as it appears on the Notice of Federal Tax Lien (NFTL). A

second name line is provided if needed.

2. Enter, if known, the last 4 digits of the social security

number (SSN) or full employer identication number as it

appears on the NFTL.

3. Enter, if known and if applicable, the last 4 digits of any

spousal SSN (secondary SSN) associated with the tax debt

listed on the NFTL.

4. Provide a daytime phone number and a fax number.

Section 2 - Applicant Information

1. Check the box on the rst line of Section 2 if you are both

the taxpayer and the applicant. If you are not the taxpayer,

attach a copy of the lien.

2. If you have checked the box indicating that you are the

taxpayer and your information is the same as listed on the

lien, enter “same as taxpayer” on the name line.

3. If you are not the taxpayer or you are the taxpayer but your

information is no longer the same as the information on the

Notice of Federal Tax Lien, enter your name (include any

name changes), current address, daytime phone number

and fax number.

Publication 783 (Rev. 12-2022) Catalog Number 46755I Department of the Treasury Internal Revenue Services www.irs.gov

4. If you are not the taxpayer, enter in the box next to “Name”

your relationship to the taxpayer (e.g. parent, uncle, sister,

no relation, etc).

Section 3 - Purchaser/Transferee/New Owner

1. Check the box on the rst line of Section 3 if you are both

the property owner and the applicant.

2. Enter the name of the property owner. Or enter “NA” if you

have checked the box indicating you are both the applicant

and the property owner, enter, “same as applicant”.

3. Enter the property owner’s relationship to the taxpayer (e.g.

taxpayer, parent, no relation, etc.).

Section 4 - Attorney/Representative Information

This section is used to list the taxpayer’s representative or a

representative of a party other than the taxpayer, such as the

lender, needing to receive information from the IRS. However,

you do not need a representative to request discharge of the

federal tax lien.

1. Check the box on the rst line of Section 4 if you are

attaching a Form 8821 (Tax Information Authority) or Form

2848 (Power of Attorney) with your application. If you

are attaching one of these forms, please make sure it is

completely lled out, signed, and dated. You must provide

one of these forms if the representative represents an

interest other than the taxpayer.

2. Enter the name, address, phone number, and fax number

of your representative in this action. The IRS will work with

you and your representative to process your application.

Or enter “NA” on the name line if you are not using a

representative.

3. Enter whose interest the representative represents (e.g.

taxpayer, lender, title company, etc.). This allows the IRS

to determine what information can be shared with the

representative.

Section 5 – Lender/Finance Company Information

(Settlement/Escrow Company for Section 6325(b)(3) only)

Enter the company name, contact name, and phone number for

the title or escrow company that will be used at settlement.

Section 6 – Monetary Information

1. Provide the proposed property sale amount

2. Provide the amount of proceeds the IRS can expect for

application to the tax liability.

3. Enter NA for the amount of proceeds the IRS can expect, if

you anticipate there will be no proceeds.

Section 7 - Basis for Discharge

Discharge of property from the federal tax lien may be granted

under several Internal Revenue Code (IRC) provisions. After

reviewing the discharge sections, explanations, and examples

below, select the discharge section that best applies to your

application. If the IRS does not agree with your selection after

its review, an explanation of the decision will be provided.

1. 6325(b)(1) – a discharge may be issued under this

provision if the value of the taxpayer’s remaining property

encumbered by the federal tax lien is equal to at least twice

the amount of the federal tax liability secured by the lien

and any encumbrance entered into before the IRS led its

public notice of the lien. If there are mortgages, state and/

or local taxes, mechanics liens, etc., the amount of these

debts would be added to the amount of the tax liability and

multiplied by 2.

Example

Tax liability $15,500

Other Debts + $23,334

$38,834

x 2

$77,668

The property remaining subject to the lien must be at least

$77,668.

2. 6325(b)(2)(A) – a discharge may be issued under this

provision when the tax liability is partially satised with an

amount paid that is not less than the value of the United

States’ interest in the property being discharged. For

example, the IRS has a lien totaling $203,000 and:

• Property selling for: $215,000

• Minus encumbrances senior to IRS lien: $135,000

• Minus proposed settlement costs: $ 15,000

• The IRS lien interest equals: $ 65,000

After the IRS receives and applies the $65,000 in partial

satisfaction of the tax liability, there remains an outstanding

tax debt of $138,000.

In the case of Tenancy by Entireties property, the United

States is generally paid one-half of the proceeds in partial

satisfaction of the liability secured by the tax lien.

3. 6325(b)(2)(B) – a discharge may be issued under this

provision when it is determined that the government’s

interest in the property has no value. The debts senior to

the federal tax lien are greater than the fair market value of

the property or greater than the sale value of the property.

Submit a copy of the proposed escrow agreement as part

of the application.

4. 6325(b)(3) – a discharge may be issued under this

provision if an agreement is reached with the IRS allowing

the property to be sold. Per an escrow agreement the sale

proceeds must be held in a fund subject to the claims

of the United States in the same manner and priority

the claims had prior to the property being discharged.

For example, there are two mortgages senior to the IRS

tax lien totaling $32,000 and $5,000. The government’s

interest in the property is $40,000 and there are liens on

the property junior to the IRS lien in the amount of $3,000,

$12,000 and $2,990. The proceeds from the sale would be

dispensed by paying the debts in the following sequence.

a. $32,000

b. $5,000

c. $40,000

d. $3,000

e. 12,000

f. $2,990

Submit a copy of the proposed escrow agreement.

5. 6325(b)(4) – a discharge will be issued under this provision

to a third party who owns the property if a deposit is made

or an acceptable bond provided equal to the government’s

interest in the property. In the case of Tenancy by

Entireties property, a deposit or an acceptable bond

totaling one-half the government’s interest in the property

must be made. If you are the property owner (but not the

taxpayer, i.e., you are not responsible for the tax liability)

and you make a deposit or post an acceptable bond to

obtain a discharge under this section, you have 120 days

to le an action in federal district court, under section

7426(a)(4), challenging the IRS’ determination of the

government’s lien interest. This is the exclusive remedy

available to the third party for the return of the deposit

or accepted bond or a portion thereof. An administrative

request for refund and a refund suit in district court is not

available. The Circular 570, available at https://scal.

treasury.gov/surety-bonds/ contains a list of companies

certied by the Secretary of the Treasury as providers of

acceptable securities.

6. 6325(c) – a discharge of property subject to an Estate Tax

Lien is not covered in this publication. Please refer to Form

4422.

Section 8 – Description of Property

1. Enter a detailed description of the property to be

discharged from the federal tax lien.

2. When the property is real estate include the type of

property, for example, 3-bedroom house; etc. When the

property is personal property include serial or vehicle

numbers, as appropriate, for example, 2002 Cessna twin

engine airplane, serial number AT919000000000X00; etc.

3. Provide the physical address if real estate or physical

location address if personal property.

4. Check the appropriate box to indicate whether you

attached a copy of the title or deed to the property.

5. If you are applying under 6325(b)(1) check the “Attached”

box and attach copies of the titles or deeds for property

remaining subject to the lien. If you are not applying under

6325(b)(1) check the “NA” box.

Section 9 – Appraisal and Valuations

1. Check the “Attached” box after “Required Appraisal”

indicate whether you have attached the required

appraisal by a disinterested third party. This is typically a

professional appraisal providing neighborhood analysis;

description of the site; description of the improvements;

cost approach; comparable sales; denition of market

value; certication; contingent and limiting conditions;

interior and exterior photos of the property; exterior photos

of comparable sales used; comparable sales location map;

sketch of subject property showing room layout; ood map

and qualications of the appraiser.

2. Check the appropriate box under the “Plus One of the

Following Additional Valuations” section to indicate which

other type of property value verication is attached with

your application.

Note: For applications under IRC 6325(b)(1), valuation

information described above must also be provided for

property remaining subject to lien.

Note: For property being sold at public auction, provide

the date and place of the sale, the proposed amount for

which the property will be sold, and a statement that the

United States will be paid in the proper priority from the

proceeds.

Section 10 − Federal Tax Liens

This section is important when the applicant and the taxpayer

are different. If the applicant and the taxpayer are the same, this

section may be skipped.

1. Check the “attached” box if you have attached copies of

the liens with your application.

2. If you checked the “no” box list the System Lien

Identication Number (SLID) found in the top right hand

box of the lien document, if available. If you do not have

the number(s) enter “unknown” in the rst box.

Section 11 − Sales Contract/Purchase Agreement

1. Check the box indicating whether the proposed sales

contract or purchase agreement is attached.

2. If you checked the “no” box, describe how the taxpayer

named on the lien will be divested of their interest in the

property or why they have no interest in the property.

Section 12 − Title Report

1. Check the box indicating whether the title report is

attached.

2. If you checked the “no” box, use the space provided to list

any encumbrances (liens or claims) against the property

that came into existence before the United States’ lien

interest or which have priority over the lien. Include name

and address of holder; description of encumbrance,

e.g., mortgage, state lien, etc.; date of agreement;

original amount and interest rate; amount due at time

of application; and family relationship of the holder, if

applicable.

3. Attach a separate sheet with the information in item # 2

above if there is not enough space provided on the form.

Section 13 − Closing Statement

1. Check the box indicating whether the proposed closing

statement is attached. This statement is often referred to

as a HUD-1.

2. If you checked the “no” box, use the space provided to

itemize all proposed costs, commissions, and expenses of

any transfer or sale associated with property.

3. Attach a separate sheet with the information in item # 2

above if there is not enough space provided on the form.

Section 14 − Additional Information

1. Check the box indicating whether you are attaching other

documents relevant to the discharge application. This

could include afdavits or court documents.

2. Check the “no” box if you do not have any additional

documentation.

Section 15 − Escrow Agreement

1. Check the box indicating whether you are attaching a

draft escrow agreement. This is only applicable if you are

applying under 6325(b)(3).

2. An escrow agreement must specify type of account,

name and depositary for account, conditions under which

payment will be made, cost of escrow, and the name

and address of any party identied as part of the escrow

agreement.

Section 16 − Waiver

This section applies only if you are:

• The property owner, but

• Not liable for the tax debt (i.e. not named on the lien), and

• Applying under 6325(b)(2)(A).

By checking the “Waive” box you are waiving the option to

have the payment treated as a deposit under section 6325(b)(4)

which has the accompanying right to request a return of funds

and to bring an action under section 7426(a)(4).

If you check the “no” box, your application will automatically

be considered under 6325(b)(4) which provides for return of

deposited funds and a court challenge under 7426(b)(4).

Section 17 − Declaration

The applicant or their authorized Power of Attorney signs

the application form. You must sign your application under

penalties of perjury attesting to having examined the

application, accompanying schedules or documents, exhibits,

afdavits, and statements and declaring to the best of your

knowledge and belief that it is true, correct and complete.

Frequently Asked Questions

Q1: When do I make a payment?

The Internal Revenue Code section under which the certicate

of discharge will be issued or granted determines the details

regarding making a payment.

• Discharge under 6325(b)(1) or 6325(b)(2)(B) does not

require a payment.

• Discharge under 6325(b)(2)(A) requires a payment, but do

not send a payment with the application. The Advisory

Group Manager will notify you, after determining the

amount due, when to send payment.

NOTE: If a mortgage foreclosure is anticipated, the

application is made under section 6325(b)(2)(A) or 6325(b)(2)(B).

A determination will be made that either an amount is required

for discharge or the United States’ interest is valueless.

In the case of foreclosure you will receive, within 30 days of the

receipt of a complete and approved application, a conditional

commitment letter for a certicate of discharge.

NOTE: Relocation Expenses - If a discharge under 6325(b)(2)

(A) or 6325(b)(2)(B) is issued and if the sale is of the principal

residence, the taxpayer may be eligible for a relocation expense

allowance because of an inability to pay. The relocation

expense allowance is subject to limitations. To apply for

the allowance complete and submit Form 12451, “Request

for Relocation Expense Allowance” with the application for

discharge.

Discharge under 6325(b)(3) requires a payment, but do not

send a payment with the application. First, the draft escrow

agreement must be submitted.

Second, the Advisory Group Manager approves the escrow

agent selected by the applicant; any reasonable expenses

submitted as incurred in connection with the sale of the

property; the claim amounts and priorities, and the distribution

timing of the fund.

Third, the agreement is nalized and contains signatures of all

parties involved including Advisory Group Manager prior to the

discharge being issued.

Note: The escrow account must be funded before payment of

any claim or lien through money paid by the applicant or from

the sale proceeds.

Discharge under 6325(b)(4) requires a bond or deposit but do

not send one with the application. The Advisory Group manager

must rst determine the amount of bond or deposit needed

for the discharge and determine that the bond company, if

applicable, is from the approved list.

Q2: What is an acceptable form of payment?

Make payments in cash or by the following types of checks:

certied; cashiers; or treasurer’s check. The check must be

drawn on any bank or trust company incorporated under the

laws of the United States, or of any state, or possession of

the United States. Payment can also be made using a United

States postal, bank, express or telegraph money order.

Important! If you pay by personal check, issuance of the

certicate of discharge will be delayed until the bank honors the

check.

Q3: Who makes the decision to issue a Certiﬁcate of

Discharge?

In all cases Advisory staff will review and verify the information

provided, determine whether a certicate of discharge should

be issued, and contact you with any questions. Advisory may

contact you, your representative, or any person relative to the

transaction for additional information.

The Advisory Group Manager has the responsibility to review

and approve the determination and let you know the outcome.

If approved, you will receive a conditional commitment letter.

Q4: When will I receive the Certiﬁcate of Discharge?

The Internal Revenue Code under which the certicate of

discharge will be issued or granted and the time at which you

are divested of your interest in the property determines when

you will receive the certicate.

• Under 6325(b)(1) you will receive the certicate when it is

determined the remaining property meets the criteria of the

provision.

• Under 6325(b)(2)(A) you will receive the certicate after

IRS receives payment of the agreed upon amount in partial

satisfaction of the tax liability, proof that the taxpayer has

been divested of title, and receipt of a copy of the nal

settlement statement.

• Under 6325(b)(2)(B) you will receive the certicate when

it is determined that the government’s interest in the

property is valueless, the IRS has received proof that the

taxpayer has been divested of title, and a copy of the nal

settlement statement.

NOTE: Under provisions 6325(b)(2)(A) and 6325(b)(2)(B) at

the conclusion of a mortgage foreclosure the certicate will

be issued in accordance with the terms of the conditional

commitment letter. Also see, Publication 487, How to Prepare

an Application Requesting the United States to Release Its

Right to Redeem Property Secured by a Federal Tax Lien.

• Under 6325(b)(3) you will receive the certicate when the

amount of the government’s interest in the property has

been placed in the approved escrow account.

• Under 6325(b)(4) you will receive the certicate when the

amount equal to the government’s interest in the property

is received or an approved bond has posted.

Q5: What happens if my application is denied?

If your application is denied, you will receive Form 9423,

Collection Appeal Request and Publication 1660, Collection

Appeal Rights, with an explanation of why your application was

denied.

Privacy and Paperwork Reduction

Act Notice

The Privacy act of 1974 says that when we ask you for

information about yourself, we must rst tell you our legal right

to ask for the information, why we are asking for it, and how it

will be used. We must also tell you what could happen if you do

not provide it and whether or not you must respond under the

law.

We ask for the information on this form to carry out the Internal

Revenue laws of the United States. This information requested

on this form is needed to process your application and to

determine whether the federal tax lien can be discharged. You

are not required to apply for discharge; however, if you want the

federal tax lien to be discharged, you are required to provide

the information requested on this form. Section 6109 requires

you to provide the requested identication numbers. Failure to

provide this information may delay or prevent processing your

application; providing any false information may subject you to

penalties.

The time needed to complete and le this form will vary

depending on individual circumstances. The estimated burden

for individuals ling this form is approved under OMB control

number 1545-2174. The estimated burden for those who le

this form is shown below.

• Recordkeeping 2 hr., 45 min.

• Learning about the law or the form 2 hr.

• Preparing the form 1 hr., 30 min.

• Copying, assembling, and sending the form to the IRS 85

min.

Routine uses of this information include giving it to the

Department of Justice for civil and criminal litigation, and

to cities, states, the District of Columbia, and United States

commonwealths and possessions for use in administering their

tax laws. Advisory may contact you, your representative, or any

person relative to the transaction for additional information.

We may also disclose this information to other countries

under a tax treaty, to federal and state agencies to enforce

federal nontax criminal laws, or to federal law enforcement and

intelligence agencies to combat terrorism.