Third-party creditors may foreclose and sell property to which the federal tax lien attaches. These properties often sell at distress prices.

An investigation of these foreclosures, as outlined in IRM 5.12.4, may reveal that a redemption of such property is in the best interest of the IRS and ultimately of the taxpayer by yielding greater proceeds to pay towards their tax liability.

Redemption is the process by which the Government can purchase property sold at a distress price during a foreclosure sale and resell the property at a higher price to apply the excess proceeds to the taxpayer’s liability. In some instances, this procedure is the only means by which Federal tax liabilities can be collected.

The policies in this IRM are based upon the United States Code and IRC sections as shown in the following table:

The following Policy Statements and Delegation Orders regulate lien certificate, foreclosure, and redemption procedures:

The Director, Collection Policy is responsible for overseeing policy and procedures regarding the redemption program and related IRMs.

Collection Policy, Enforcement is responsible for development and delivery of policies within the lien program.

Managers of employees who work redemptions are responsible to ensure these procedures are followed and employee actions are timely and accurate.

Employees who work redemptions are responsible to follow the procedures in this IRM.

Other roles and responsibilities related to the lien program are shown in IRM 5.12.1.5, IRS Organizations Working Lien Issues, and its subsections.

Civil Enforcement Advice and Support Operations (CEASO) management is responsible to ensure effectiveness and measure objectives through management reviews. CEASO is also referred to more generally, and throughout this IRM, as “Advisory”.

Third-party foreclosures, which may result in redemptions, are subject to external audits.

Specific case activity on redemption cases is documented in the Integrated Collection System (ICS). ICS is used to control redemption activities and to document case work by Advisors, ROs, and Property Appraisal and Liquidation Specialists (PALS).

Access to systems used in working foreclosures is controlled using standard access guidelines through Business Entitlement Access Request System (BEARS).

The following table shows relevant terms used throughout this IRM.

The following table shows the acronyms used throughout this IRM.

See IRM 5.12.1-2 Exhibit, Glossary of Common Acronyms in IRM 5.12, for additional common acronyms used throughout IRM 5.12.

Related IRMs are referenced throughout this section. Other related sources include the Local Law Guides.

A redemption generally involves the following elements:

The Advisory executive determines the dollar criteria for working redemption investigations. This responsibility can be delegated to the Advisory TM.

The criteria for redemption investigations is based on the taxpayer's unpaid balance of assessment (UBA) and the government's equity in the property for redemption purposes. If this criteria is not met, then no investigation is initiated. At the discretion of Advisory leadership, this criteria is subject to change contingent upon factors that include:

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Once established, the criteria are subject to periodic review to ensure that they remain relevant.

Advisory has the primary responsibility for redemption investigations, however, ROs may need to do redemption investigations while working cases.

Once it is determined that a redemption investigation is warranted, open a Non-Field Other Investigation (NFOI) - 144, Redemption, on ICS within seven (7) calendar days. Document information of the investigation and redemption in the ICS history, including:

Advisory should utilize whatever resources are deemed appropriate by Advisory managers to gather all available information regarding the value of the property, before requesting assistance from either an RO or a PALS.

When considering whether to recommend redemption, the investigator must take the following actions:

Follow the guidelines in the table below to determine whether to proceed with a redemption investigation. ROs and/or PALS report their findings to Advisory.

While considering redemption, be alert to whether liens prior to the foreclosing encumbrance are outstanding and, if so, whether arrangements have been made to satisfy or make payments on them. The IRS has no authority to use the Revolving Fund to make direct payments on such encumbrances.

Before redeeming, review for potential toxic waste problems. If the potential exists, clean up costs should be considered.

When tentatively deciding to recommend redemption, take the following actions:

During the course of a redemption investigation, when the foreclosure sale purchaser, guaranteed bidder, redemption sale purchaser, other participant, taxpayer, representative, or IRS employee misses a specific deadline, including submitting required documentation and/or payment, follow-up is based on meeting the IRS’ requirements to maintain its standing in the proceeding. Follow-up should be initiated no later than fourteen (14) calender days after the missed deadline. This follow-up includes closing the case if this action is appropriate.

When circumstances dictate, the employee should use problem solving and negotiation techniques, considering the taxpayer’s, Power of Attorney’s, and/or third party’s perspective when working toward case resolution.

Any written notification or other communication should address the issue(s) clearly and in a language understandable to someone unfamiliar with IRS terms, acronyms and jargon.

Notice to the purchaser about the redemption must be hand-delivered or sent by certified or registered mail.

Prepare Letter 5597, Notification of IRS Right of Redemption, and send to the purchaser with the following forms:

A purchaser of real property at a foreclosure sale may request reimbursement for the following items:

A purchaser of real property at a foreclosure sale may request reimbursement for an amount equal to:

The foreclosure sale purchaser has the right to be reimbursed for necessary maintenance expenses (or fees) incurred during the time they are in possession of the property. These expenses are subject to review and can be recommended for approval either in whole or in part .

Specific maintenance expenses that may be considered are those utilized to keep the property safe and intact, such as those mentioned throughout this IRM. Expenses not listed can be considered as long as reasonable business prudence is administered when considering the expense. Examples of expenses to consider include:

Do not consider expenses to enhance or improve the property. Examples of unallowable expenses include:

Any type of maintenance expense claimed must be verified and justified as necessary under the circumstances. Unusual claims should be discussed and agreed to by the manager. If the legality of the expense is being challenged, Area Counsel concurrence is also needed.

The foreclosure sale purchaser's reimbursement request must be mailed or delivered:

The request must contain the following information:

Review the reimbursement request for adequacy and promptly contact the purchaser to correct any obvious defects. As necessary, refer the request through Advisory to Area Counsel for review.

The government will not reimburse a purchaser for any expenses or payment to a senior lienholder if the request is not timely mailed or delivered. However, if the purchaser shows reasonable cause, and the Advisory TM consents, the purchaser may request an extension for a reasonable period to submit, amend, or supplement a request for reimbursement. Any such extension request must be submitted before expiration of the applicable period for redemption.

The amount of reimbursement requested may be denied or approved, in whole or in part. The Advisory Group Manager (GM) has final approval whether the expenses are allowable.

If the IRS exercises its right to redeem the property, the amount requested for reimbursement must be approved and paid from the Federal Tax Lien Revolving Fund.

If the right to redeem is not exercised or a request for reimbursement is withdrawn, promptly return to the purchaser the waiver or other document by certified or registered mail or by hand delivery.

Requests for reimbursement generally should be denied only in cases where one or more of the following occur:

If reimbursement is denied, the purchaser must be notified of the decision in writing. The denial notification must:

When a reimbursement request is denied, the request shall be treated as having been withdrawn by the purchaser and to redeem the property the IRS shall tender only the amount otherwise payable.

In any case in which the United States redeems real property under 28 USC 2410 or IRC 7425, the amount to be paid for the redemption is the sum of all the following:

Commercial advertising to solicit bids may be judiciously used to broaden the field of potential bidders. Advertising must be approved in advance by the GM.

The advertisement, regardless of size, should be limited to a statement such as: "Prospective Purchasers of Real Property . . . the Internal Revenue Service is considering the redemption of real property located at (given address) . . . "

The advertising can provide a statement and contact number for parties not interested in being a guaranteed bidder, but who are interested in purchasing the property at the redemption sale.

Follow standard guidance in IRM 5.10.2.7, Contracting for Services, for securing advertising.

The taxpayer's account will not be debited for these expenses even if the property is not sold.

Redemption recommendations must include a guaranteed purchaser, unless the redemption is approved by the appropriate executive. Additionally, this prospective purchaser is generally required to submit an "Agreement to Bid" form with a deposit of at least twenty (20) percent of the bid amount.

The guaranteed bid must be an amount determined to be reasonable in relationship to the cost of redeeming, maintaining, and selling the property. This amount does not need to represent forced sale value.

The amount calculated as a guaranteed bid is subject to approval by the employee's manager. Final approval rests with the Advisory GM. If the field manager and the Advisory GM are unable to concur with the guaranteed bid amount, then the final decision will rest with the Advisory TM for the area in which the property is located.

Any person agreeing to bid at a redemption sale should complete Form 12673, Agreement to Bid for Redemptions. Ensure potential bidders are fully aware of the provisions in the event of default.

The prospective purchaser must guarantee their performance with a non-refundable deposit equal to at least twenty (20) percent of the agreed bid amount.

A deposit of less than 20 percent may be approved by the Advisory GM with Advisory TM concurrence. At a minimum, this will include written verification that this was discussed and agreed upon by both levels of management.

The deposit should be made by a certified, cashier's, or treasurer's check drawn on any bank or trust company incorporated under the laws of the United States or under the laws of any state, territory, or possession of the United States, or by a postal, bank, express, or telegraph money order.

Upon receipt of a bid deposit, prepare Form 2276, Collateral Deposit Record, identifying the remittance as an "agreement to bid deposit."

The redemption serial number will be completed following the format outlined below.

Since the revolving fund is not governed by fiscal year the files are maintained geographically and by territory.

The Advisory TM will determine where the serial numbers are maintained and monitored.

When a recommendation is made to exercise the right of redemption that will require an expenditure of $100,000.00 or more to redeem the property, the Advisory GM must consider the benefits of either assigning an Other Investigation (OI) to a PALS and/or enlisting the services of an IRS appraisal engineer or a professional appraisal firm. This decision must be documented prior to approving and forwarding the recommendation for Advisory TM approval.

In addition, when there is a question as to the extent of property boundaries, the Advisory GM is encouraged to consider the use of a professional surveyor to establish the exact nature of the property to be redeemed. The decision not to utilize these services should be documented and attached to the Form 4376. Otherwise, the results of the appraisal and/or survey must be included as a part of the investigation.

Under certain circumstances, and as warranted, it may be appropriate to contract out for a professional survey. This should be considered with redemptions involving acreage, multi-structure parcels, or any other property where it would prove to be in the Government's best interest. A professional survey may prove beneficial when considering the field employee’s determination of exact boundaries as well as ensuring property is included or excluded in the investigation. Contracting professional property appraisal services should also be considered when the services of a PALS or valuation engineer are not readily available, or if specialized expertise is required to accurately determine the value of a unique property.

The initial decision to utilize an outside contractor generally is made by the RO or PALS and their GM. The feasibility of contracting out should then be discussed with the advisor and Advisory GM. The Advisory and field GMs should be in agreement that circumstances warrant outside contractor consideration, although the final decision rests with Advisory. If the two managers are in disagreement, then the final decision rests with the Advisory TM.

When outside services are used, expenses must be requested and approved following the procedures in IRM 5.10.2.7, Contracting for Services.

Expenses incurred for this type of procurement are paid from the "enforcement expense budget." This expense is predicated on an internal decision to utilize an outside contractor and will not be assessed against the taxpayer’s account. Specifics regarding the request and approval of funds should be discussed in detail with the SB/SE Field Budget Office.

The approval path for all outside contractor requests is: Initiator ⇒ Advisory GM ⇒ Advisory TM ⇒ SB/SE Field Budget plan manager.

After the recommendation to redeem property is approved by the appropriate official (see IRM 5.12.5.5, Processing Redemption Recommendations), prepare a memorandum for the Advisory GM signature requesting an advance from the revolving fund. The memo must provide the following information extracted from the redemption report:

Email the digitally-approved request for monies from the revolving fund to the SB/SE Operations Budget Analyst. See the Federal Tax Lien Revolving Fund page of the Budget Management Knowledge Base for specific contact information. The time period to exercise the right of redemption is generally 120 calendar days from the date of the foreclosure sale. It is therefore necessary to process requests for funds as promptly as possible.

The request sent to the SB/SE Budget Analyst should include the following:

The Budget office determines the availability of funds and the priority for disbursement when available funds may be insufficient to meet two or more requests. This serves to avoid depletion of the fund.

The Budget office employee notifies the Advisory GM and/or advisor in writing to certify that funds are available. The notification serves as documentation of an approved request for funds for the redemption of real property.

Based on authorization from the Budget office, Beckley Finance Center generally issues a manual check to the employee making the request. Beckley Finance Center must have a copy of the memorandum referenced in (1) above. This is required for their file documentation.

Allow a minimum of five (5) business days for processing of requests for revolving fund advances. It is important to ensure that there is ample time to process the request and for mailing of the funds from Beckley Finance Center.

The Advisory GM has follow-up responsibilities to ensure that the revolving fund is repaid. See IRM 5.12.5.8.6, Transmittal Memorandum for Redemption Sale, as well as IRM 5.10.7.8, Report of Disposition - Sale of Redeemed Property, for additional information.

If a redemption investigation is subsequently cancelled, advances must be returned immediately to Beckley Finance Center.

If a revolving fund advance has been distributed and cannot be returned to Beckley Finance Center, consult with Area Counsel for avenues to retrieve the advance. The advisor must submit a status report monthly on the situation. After ninety (90) calendar days, the Advisory GM must secure Advisory TM concurrence of continued delays. Advisory TM concurrence is required every thirty (30) days thereafter until the fund is reimbursed or Advisory TM determines the funds are irretrievable and a memorandum signed by the Advisory TM reports a loss for the revolving fund to both Beckley Finance Center and the SB/SE Field Budget Office.

Delivery of the check for the redemption to the purchaser must be done promptly upon receipt of the check from the revolving fund.

The employee who has been designated to tender the amount required to redeem must be accompanied by at least one witness -- preferably an advisor, Area Counsel attorney, or RO, but any IRS employee may assist.

An acknowledgment of receipt of the check should be secured from the purchaser, if possible.

In the event that the tender to redeem is refused, prepare a report of the transaction and forward through Advisory to Area Counsel for an advisory opinion and guidance as to the next action to be taken.

The report should include a request for instructions as to the immediate disposition of the check that had been tendered.

It is essential that a timely tender of the amount required to redeem be made to the proper person. If the person who purchased the property at the foreclosure sale has conveyed it to another, the IRS may still redeem the property from the subsequent purchaser (i.e., "successor in interest" ). The advice of Area Counsel should be solicited to ascertain the proper party and amount to be tendered.

When the IRS executes its redemption rights, evidence of the redemption must be recorded in the public record.

After the determination to redeem is approved, Advisory contacts the local official designated by law to determine the documents necessary to show the redemption. If no such official has been designated by local law, the official fails to issue the necessary documents, or there are no standard documents under local law, the Advisory TM is authorized to issue a certificate of redemption.

Consult Area Counsel for guidance as to the form of the certificate to be used in each jurisdiction.

Preparation of the certificate of redemption is done by the advisor assigned to work the investigation.

The authority to sign a certificate of redemption is delegated to the Advisory TM. In cases where there is no guaranteed purchaser, the certificate of redemption must be signed by the IRS executive over Advisory. See IRM 1.2.2.6.4, Delegation Order 5-4 (Rev. 3), Federal Tax Lien Certificates.

The certificate of redemption may be prepared either before the check is delivered to the payee or immediately afterwards provided sufficient time exists to permit filing the certificate before the redemption period expires.

The certificate will be prepared in duplicate by Advisory and disposed of as follows:

Document the ICS history about the redemption, including the following:

Advisory must ensure the certificate is promptly recorded in the proper recording office. Advisory incorporates the assistance of an RO or PALS, who must:

If the state where the real property is redeemed has not designated an office in which the certificate should be recorded, the certificate shall be filed in the office of the clerk of the United States District Court for the judicial district in which the redeemed property is situated.

Consult Area Counsel, as needed, for the proper place for recording the certificate in each jurisdiction.

Redeemed property may be leased to a third party if it is determined that it will be in the government’s possession for an extended period of time and that the government's interest will best be served by such action.

The initial determination to lease the property is made by the advisor with concurrence from the Advisory GM and is based upon the circumstances of the investigation. Approval of the Advisory TM must be secured before the property is offered.

When it is determined that redeemed property will be leased and a prospective lessee has been secured, Advisory must request assistance from Area Counsel in preparing the lease agreement. The lease agreement:

Advisory should furnish Area Counsel with the following information:

Upon receipt of the concurrence from Area Counsel, the Advisory GM reviews the lease to see that it conforms to the intent of the parties involved and forwards the original and duplicate to the Advisory TM for approval.

After Advisory TM approval, take the following actions:

Advisory should discuss with Area Counsel how payment received from the leased property should be applied. Most likely, any payments should be applied first to the revolving fund balance and then to the taxpayer's liability. See IRM 5.10.7.3(4), Income from Acquired Property, for additional information on preparation of a memorandum for lease payments.

If a payment is not received within a reasonable time after the due date, Advisory should contact the lessee to secure payment. If payment is not received, consult Area Counsel as to the legal action required. Refer to IRM 5.10.7.3.1, Lease of Real Property, for additional information.

IRC 7506 provides the authority to sell redeemed property. The administration and disposition of real property is the responsibility of the Advisory TM for the area where the real property is situated. The Commissioner may, if deemed advisable, take charge of and assume responsibility for the administration and disposition of the property by giving written notice to the Advisory TM through the appropriate executive.

If real property consisting of a single parcel is situated in more than one area/territory, the responsibility for the administration and disposition of the property is that of the Advisory TM under whose direction the property was redeemed. If there is doubt as to which Advisory TM has charge of the property, the pertinent facts should be reported to the appropriate executive so that a designation may be made.

For information on the sale procedures, see IRM 5.10.7.4, Preparations for Sale.

After the sale, the employee conducting the sale prepares a report entitled "Report of Sale of Redeemed Property" and forwards it to Advisory with all applicable attachments. The report must include the following information:

Vouchers for sale expenses should be attached to the duplicate report.

Attachments to the original of the report should include the following:

Upon receipt of the reports, Advisory forwards the duplicate report, with any vouchers not previously submitted and the Area Counsel concurrence memorandum, to both the Budget office and to Beckley Finance Center.

Document actions relative to the sale and post -sale actions in the ICS history, including the amount of tax liability satisfied.

Regulations under IRC 7506 provide that, upon payment in full of the purchase price, the IRS will issue a deed to the purchaser.

Advisory prepares the deed and forwards it to Area Counsel for review.

Upon Counsel’s concurrence, forward the deed to the Advisory TM for signature. In the signature package, include the report of sale and any other information requested by the TM.

After securing the signed deed, make a copy for the redemption file and make arrangements for the delivery of the deed. Furnish the original deed to the purchaser and note the date of delivery on the copy of the deed.

Ensure the purchaser is advised of their responsibility to file the deed with the appropriate recording office.

Proceeds from the redemption sale are first used to reimburse the revolving fund. If there are insufficient proceeds from the sale to fully reimburse the fund, notify Beckley Finance Center by memorandum or by secure E-mail following the procedures in IRM 5.12.5.6.1, Advances from the Revolving Fund.

Proceeds remaining after reimbursing the revolving fund are applied in accordance with IRC 6342(a) and in the same manner as funds realized from levy proceeds. Legitimate property maintenance, preservation, and sale expenses incurred while bringing the redeemed property to sale are deducted first and the net amount is credited to the taxpayer's account.

After reimbursement of the revolving fund and full payment of the taxpayer's liability, any remaining surplus is refunded, in accordance with IRC 6342(b), to the person entitled to receive the funds. Interest is paid on surplus proceeds in accordance with IRC 6611. The party generally entitled to these surplus proceeds is the taxpayer. Junior lienholders are not entitled to proceeds from the sale of redeemed property, and they should not be notified. If Advisory cannot determine the party entitled to the surplus proceeds, refer the case to Area Counsel for a legal opinion prior to any disposition of this surplus.

A transmittal memorandum entitled "Proceeds from the Sale of Redeemed Property" should be promptly prepared after the completion of the sale by the employee that conducted the sale. The memorandum must contain the following information:

Forward the memorandum and any accompanying remittances to Advisory for review. Advisory is responsible for transmitting the memorandum, remittances, and the purchaser's deposit (if any) to the Beckley Finance Center.

Advisory is also responsible for returning any other deposits submitted with unsuccessful "agreements to bid" , unless it was as a result of the depositor defaulting on the agreement.

When payment of the full purchase price is deferred, the purchaser's deposit must be promptly forwarded to Beckley Finance Center for deposit to the revolving fund. This also applies to any deposit the purchaser may have made with an "agreement to bid" prior to the sale. Advisory must ensure that the funds are correctly identified to Beckley Finance Center.

The purchaser's payment of the balance must also be clearly identified for Beckley Finance Center. Duplication of memorandums is not required for each of these scenarios, as long as Beckley Finance Center is understanding of what the funds represent. This can be accomplished through a telephone call, memorandum, or secured E-mail message. Advisory is responsible for ensuring that communication efforts with Beckley Finance Center are clearly understood and well documented in the ICS history.

Advisory must follow-up on the redemption within sixty (60) calendar days from when money was received from the revolving fund. If there is a delay in repayment to the revolving fund, Advisory must notify Beckley Finance Center by memorandum or by secure E-mail, giving the redemption serial number, amount secured from the revolving fund, explanation for the delay, and the new estimated repayment date. Advisory must submit a status report to Beckley Finance Center every thirty (30) calendar days after the initial 60-day time period has expired. If, after 90 days, the amount remains unpaid, Advisory TM concurrence must be obtained for continued delays.

See also IRM 5.10.7.8, Report of Disposition - Sale of Redeemed Property, for additional information.

Advisory maintains a record of the distribution of all redemption proceeds in the redemption file.

Upon receipt of the transmittal and gross proceeds from Advisory, Beckley Finance Center takes the following actions:

Advisory identifies where to apply to the taxpayer's account the amount that remains after repayment of the revolving fund.

All payments directly related to Redemption and Release of Right of Redemption should be applied to the taxpayer's account using Transaction Code (TC) 670 with Designated Payment Code (DPC) 58.

When surplus proceeds remain after reimbursement of the revolving fund and application of proceeds under IRC 6342(a), Advisory will deposit these funds in the 4720 Deposit Fund Account located at the Ogden campus. A memorandum will be completed in duplicate. The memorandum will be titled "Surplus Proceeds—Redemption Sale" and will contain the following:

The original of the memorandum will be used as a posting document to submit the funds to the Ogden Campus for processing. A copy of the memorandum will be placed in the Redemption file and in the "Surplus Proceeds—Redemption Sale" file to be established.

Payment of surplus proceeds will need to be coordinated between the Ogden Campus staff and the advisor assigned to monitor the status of payment. This will likely be in the form of a manual check being issued to Advisory for delivery to the appropriate party in accordance with IRC 6342(b). A record of the surplus proceeds will be referenced in the history section of ICS. Indicate the amount as "Surplus Proceeds—Redemption Sale. "

Applications for release of right of redemption should be submitted on Department of Justice Form OBD–225, Application for Release of Right of Redemption in Respect of Federal Tax Liens. This form may be obtained from the United States Attorney’s Office in the state where the property is located, see www.justice.gov to locate that office.

The person requesting the release of right of redemption should submit the form, together with remittance and all necessary evidence, to the United States Attorney for the area in which property subject to the right is located.

Upon receipt of an application for release of right of redemption, the U. S. Attorney should forward the original application, together with accompanying documentation, to Advisory for verification and recommendation.

If an application is complete and proper, a field investigation is not required, unless Advisory has information warranting an investigation. A field investigation will not be required on any application made by the Veterans Administration or any other Federal Agency regardless of value or use. An exception to the general rule may be determined by the Advisory GM with Advisory TM concurrence. In the rare case when a field investigation is needed, Advisory should take the following actions:

Advisory will complete Part B of any application that does not require a field investigation. Before a recommendation is made, Advisory must be satisfied that the appraisals were made by disinterested persons and that they were qualified to make appraisals. A memorandum report specifically stating that the appraisers involved are disinterested and qualified will be prepared and accompany the application. In those cases in which the applicant is a Federal agency, the appraised value furnished in the application will be accepted as correct and no statement will be necessary.

Applications requiring field work shall be investigated promptly by an RO or a PALS in order that final disposition may be made by Advisory within thirty (30) calendar days. The employee assigned to investigate the application shall verify each item contained in the application or which, in accordance with the requirements prescribed, should have been contained in the application.

The investigating employee shall gather sufficient facts to make a determination whether the United States should release its right of redemption.

In accordance with Delegation Order 5-4, approving the release of the right of redemption is currently delegated to the Advisory GM.

The investigating employee prepares a report of investigation when the investigation is completed. The report should specifically state whether the appraisers involved are disinterested and qualified. The report is submitted to Advisory.

The Advisory GM is responsible for determining whether the final report will be on Form 4376 or in memorandum form.

Upon receipt of the investigator's report, Advisory reviews it to ensure that there is sufficient information to determine whether the right of redemption should be released. Advisory completes the application by indicating the recommendation and the manager’s approval.

Upon approval of the Advisory GM, forward the original and one copy of the application, with copies of the investigator's report attached, to the Department of Justice following local protocol. Maintain a copy of the application, the set of appraisals and a copy of the report.

DOJ or Advisory provides a copy of the approved application to the applicant in exchange for payment of the amount required for the release of the right of redemption. If DOJ receives the payment, it is forwarded to the lockbox for posting. Apply the payment to the taxpayer's outstanding liability.

Applications for release of right of redemption, and all necessary evidence, should be sent by applicants to the attention of the Advisory GM for the area in which property subject to the right is located. See Pub 4235, Collection Advisory Group Addresses.

Furnish potential applicants Pub 487, How to Prepare Application to Release Property Secured by a Federal Tax Lien, as needed.

Process applications promptly, utilizing the services of Area Counsel as needed.

The investigating employee shall gather sufficient facts to determine whether the United States should release its right of redemption. The investigation may be terminated when it is found that there is an encumbrance(s) prior to the foreclosing lien holder in excess of the value of the property.

The investigating employee prepares a redemption report upon completion of the investigation. The report should be completed using Form 4376 and may include a memorandum containing additional information, if necessary.

Forward the report, with the copy of the application and all exhibits, through the group manager to Advisory.

When a Release of the Right of Redemption is warranted, Advisory prepares the appropriate document for signature approval. ICS templates are available for this purpose.

Prepare the release in duplicate for approval.

In accordance with IRM 1.2.2.6.4, Delegation Order 5-4 (Rev. 3), approving the release of the right of redemption is currently delegated to the Advisory GM.

Give the original to the applicant upon receipt of the amount determined to be the Government's interest. Retain the duplicate in Advisory.

Apply any payment secured for the release of the right of redemption to the taxpayer's outstanding liability using TC 670 with DPC 58.