Lenders are going to require that you have filed tax returns. If you haven’t filed in years and you were supposed to, that would be a problem more than likely. If you have IRS liens, it will more than likely show up on the title search even if not on the credit report. Lenders care about IRS liens because it may supercede the lender’s first mortgage position You would also need to ask a CPA about your request and think about asking questions like this before you do it because you don’t want to purposely avoid the IRS/government
When You Owe the IRS and Want to Buy a Home
It’s probably best to file taxes and see what you owe before tying up your money on a house that you may need to pay your past taxes. Also, if you were to some how get a loan on a house and the IRS were to put a lien on your paycheck or tax returns, you may end up losing your home if you can’t afford the mortgage in that situation.
Failing to pay your federal income taxes can lead to the Internal Revenue Service placing a lien on your property or your assets. These legal tools protect the government’s ability to get its money. They also set off alarm bells for lenders.
The good news is the presence of a federal tax lien doesn’t automatically ruin your home-buying chances. It’s almost always more a matter of what you’re doing to make the lien go away. So, if you’re a prospective home buyer with a tax lien, a good first step is making sure your track record shows at least a year’s worth of on-time payments. Pay it off in full if possible, but if that’s a tall order, know that you might have diminished purchasing power and a rockier road until the slate is clean.
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