IRS Form 14134, also known as the Application for Certificate of Subordination of Federal Tax Lien, is a legal document taxpayers use to request that the Internal Revenue Service (IRS) subordinate their federal tax lien to a senior lien. This form is typically used when a taxpayer wishes to refinance their home or secure a loan for another purpose but is unable to do so because of a federal tax lien.

A federal tax lien is a legal claim that the IRS places on a taxpayer’s property to secure payment of unpaid taxes. This lien gives the IRS a priority claim on the property over other creditors and can make it difficult for the taxpayer to sell or refinance their property. However, the IRS can subordinate its lien to a senior lien under certain circumstances.

To apply for a certificate of subordination, taxpayers must complete and submit Form 14134 to the IRS. The form requires information about the taxpayer, including their name, address, and taxpayer identification number, as well as information about the property subject to the lien, such as the property address and legal description. Taxpayers must also provide information about the senior lien, including the lender’s name and address and the loan amount.

In addition to the form, taxpayers must also submit documentation to support their application for subordination. This includes a copy of the proposed loan or refinancing documents and proof of the outstanding taxes, such as a copy of the notice of federal tax lien.

The IRS will review the application and supporting documentation to determine if the taxpayer meets the criteria for subordination. The criteria for subordination are outlined in Internal Revenue Code section 6323(b), which states that the IRS may subordinate its lien if it is in the government’s best interest to do so. The IRS will consider factors such as the property’s value, the amount of the outstanding taxes, and the likelihood of the taxpayer being able to pay their taxes if the lien is subordinated.

If the application is approved, the IRS will issue a certificate of subordination, which will be recorded in the county where the property is located. This certificate will state that the IRS’s lien is subordinate to the senior lien and will no longer have priority over it.

In conclusion, IRS Form 14134, Application for Certificate of Subordination of Federal Tax Lien, is a legal document used by taxpayers to request the IRS to subordinate their federal tax lien to a senior lien. This form is typically used when a taxpayer wishes to refinance their home or secure a loan for another purpose but cannot do so because of a federal tax lien. The criteria for subordination are outlined in Internal Revenue Code section 6323(b), which states that the IRS may subordinate its lien if it is in the government’s best interest to do so. Taxpayers should be prepared to provide proper documentation to support their application for subordination. If the application is approved, the IRS will issue a certificate of subordination, which will be recorded in the county where the property is located.