§6324A Special lien for estate tax deferred under section 6166

Summary

When an estate delays paying estate tax under section 6166, the executor can choose to put a federal lien on certain estate property if they follow the rules and sign a written agreement. The lien covers the deferred tax amount plus any interest, penalties, additions, and costs tied to that deferred amount. The property covered must be things expected to last through the delay and must be named in the agreement. The IRS can ask that the value of that property not be more than the deferred tax plus the interest due for the first 4 years. If the named property is worth less, the IRS may accept a bond for the shortfall. The agreement must be signed by everyone who has an interest in the named property and must name a responsible person to act for beneficiaries and those who signed when dealing with the IRS. The lien starts when the executor is released from liability under section 2204 or when the IRS files the required notice under section 6323(f), and it lasts until the debt is paid or becomes unenforceable. The lien is not effective against buyers or other lienholders until that notice is filed, and some other claims (like certain mechanic’s liens and specific security interests) can take priority as described in the law. If the property falls below the needed value, the IRS can demand more property or security; if not provided within 90 days, the payment schedule may be accelerated. The IRS cannot require a bond under section 6165 for taxes covered by such an agreement. Deferred amount — total tax deferred under section 6166 as of the payment due date. Required interest amount — interest due over the first 4 years of the deferral, measured as of the same date. Deferral period — the time the tax payment is delayed under the 6166 election. If there is a deficiency, separate deferred and interest amounts and a deferral period are set when the first installment after the deficiency is due.