Is the IRS Required to File a Notice of Federal Tax Lien (NFTL)?
It is clear that Internal Revenue Manual (IRM) Section 126.96.36.199 (Oct. 30, 2009) lists circumstances under which an “NFTL filing determination must be made“, not circumstances under which a Notice of Federal Tax Lien (NFTL) must be filed. Thus, pursuant to IRM Section 188.8.131.52, an IRS Appeals officer is required to make a lien filing “determination” in a Collection Due Process (CDP) Hearing; but the IRS Appeals officer is not required, by that IRM provision, to determine that a Federal Notice of Federal Tax Lien (NFTL) be filed (Budish v. Commissioner, 2014 T.C. Memo 239).
Also, IRM Section 184.108.40.206.2 (Oct. 30, 2009) states, in paragraph #4, that “[a] decision may be made to defer the filing of a[n] NFTL when the revenue officer can document a reasonable certainty that filing the NFTL will hamper collection.“
“There is no reason to assume that the quoted language does not apply to Appeals officers as well as to revenue officers, i.e., we assume that it applies to all IRS personnel required to determine the need to file a notice of lien” (Budish – Footnote #6).