Legal Question in Landlord & Tenant Law in Virginia

Re: IRS or Landlord rights to assets of a business

The IRS's right to seize and sell a federal tax debtor's property is a special right conferred by Congress and one in which other creditors cannot share. The federal tax debt allows the IRS to assert a summary type lien against the tax debtor's property and to enforce the lien through the seizure and sale of the debtor's property.

You as persons with, apparently, mere unsecured creditor status, are reduced to availing yourselves of the standard remedies which are traditionally available to creditors who are owed money.

Re: IRS or Landlord rights to assets of a business

I believe the spoils will go to the swift.

I agree with Mr. Henderson that if you both show up in court at the same time, the IRS will have

first priority.

However, if you are in and out before they get around to it, then I think you will be entitled

to sell the assets left in your premises in

satisfifaction of rent, assuming you comply with

all the formalities (like first asking for the

rent, giving appropriate notice, etc.)

Also make sure that you are seizing and selling

property that does not have loans on it, like

financed equipment.

Also, if the tenant eventually files for bankruptcy, the bankruptcy court might have the

authority to yank back what you received and

to distribute funds equally among various creditors.

I think that as the landlord, with a statutory

right (I THINK, you'd better have an attorney

double check your situation) to sell the property in payment of rent, you would stand a

little bit higher than a "mere" unsecured creditor, and would have some priority over other creditors. But not over the IRS.