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Published:   |   Last Updated: September 12, 2023

Letter 3177

Special Condition Notice of Federal Tax Lien Filing – Third Party

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Letter Overview

The IRS has You have been identified you as a nominee or alter ego of athe taxpayer named in the letter who owes a tax balance.

The IRS has filed a Notice of Federal Tax Lien (NFTL) for the unpaid balances located on the Form 668(Y)(c) enclosed with the letter.  

While NFTLs no longer appear on credit reports, they may still affect your ability to get credit if a potential creditor uses other resources, such as public records, to discover the NFTL. 

This notice or letter may include additional topics that have not yet been covered here. Please check back frequently for updates.

What does this mean to me?

The balance must be paid immediately to stop other collection actions. The NFTL is a public record that can affect you and your property and assets. 

How did I get here?

You have been identified by the IRS as a nominee or alter ego of thea taxpayer named in the Letter 3177 who has a balance owed to the IRS. When the IRS isn’t paid, they can file a public document, an NFTL, with local and/or state authorities.  

When the IRS files this special NFTL, it alerts creditors you are associated with the named taxpayer who owes the government. The NFTL secures the priority of the government’s claim to the property specified on the notice, if none is specified, then all the property of the named taxpayer that is being held in your name is secured by the lien.

What are my next steps?

Pay the amount that is owed, including penalty and interest to stop additional collection actions.  

The IRS will issue a Certificate of Lien Release 30 days after either: 

  • The full amount, including penalties and interest, is paid;, 
  • IRS accepts a bond guaranteeing payment of the amount owed;, 
  • IRS determines the liability is not owed, or the liability has been reduced to zero;, or 
  • the IRS is no longer legally able to collect the tax. 


If you disagree with the filing of this Notice of Federal Tax Lien you can request a conference with the IRS Independent Office of Appeals using a Form 9423, Collection Appeal Request. See Publication 1660, Collection Appeal Rights, for a full explanation of the CAP process.through the Collection Appeals ProgramCollection Appeals Program.  If you disagree with the decision to file the NFTL, you can contact the phone number located on the letter and request to a manager’s conference.  If the manager sustains the decision, you can  submitted a request for Appeals consideration verbally, in writing, or via Form 9423 to the IRS employee within three business days of meeting.

Other ways to resolve this issue are: 

  • Request a Certificate of Discharge using Publication 783, How to Apply for a Certificate of Discharge of Property from Federal Tax Lien.
  • Request a Withdrawal of the Filed Notice of Federal Tax Lien using Form 12277, Application for Withdrawal of Filed Form 668(Y). 

Where can I get additional help?

Understanding your notice or letter

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If you still need help

The Taxpayer Advocate Service is an independent organization within the IRS that helps taxpayers and protects taxpayers’ rights. We can offer you help if your tax problem is causing a financial difficulty, you’ve tried and been unable to resolve your issue with the IRS, or you believe an IRS system, process, or procedure just isn’t working as it should. If you qualify for our assistance, which is always free, we will do everything possible to help you.

Visit www.taxpayeradvocate.irs.gov or call 1-877-777-4778.

Low Income Taxpayer Clinics (LITCs) are independent from the IRS and TAS. LITCs represent individuals whose income is below a certain level and who need to resolve tax problems with the IRS. LITCs can represent taxpayers in audits, appeals, and tax collection disputes before the IRS and in court. In addition, LITCs can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Services are offered for free or a small fee. For more information or to find an LITC near you, see the LITC page on the TAS website or Publication 4134, Low Income Taxpayer Clinic List.

Related Letters & Forms

  • Form 668 (Y)(C), Notice of Federal Tax Lien
  • Letter 3886, Special Condition Notice of Federal Tax Lien – Taxpayer 

Where am I in the tax system?

Special Condition Notice of Federal Tax Lien Filing – Third Party , Letter 3177