IRS Form 668(Z): Certificate of Release of Federal Tax Lien

Form 668(Z), Certificate of Release of Federal Tax Lien, is the counterpart to Form 668(Y). Where Form 668(Y) files a lien, Form 668(Z) releases it. When the underlying tax liability is satisfied, becomes legally unenforceable (such as expiration of the Collection Statute Expiration Date), or is otherwise discharged, the IRS is required by IRC Section 6325(a) to issue Form 668(Z) within 30 days.

How to Verify the Release

After Form 668(Z) is issued, confirm that the IRS filed it with every recording office that received the original Form 668(Y). The IRS normally handles the filing through the Centralized Lien Operation, but copies get lost. If your lien was recorded in multiple counties or states, verify each one. Pull a current credit report after 60 days to confirm the release flowed through to the credit bureaus.

A taxpayer who prefers to file the release personally may request Form 668(Z) and present it to the recording office themselves. This is sometimes faster than waiting for the IRS to complete its own filing. The release still has to be requested from the IRS first, and the Centralized Lien Operation must update its records whether or not the taxpayer handles filing.

Partial Releases and Erroneous Releases

Form 668(Z) can also be issued with modifications for less common situations. A "Partial Release" releases the lien as to one spouse on a joint liability while leaving it in place as to the other. A "Release of Erroneous NFTL" is issued under IRC Section 6326 when the original lien should not have been filed at all. A "Partial Release of Erroneous NFTL" combines both scenarios. The modifications are typed on the standard form, and the specifics are set out in IRM 5.12.3.

The Credit Report Aftermath

A released lien no longer appears on credit reports in most situations. The three major credit bureaus removed tax liens from consumer credit reports in 2018 and 2019. Older business credit reports and certain public-records databases may still carry the released lien. If the release is not reflected in a specific report that matters to you, send that reporting agency a copy of Form 668(Z) with a dispute letter.

If your lien was released but the public record or credit file is not catching up, call us at (813) 229-7100. Cleanup after release is often where the real work happens.