We purchased a foreclosed home with cash in the fall of 2008. The seller (a large bank) paid all of the closing fees including title charges and we received a Limited Warranty Deed at closing from the Title company. In January, we were contacted by the IRS regarding a substantial tax lien against this property dating back to 2004 - which they claim is now our responsibility. IRS records confirm that the attorney representing the seller was informed of this tax lien one month before our closing date, but never acknowledged it. We have asked the Title company for an explanation, but they have not responded to our calls or emails for over a month. Your advice?

Turn it over to your title insurance that you would have purchases ( esp on a foreclosed home)

If not you will have to hire a real estate attorney and attempt to sue the bank, but you at closing was suppose to hire your own attorney to do your own title search. The seller is working for its own interest, not your interest