Generally all liens that are junior to (dated after the loan in question  and no subordination) are wiped out at sale. Property taxes are always senior, and IRS liens have a 120 day right of redemption.

That said I've heard that there is some case law that says a mechancis lien may stand IF the work was necessary to protect the asset. I'd imagine this to mean repairs after a storm, or a water pipe breaking, and NOT something like new carpet.

USFN tends to be a great resource for keeping up to date on the latest legal issues around trustee sales. I've purchased some of the publications and guides and get their e-update which I find very useful on these topics.

Interesting. What is tracking mechanism for the "mechanics lien qualified repairs" to be recorded and later tracked?

The mortgage holder can usually initiate foreclosure at a time specified in the mortgage documents, typically some period of time after a default condition occurs. Within the United States and many other countries, several types of foreclosure exist.