diff --git a/contractcourt/htlc_timeout_resolver.go b/contractcourt/htlc_timeout_resolver.go
index 62ff832071..ee1b269586 100644
--- a/contractcourt/htlc_timeout_resolver.go
+++ b/contractcourt/htlc_timeout_resolver.go
@@ -562,6 +562,59 @@ func (h *htlcTimeoutResolver) sendSecondLevelTxLegacy() error {
 	return h.Checkpoint(h)
 }
 
+// sweepDirectHtlcOutput sends the direct spend of the HTLC output to the
+// sweeper. This is used when the remote party goes on chain, and we're able to
+// sweep an HTLC we offered after a timeout. Only the CLTV encumbered outputs
+// are resolved via this path.
+func (h *htlcTimeoutResolver) sweepDirectHtlcOutput(immediate bool) error {
+	var htlcWitnessType input.StandardWitnessType
+	if h.isTaproot() {
+		htlcWitnessType = input.TaprootHtlcOfferedRemoteTimeout
+	} else {
+		htlcWitnessType = input.HtlcOfferedRemoteTimeout
+	}
+
+	sweepInput := input.NewCsvInputWithCltv(
+		&h.htlcResolution.ClaimOutpoint, htlcWitnessType,
+		&h.htlcResolution.SweepSignDesc, h.broadcastHeight,
+		h.htlcResolution.CsvDelay, h.htlcResolution.Expiry,
+	)
+
+	// Calculate the budget.
+	//
+	// TODO(yy): the budget is twice the output's value, which is needed as
+	// we don't force sweep the output now. To prevent cascading force
+	// closes, we use all its output value plus a wallet input as the
+	// budget. This is a temporary solution until we can optionally cancel
+	// the incoming HTLC, more details in,
+	// - https://github.com/lightningnetwork/lnd/issues/7969
+	budget := calculateBudget(
+		btcutil.Amount(sweepInput.SignDesc().Output.Value), 2, 0,
+	)
+
+	log.Infof("%T(%x): offering offered remote timeout HTLC output to "+
+		"sweeper with deadline %v and budget=%v at height=%v",
+		h, h.htlc.RHash[:], h.incomingHTLCExpiryHeight, budget,
+		h.broadcastHeight)
+
+	_, err := h.Sweeper.SweepInput(
+		sweepInput,
+		sweep.Params{
+			Budget: budget,
+
+			// This is an outgoing HTLC, so we want to make sure
+			// that we sweep it before the incoming HTLC expires.
+			DeadlineHeight: h.incomingHTLCExpiryHeight,
+			Immediate:      immediate,
+		},
+	)
+	if err != nil {
+		return err
+	}
+
+	return nil
+}
+
 // spendHtlcOutput handles the initial spend of an HTLC output via the timeout
 // clause. If this is our local commitment, the second-level timeout TX will be
 // used to spend the output into the next stage. If this is the remote
@@ -582,6 +635,16 @@ func (h *htlcTimeoutResolver) spendHtlcOutput(
 			return nil, err
 		}
 
+	// If this is an anchor, and there's no second level txn (direct spend
+	// from remote commitment), then we'll just send this directly to the
+	// sweeper.
+	case h.isTaproot() && h.htlcResolution.SignedTimeoutTx == nil:
+		if err := h.sweepDirectHtlcOutput(immediate); err != nil {
+			log.Errorf("Sending direct spend to sweeper: %v", err)
+
+			return nil, err
+		}
+
 	// If we have no SignDetails, and we haven't already sent the output to
 	// the utxo nursery, then we'll do so now.
 	case h.htlcResolution.SignDetails == nil && !h.outputIncubating:
@@ -763,6 +826,7 @@ func (h *htlcTimeoutResolver) handleCommitSpend(
 			h.htlcResolution.CsvDelay,
 			uint32(commitSpend.SpendingHeight), h.htlc.RHash,
 		)
+
 		// Calculate the budget for this sweep.
 		budget := calculateBudget(
 			btcutil.Amount(inp.SignDesc().Output.Value),
@@ -794,6 +858,12 @@ func (h *htlcTimeoutResolver) handleCommitSpend(
 		claimOutpoint = *op
 		fallthrough
 
+	// If we swept an HTLC directly off the remote party's commitment
+	// transaction, then we'll fall through as we just need to wait until
+	// the sweep has been confirmed.
+	case h.htlcResolution.SignedTimeoutTx == nil:
+		fallthrough
+
 	// Finally, if this was an output on our commitment transaction, we'll
 	// wait for the second-level HTLC output to be spent, and for that
 	// transaction itself to confirm.