Consequences of Unpaid Property Taxes

Your property tax liability remains your responsibility even after you have satisfied your mortgage loan completely. This liability can be extremely difficult to manage for homeowners who still have a mortgage to pay, mainly due to ever-increasing property taxes. However, homeowners should be aware that failing to pay their property taxes in a timely manner can and often does come with serious and often devastating repercussions as a result of those unpaid property taxes.  

Penalties and Fines 

When a homeowner’s property tax liability is neglected for a certain amount of time or the homeowners are found to be delinquent in paying their property taxes, the IRS can apply both late fees and added penalties to the debt, which increase with any time that passes between then and the payment of the debt. If you are found to be delinquent in paying your property taxes, it is in your best interest to handle the matter immediately, as these penalties can grow rapidly. 

Lien on Property 

After a homeowner is found delinquent in their tax liability, he will be given an amount of time by the IRS to satisfy the debt, usually determined by the amount of the debt owed. Failure to satisfy this debt in a timely manner allows the IRS to apply a tax lien against the property, meaning the government can sell that lien to an investment company.

This investment company buys the lien, along with any added interest and penalties, and makes its  own attempt to obtain the debt from the homeowner, usually after applying fees and interest of their own.

If the homeowner fails to relieve the debt from the investment company, the company can then order foreclosure on the property and sell it at any price they wish. This particular type of investment has become extremely popular, as this process usually nets the investment company a very healthy profit. This is especially true because the government can apply a lien on any property in debt, no matter how small. 

What You Can Do 

Your best protection against the seizure of your property is prevention.

• Be aware of your tax liability each year, and pay them in a timely manner.
• If for some reason you don’t receive a bill by mail, you can check with the Court Clerk in your county of residence to obtain any information on your current tax liability and status.

Getting Help

If you are notified that you are indeed delinquent in paying your property taxes, you should consider obtaining a professional attorney immediately.  Your attorney can help you to understand all of your possible options and can help you in dealing with the IRS regarding your unpaid taxes.