Settling Your Property Tax Debt With Debt Relief

In many states, your home can and will be foreclosed on if you do not pay the property taxes. If you have delinquent payment on your dwelling and end up selling, the missed tax payments must still be paid before you can complete the sale. In fact there have been cases of property tax suits filed up to twenty years past the first missed payment. Some of the issues you will encounter in dealing with your property tax situation are tax liens and tax deeds. It is important to know the facts and severity of both, to help get out of your property tax debt.

The Consequences of IRS Liens

Tax Liens are both constitutional and statutory, and are given an automatic priority over the mortgage company's lien.Tax liens are a very severe consequence of property tax debt that involves a complex process aimed at collecting unsettled tax payments for the IRS. The government issues tax liens on properties owned by homeowners who are negligent to their duty of paying their property taxes. Tax lien certificates are sold by the particular county to investors at public tax lien auction sales. After an investor obtains their winning bid on a tax lien certificate, a lien is placed on the property and a certificate is issued to the investor that outlines all of the debt, penalties, and interest that is still to be paid on the property.

Tax Deeds

The alternative method used to collect delinquent taxes is through the sale of tax deeds. Tax deeds, which are similar to tax liens, are sold at government auctions and are won and divied out through competitive bidding amongst investors. Where tax deeds differ from tax liens is they do not come with an attached interest rate because it gives title to the actual property. A tax lien gives title to the tax debt owed on the property. Tax deeds are also bound by a redemption period, which, at termination, gives the legal ownership right to the property. After the redemption period has ended, the tax deed investor can purchase the property for the costs associated with the penalties and interest attached to the property. The tax lien investor, on the other hand, has the option of purchasing the property after the redemption period but for the costs associated with taxes, penalties and interest expense.

For property owners, tax liens and tax deeds are an extremely dangerous consequence of tax debt that can ruin your credit score and finances. Once a tax lien is placed on a homeowner's property, other creditors are given notice of this debtor's inability to meet their property tax obligations which affects your standing with other creditors. This can lead the creditor's to give you loans with increasing interest rates, if you can even get that. It is very important that homeowners practice financial responsibility by fulfilling their property tax obligations and doing their best to stay on good terms with the IRS. You can register right now and find Property Tax Debt Relief and you will sleep better, have a better financial future, and have a greater understanding of the IRS and Tax system for it.

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