Paying property taxes in Florida helps the state to generate revenue for public purposes, like schools, roads, parks, and police. So if you fail to pay your property taxes, then this means you have a debt owed against the government and this can affect your rights to your property ownership.
Of course, there are times when you can’t make your property tax payments. If this is the case, then you may end up owing the government or have a lien against your house. No doubt, you may be wondering how you can still sell your property even if you have property taxes owed.
This blog can help Florida homeowners understand what it takes to sell a house in Florida even with back taxes owed.
How Do Delinquent Property Tax and Liens Affect Your Property Sale?
When a homeowner fails to pay property taxes on a given parcel of land or home, the taxes accrue (with accrued interest) and must be paid to convey “clear title” in the event of a sale. If the amount is substantial enough, or the time frame significant enough the government may place a lien against the property, or in the worst-case scenario… seize the property outright from an owner.
There are many reasons someone might fall behind on their tax payments:
- Missed payments
- Unexpected events
- Health issues
- Job loss
- Upside down or negative equity
In general, when you don’t pay your property tax by the date your tax bill is due, you can start to accrue a tax penalty. This can amount to as much as a 6% penalty and 1% interest on the past due amount. The penalty and interest will continue monthly, amounting to a substantial tax collector fee.
How Long Do You Have to Pay Property Taxes in Florida?
In the state of Florida, in general, you can pay your property taxes up to 60 or up to 120 days late without penalty. However, this time period can vary depending on your taxing authority and the local market conditions at the time you go delinquent.
Taxes are due on November 1st of each year (or as soon as the tax collector receives the tax certified tax roll. Your taxes are considered delinquent if they are not paid by April 1 the following year or 60 days after the mailing of the original tax notice, whichever is later.
Can Someone Take Your Property By Paying the Taxes in Florida?
Unfortunately, your property can be taken away if you have unpaid taxes on said property. When you don’t pay your taxes, a tax lien is put against your property. The state can sell the lien if you don’t pay and then the party can foreclose on the house or sell it in a tax sale to get the title.
If you have a tax lien against your property, the government can step in and foreclose against your house. If you get to this point, it is better to sell your house with the back taxes on it to an investor like us at Freedom Home Buyers. We can close the sale fast and clear your debt with the city and county, rather than let the property be seized and sent to a public auction.
What Happens if You Pay Someone Else’s Property Taxes in Florida?
There is the chance that someone else will pay your unpaid property tax. This usually happens when the delinquent tax goes into a tax lien. At this point, you can ask a real estate investor like Freedom Home Buyers to pay the tax liens and avoid selling it off at auction. This is common practice for us, as we buy houses in Jacksonville fast, and frequently.
Other investors pay off the loan and could release the property back to you. However, sometimes the property can be taken from you as well. You don’t want to wait until it gets to this stage!
Selling Real Estate With Back Taxes Owed
If your house has back taxes on it and you want to sell, then you need to get rid of the back taxes (also called a lien) before you can make the sale. A “tax lien” is a claim the government makes against your property if you neglect to pay, or are delinquent on taxes you owe to the IRS. This is a first-priority lien so it takes precedence over the mortgage. These can be income taxes, property gains tax, property taxes, or other dues you owe.
The property tax lien only exists after the federal government assesses your liability (or the records of your overdue balance), and then sends you a Notice and Demand for Payment, which is essentially the bill that tells you how much you owe.
According to the IRS, you must pay the delinquent lien amount before you sell or refinance your home. The lien can be paid in part or full by the equity you have in your property, or out of the sales proceeds you receive at the closing.
Sometimes the price of the house plus the lien is more than your sale. Luckily, the government has systems in place to help homeowners who are struggling. The IRS says you as the taxpayer can request them to discharge the amount you owe to allow the sale to be completed.
If you fall behind on your property taxes, you can sell your house before or after the county places a lien against it and before it forecloses. However, no matter what, when you find a buyer, the taxes must be current at closing. If they aren’t, you can’t transfer the title.
Since you can pay the delinquent taxes you owe from the proceeds of the sale before the close of escrow, this allows you to pass a clear title. You can also negotiate with the buyers for them to pay any back taxes. Although you can make it a condition of sale, you must clearly stipulate in the real estate purchase contract who is responsible for paying the delinquent taxes.
How to Get Out of Your Tax Lien
Even if you owe property tax or have a tax lien against your home, you can get out of the delinquency and sell your home before it goes to a tax sale. The worst thing a homeowner can do is nothing at all and let the government come and take your home away with no compensation at all.
We will work with you to get your house sold and your debt cleared. We will even help you out by:
- Paying the back taxes
- Paying the closing costs
- Qualifying you for our “Freedom Move Program”
- Buying your home in as-is condition
Freedom Home Buyers often help homeowners who need to sell a house with back taxes. We purchase homes with taxes owed or liens against the personal property you live in, or even if you need to sell a rental property with an existing tenant, or a vacant home.
A skilled and seasoned real estate investment company, like Freedom Home Buyers, is familiar with the process of purchasing property with liens and back taxes. We work with our partners at the title company to make sure all debts on the property are correctly paid and YOU, as the homeowner, are free of the burden and financial responsibility. We make sure that you get the maximum amount possible from the property at the closing table and can get on with your life. We make it easy to sell a house with back taxes.
Selling Your Jacksonville Home Even With Property Tax Owed
At Freedom Home Buyers, we understand that sometimes a property owner finds themself in a bad situation and cannot pay the property tax or has a tax lien against the house. But don’t worry – we can help!
We are a real estate investment company that will pay cash to get you out of your tax lien and close your house fast. This will help you save money compared to the traditional cost to sell a home.
We buy homes in any condition and quickly, so you don’t have to deal with realtors and prepare your home. Reach out today for your free, no-obligation cash offer.