The two ways your home can be seized and sold in a tax sale. This
article gives information on both scenarios and what your rights are in
each.
Most people are familiar with what a foreclosure is, especially in a
hard hit housing market where most homeowners probably came close to
losing their homes to the bank. A tax sale is in the same ballpark as a
foreclosure only it’s not the bank that is taking the property owner’s
home to settle a back debt but the government. There are two different
ways the government can come after and seize your property for a tax
sale. The local county government and the IRS can both use this method
to get back taxes out of you and if you don’t have it, the house can be
seized and sold to pay the bill.
The good news-the IRS is probably not very likely to come after your
house if its your primary residence and you owe back taxes for a few
reasons. First the IRS doesn’t want the bad publicity these seizures
generate and secondly the taxpayers are protected from the IRS seizing
their homes in the Taxpayers Bill of Rights. That doesn’t mean they
can’t do it, it just means due process has to occur first. What that
boils down to is the IRS has to take you to court and get a court order
and you have a right to contest the action. However if you hope to win
this battle you will have to show the judge you are attempting to
cooperate with the government to pay your back taxes. Throwing away
their letters and ignoring their phone calls may push it to the last
resort- seizing your home.
Another way the government may end up seizing your home or land is if
you owe back property taxes. When a tax payer fails to pay the property
tax due on their home, the local county government can begin the
procedure to seize the home to settle the outstanding tax lien. Usually
homes that are seized for back taxes are pretty far behind the eight
ball, so the amount owed compared to the value of the house may be small
but it may be more than the home owner can come up with. Most of the
time the government will let a home go one to two years before they make
this drastic move to take a home to auction and the home owner has a
period of time where they can still come up with the back amount owed
including fines and interest and save their home.
Once this period of time has passed however the home will be put up for
public tax sale auction on the steps of the courthouse and your home
will be sold to the highest bidder, likely site unseen if you are still
living in it. These sales appeal to investors who figure on buying low
and dumping money into the home to make it saleable at a higher price
down the road.
While the prospect of losing your home to a tax sale may seem
daunting, there is a wealth of information out there for you to properly
arm yourself with knowledge of rights and basic procedures. Find out
more at http://www.civicsource.com.
