What Is A Tax Foreclosure Sale?The IRS has a system for dealing with tax liens. The first thing the government will do is send you a bill. They will keep sending your bills for a set amount. The amount of time that the bill is in collections it depends on the state the property is in. Each state has different laws pertaining to taxes and collection of tax issues. The IRS will keep trying different steps to keep the homes from going into a Tax Foreclosure Sale. The steps they follow are several layers of billing, title liens, and then tax foreclosure sales. When the IRS puts a lien on your property it means that you owe them any amount of money. Once that money is paid they will take that lien off of your property. However, if you do not pay the lien in an appropriate amount of time the next phase of the IRS securing your assets begins. The next phase is a Tax Foreclosure Sale. A Tax Foreclosure Sale is where the government sells the lien that they have on your property to an outsourced buyer. The buyer then can go after you for the money that you owe the IRS. IRS Lien vs Tax Deed Sales Most of the divisions of the IRS will work with a taxpayer to arrange monthly payments. If those monthly payments become late or delinquent, then it is the IRS that has to see that you pay them. So they start the escalate of all of these steps to ensure prompt payment. Most people think that Tax Foreclosure Sale means the government seizes your property and then sells on it. This is a common misconception. The government cannot sell your property out from underneath you unless you have so much tax debt that there is no other way to obtain the funds that you owe the government. State and County tax rules are different and can result in a tax deed sale where you lose your home in an auction. When you owe the government money it is best to arrange a payment method with them. If you avoid them it is tax evasion. Tax evasion is punishable by cash penalties as well as jail time. Make sure when you complete your payment schedule for your property taxes that you save your receipts for up to 10 years. That secures proof for your records that you paid all that you are liable for. |