Texas Tax Foreclosure Rules
Texas residents may be subject to more than 60 types of taxes, but residents do not pay income taxes on their earnings. Texas is a state that does not collect income taxes from residents. When residents fail to pay their property tax bills, inheritance taxes or any other taxes they may be responsible for paying, the Comptroller or local tax assessors may file tax liens on their real property.
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Collections Process
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The Texas Comptroller's Office administers the state's 60-plus taxes and is responsible for collecting those taxes. Each year, the Comptroller sends residents tax bills when they fail to report their business taxes or pay their property taxes. Residents have 60 days to pay all of the past due taxes, interest and penalties. After the 60-day window, the Comptroller begins collections proceedings by transferring the delinquency case to a third-party collection agency. Local tax assessors are responsible for collecting property taxes from county or city residents. The Texas Comptroller's Office and local government tax authorities can file liens against a delinquent taxpayer's personal property, real property, file levies and pursue criminal prosecution. Local government tax assessors sell their seized properties during public auctions to satisfy tax delinquencies.
Tax Sales
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Texas tax sales occur only on the first Tuesday of any month at the county courthouse where the delinquent taxpayer's property is located. The Texas Tax Code requires county commissioners advertise each property available for auction within approved local publications. The Texas Tax Code requires counties with over 250,000 residents to follow the statutory requirements for certification from purchasers of tax sale properties.
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Mandatory Certification
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Under Texas law, counties with over 250,000 residents must require tax sale purchasers to provide a certification statement. The tax assessor's office issues the individual certification to purchasers stating the purchaser does not owe the county past-due taxes. In each county, sheriffs and constables are responsible for verifying the purchaser produces this written certification letter prior to delivering a deed to the winning bidder.
Auction Process
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Texas tax foreclosure auctions begin with minimum bids predetermined by the auctioneer. The winning bidder is responsible for paying all delinquent taxes on the taxpayer's behalf, attorney's fees, court fees, title search fees, penalties, interest and associated auction fees. The winning bidder obtains a Constable's Deed or Sheriff's Deed within a few weeks. Under Texas law, delinquent taxpayers may have a right of redemption for up to two years for homestead property and six months for all other property. The right of redemption provides delinquent taxpayers with a right to repurchase their homes by paying the new owner interest and fees.
Considerations
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Since tax laws can frequently change, you should not use this information as a substitute for legal or tax advice. Seek advice through a certified accountant or tax attorney licensed to practice law in your jurisdiction.
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References
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- Photo Credit Auction image by Attila Toro from Fotolia.com
