How Long Can You Go Without Paying Property Taxes?
“In this world,” to quote Benjamin Franklin, “Nothing can be said to be certain except death and taxes.” If you’re a homeowner, you know that statement to ring true more than others. Your mortgage payment each month, for example, comprises of the payment, interest, taxes and insurance (P.I.T.I.).
Sometimes your property taxes are paid separate. And in some cases property tax rates may have increased in your area forcing your mortgage payment to go up. Your escrow balance might be lacking funds. And if you’re in a financial rut, in foreclosure, or in a situation where you cannot pay the extra property tax, what do you do? You might be wondering how long can you go without payment property taxes in Utah before you ultimately lose your property with everything on it including your home?
Unfortunately, it’s not just missing a mortgage payment which can result in losing your home & property. You could also lose your home if you don’t pay your property tax due each year regardless if you have a home on the land or not. So, how long can you go without paying property taxes is an important question.
When property tax is not paid a lien can be placed on the home by filing certain paper work with the county. A recent survey found that property taxes levied on single family homes in 2017 amounted to over $293 Billion; an increase of 6 percent from the previous year. That’s an average of $3,399 per home. By comparison, the average annual property tax on a home priced at state median value in Utah is only $1,576.
How Long Can Property Taxes Go Unpaid in Utah?
In Utah, the Property Tax Redemption Period ends March 15 of the current year for taxes five years late. Any late property tax payment received before March 15 of the current year will be applied to the most current tax year first. Once any property tax becomes five years late as of that date, each year owed must be paid in order to stop a property tax sale; which in Utah occurs the fourth Thursday of May.
Lets assume you owe property taxes on your Salt Lake City home for 2014, 2015, 2016, 2017 and 2018. Any payment you make by March 15th of the current year will be applied to 2018 first, then 2017 and so on. So in this example, if you make a property tax payment that is enough for 4 years of property taxes, you will still owe property taxes for 2014. Since 2014 property taxes due is 5 years old, the house will be auctioned off on the 4th Thursday of May each year.
However, the ramifications of not paying property taxes can begin much earlier. And they don’t stop with sales and foreclosure. A state tax lien can be filed against you if no prior arrangements are made with a state or county tax commission for regular payment. Not only will a state tax lien likely prevent you from selling or refinancing property in the near future; but it will also make it next to impossible to acquire credit. Once filed, a lien is entered into public record; even if it’s withdrawn as a result of paying the full balance. That lien will still appear on credit reports (listed as set aside) for up to eight years after—even if the property changes hands.
Wrongful Liens In Utah
For liens placed by a non government entity, there are statutes in place to help protect consumers in cases of wrongful or fraudulent claims. Any lien that is not authorized by a state or federal statute, court order or legally authorizing document is subject to civil penalties including:
- Actual damages caused by the wrongful lien
- Liabilities of anywhere from $10,000 up to three times the actual damages
- Additional attorney and legal fees
By simply contacting your local district county court to remove or nullify the lien, you can file a petition to have it revoked altogether or issued a temporary “ex parte” order preventing further liens for a period of up to three years; even if the original respondent is not present at the hearing .
Keep in mind, this is entirely contingent not only upon providing reasonable evidence that the entity made the wrongful lien and specific reasons why it should be nullified, but primarily only applies to private entities. If the lien was placed by state or county officials, the chances of your petition being granted will likely prove to be extremely low.
What Can I Do To Prevent My Property Being Sold?
The most simple answer is to pay off any current or outstanding fees in full. This includes interest and penalties; the latter of which can be up to 2.5 percent of the original tax by Utah state law.
However, for many of you this may not be a realistic option. Often times, it’s not mere forgetfulness that causes many homeowners to delay paying property tax. It can frequently be a drastic change in lifestyle and employment.
Perhaps you recently experienced a divorce. Or a serious illness in the family. Or simply found yourself in dire financial straits. You’ve tried to keep your head above water as best you can; but between monthly mortgage payments and ever increasing bills, there’s simply not enough left to hand over to the state.
Even if you have years of unpaid property taxes, you can avoid damaging both your credit and your financial stability by selling your home to GaryBuysHouses, your local house buyer, who never gives anyone any hassles. Not only is approval guaranteed, but we typically pay in cash—in many cases, in as little as 3-5 business days. Which, in comparison to the estimated 30-60 days from a traditional home buyer it can take to sell your home in Utah, that goes a long way in relieving both your stress as well as county tax official’s demands. We also have programs which allow you to stay in your house for weeks, months or even years after you sell your house. Our goal is flexibility that serves the house seller the most.
But whether it’s a temporary setback, a drastic financial loss or simply a momentary case of absent mindedness, taxes are—as we indicated early on—inevitable. Just be happy that as opposed to the other inevitability in life, you have a viable and trusted option you can now take advantage of today.
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