Should I pay the property taxes on an inherited house? Hey guys, it’s Brad from ProbateResource.com. So at Probate Resource, we’re a real estate solutions company specializing in the world of probate and inheritance properties. We buy properties for cash or we have a handpicked network of real estate agents all throughout the country that are probate and inheritance specialists that we can refer you to. So today I want to talk about paying property taxes on an inherited house. So maybe you’ve inherited a house or you’re in charge of an estate and there are property taxes owed. In most cases, in most places in the country, if you do not pay the property taxes, the property will be sold at either a tax lien auction or a tax deed auction, because the county needs their property taxes. Now, how soon that happens really depends on your area, and in many cases it also actually depends on who the property tax commissioner is at the time.
For instance, in my specific county that I live in, there was a period of time a few years ago with our old tax commissioner where they did not do any tax sales for a number of years, and then a new tax commissioner came into office and decided, “Hey, there’s a lot of taxes owed here. Let’s do some tax sales.” And they decided to do tax sales. So I saw properties that had five, six, seven, eight years of no tax sales even though they owed delinquent taxes for many, many years. So just because the tax commissioner can do a tax sale doesn’t mean they necessarily always do a tax sale. So you need to make sure that you are paying the property taxes on this particular property, because if you don’t and the taxes get delinquent, it could get sold at a tax sale auction. And depending on the state that you’re in, sometimes you have a period of time where you could redeem that tax sale. Basically, you typically have to pay the amount plus penalties and interest.
And depending on the state you live in, there may not be a right, it’s called a right to redemption period. There may not be a right to redemption period. Plus some areas have what’s, let’s call it a graduated right to redemption period. So within the first year, you owe X amount of interest on top of it, and the second year you X amount more of interest. You do have a longer period of time to redeem, but the penalty to redeem is a little bit higher. But you still do have an opportunity to redeem and take your property back, even though you never really 100% lost it during the redemption period. As long as you pay the redemption amount, you can get it back and the investor that bid on the property can actually get their money back plus a little bit of interest on their money.
So make sure that your property taxes are getting paid. If you’re not sure whether you owe property taxes or not, you can go check at your local county tax commissioner’s office and you can usually do a, most of them are all online nowadays. You can do a search for your property address or the owner’s name, and it will tell you if there’s any outstanding tax bills. In a lot of cases, if there’s a mortgage on the property, and this isn’t in all cases, but in many cases if there’s a mortgage, a lot of times the mortgage company is escrowing the taxes and they are paying the tax bill every year out of the escrow account. And why do they do that? Well, they don’t want this property to get lost at a tax auction, because tax liens are always senior to all other liens on the property. So there could be instances where their mortgage lien could get wiped from a property in some scenarios and they would lose all their money.
It is in the mortgage company’s best interest to escrow the taxes to make sure that they know the property taxes are getting paid every year on the property so that it doesn’t get lost in tax auction. So like I said, go to your tax commissioner’s office. You can usually do a search and you can see whether there’s an outstanding tax balance owed. You can also contact them and ask them if there is an upcoming tax auction or if this property’s on the tax auction, they’re going to notify you too. They’re going to typically publish that out in public records. Usually it’s a local newspaper or they pick one of the newspapers and they’re going to advertise that out to the public that your property is going to be put up for tax auction. And you’ll probably also get notifications in the mail, letters in the mail, that sort of thing. So make sure you’re checking the mailbox for that.
If there is a tax amount owed, and maybe at the time the estate doesn’t have any money to pay the taxes, but ultimately they’re going to sell the house. So there’ll be money to pay the taxes then, and you’re worried about losing it. In some cases, you as the executor or even the family members or whomever can pitch together and basically pay those taxes on behalf of the estate. Just make sure you sign some paperwork that basically says that the estate owes you that money back. We’ve seen that in some cases where maybe the executor or the estate doesn’t have any money in the account, but they are going to be selling the property and maybe there’s no mortgage owed on the property. So the estate’s going to get all the proceeds back when it goes to sale, but there are taxes owed. We’ve seen cases where the executor or the administrator has paid the taxes out of their own pocket just to make sure that the taxes are paid and nothing’s lost in a tax auction.
And then once money does come into the estate account, they do a reimbursement back to themselves and they have a proper paper trail. And you should consult your probate attorney how you would do that properly or if you’re doing it yourself, there’s some online resources out there just to make sure that you have the paper trail in place, but you can absolutely pay it and then reimburse yourself back from the estate account. But again, like I said, make sure your paperwork’s in order and you’re doing it properly. Make sure the taxes are getting paid. All right. Well, I hope this helps you out. This is Brad from ProbateResource.com. Like I mentioned, we’re a real estate solutions company specializing in probate and inheritance properties. We buy houses all over the country. We pay cash, we make it fast and easy. And we also, if you feel like maybe you want to go the traditional route, you want to list that house with an agent, get top dollar for it, maybe you got a really nice house and a really nice neighborhood and you’d rather go that route.
We actually have a handpicked network of real estate agents all over the country that are probate and inheritance specialists that we work with, and we’d be happy to refer you onto one of those agents in your specific market. So if you’re interested in working with Probate Resource, go to ProbateResource.com or you can click on the link below in the description, it’ll take you to our website. There is a form there on our website that you can fill out, and a member of our team will be back with you ASAP, or you can pick up the phone and call the phone number there on our website and you’ll get a member of our team there, be happy to discuss your situation and figure out what the best fit for you might be. So thanks for watching this video today. I’m Brad from ProbateResource.com. Have a nice day. Bye-bye.
Should I pay the property taxes on an inherited house?
It’s Brad from ProbateResource.com. We are a real estate solutions company that specializes in probate and inheritance properties. We can either buy properties for cash or refer you to one of our trusted real estate agents from our handpicked network of probate and inheritance specialists across the country.
Today, I want to talk about the process of paying property taxes on an inherited house. If you have inherited a house or are in charge of an estate, and there are property taxes owed, you must pay them to avoid the property being sold at a tax lien or a tax deed auction. The time frame for this sale to happen depends on the area you are in and, in some cases, on the property tax commissioner. It is crucial to pay the property taxes on time to avoid any legal issues.
Tax Sales
It’s important to note that just because a tax commissioner has the power to do a tax sale, it doesn’t mean they always do. For example, in my county a few years ago, the previous tax commissioner did not hold any tax sales for several years. However, when a new tax commissioner came into office, they decided to hold tax sales for properties that had not paid their delinquent taxes for many years. This means that you must ensure that you are paying your property taxes on time as if they become delinquent, your property could be sold at a tax sale auction. Depending on the state you’re in, you may have a chance to redeem the tax sale by paying the amount owed, plus penalties and interest.
Redemption Period
Depending on the state you reside in, there may not be a right to redemption period. This period is essentially an opportunity for you to reclaim your property after it has been foreclosed.
However, some areas may have a GRADUATED RIGHT TO REDEMPTION PERIOD where you owe a certain amount of interest on top of the redemption amount, which increases with each passing year. Though the penalty to redeem may be higher, you still have a longer period to redeem your property. As long as you pay the redemption amount, you can get your property back, and the investor who bid on the property can also get their money back, along with a little bit of interest. So, you never really 100% lose your property during the redemption period.
It’s important to ensure that your property taxes are paid on time. If you’re unsure whether you owe any property taxes, you can visit your local county tax commissioner’s office or search online using your property address or owner’s name. In many cases, if there’s a mortgage on the property, the mortgage company may escrow the taxes and pay the tax bill every year from the escrow account. This is because tax liens take priority over other liens on the property, and the mortgage company doesn’t want to risk losing their investment in case the property is lost at a tax auction.
Property Taxes
It is important for mortgage companies to escrow property taxes to ensure that they are paid on time and the property doesn’t end up being sold at a tax auction. To check if there is any outstanding tax balance owed, you can visit your tax commissioner’s office and do a search. You can also contact them and inquire about any upcoming tax auctions or if your property is listed for tax auction. The information is typically published in local newspapers or other public records, and you may also receive notifications in the mail. So, it is important to check your mailbox regularly.
If the estate owes taxes but doesn’t have the money to pay them, there is still a way out. If the estate is going to sell a house, the proceeds from the sale can be used to pay the taxes. However, if you’re worried about losing the property due to the taxes owed, you can pay the taxes on behalf of the estate. As the executor or a family member, you can contribute to paying the taxes, but make sure to sign a document that says the estate owes you that money. This is necessary because in some cases the executor or the estate might not have any money in the account to pay the taxes, but they will eventually get the money back when the property is sold. Therefore, it is important to ensure that the taxes are paid on time to avoid losing the property through a tax auction.
Once the money comes into the estate account, the beneficiaries can reimburse themselves and keep a proper paper trail. It’s important to consult a probate attorney to ensure that this is done properly. If you’re doing it yourself, there are online resources available to help you create a paper trail. Be sure to keep all paperwork in order and pay any necessary taxes.
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I hope this information helps. I’m Brad from ProbateResource.com, a real estate solutions company that specializes in probate and inheritance properties. We buy houses all over the country and pay cash quickly. If you prefer to list your house with an agent and get top dollar for it, we can help with that too. We have a handpicked network of real estate agents across the country who specialize in probate and inheritance matters. We can refer you to one of those agents in your particular market.