Real Estate Tax
Delinquent Property Tax Information
Property taxes become due November 1, and are delinquent if not paid by April 1 of the following year at which time 3% interest and advertising cost are added.
The amount due on delinquent payments is determined by date received, not by postmark. Failure to receive a tax bill on your property will not relieve you from paying taxes or subsequent penalties which are imposed when taxes become delinquent on April 1. Partial payments are not accepted for delinquent taxes.
On or before June 1 the Tax Collector must conduct a tax certificate sale auction on all unpaid property taxes as required by Florida Statutes Chapter 197. Once a tax lien has been issued on your property, you have up to 22 months to pay your taxes before the tax deed foreclosure process can begin. For example, your 2010 taxes are considered due on Nov 1, 2010. If no payment has been made, your taxes are considered delinquent as of April 1, 2011. A tax certificate will be issued on or before June 1, 2011, depending on the sale date for that year. A tax deed foreclosure cannot be initiated on your property until April 1, 2013.
Property taxes become delinquent if not paid by April 1 of the following year. During the month of May, the Tax Collector is required to advertise a listing of all delinquent property taxes in the newspaper and online. On May 26, 2018, the tax collector’s office will conduct an annual Tax Certificate Sale to collect the preceding year’s unpaid taxes and associated fees.
A tax certificate is a first lien created when a third party (tax certificate holder or investor) pays the outstanding delinquent taxes on a property. A tax certificate is an interest bearing “lien” for unpaid real estate and non-ad valorem assessments. They are a first lien against property and supersede governmental liens. Tax certificates convey no property rights.
The tax certificate’s face amount consists of the sum of the following: delinquent real estate tax (unpaid amount), interest (1.5% per month for April and May on the delinquent amount), Tax Collector’s commission (5% on the delinquent amount) and the newspaper’s advertising charge (& sale costs or other costs).
To pay off a tax certificate, the property owner must pay delinquent taxes, accrued interest and advertising costs. Upon redemption, the Tax Collector’s office reimburses the tax certificate holder/investor all monies due.
If the property owner fails to pay delinquent taxes within 22 months from the date tax certificate lien was issued, the tax certificate holder/ investor may file a tax deed application. A tax deed application may result in a Tax Deed Foreclosure.
A tax certificate does not convey any property rights. Purchasing a tax certificate is simply an investment.
Tax Certificate Sale Information
Pursuant to Florida Statute Chapter 197, the Tax Collector must start the tax certificate auction on or before June 1.
Tax certificates convey no property rights. They are an interest bearing “lien”. Prior to the auction, the list of delinquent properties is advertised once a week for three consecutive weeks. Advertising and collection fees are added to the delinquent taxpayer’s bill.
The interest on a tax certificate ranges from 0 to 18%. Valid bids may be entered between 0 and 18% in 0.25% increments. If the tax certificate is redeemed after June 1 the tax certificate holder is guaranteed a minimum of 5% interest. Zero percent bids will not earn the 5% minimum interest. Bids are entered and awarded to the buyer with the lowest interest rate bid. Simple interest accrues on a monthly basis. If the tax certificate earns an interest rate of 12%, then interest will accrue at the rate of 1% per month until the tax certificate is redeemed.
If there are any delinquent properties that do not receive a bid, those tax certificates are issued to the county at 18%. These county held tax certificates will become available for purchase at a date to be determined by the Tax Collector.
The life of a tax certificate is 7 years. In the event of a bankruptcy filing, the life of a tax certificate may be extended. If no action is taken by the tax certificate holder during the 7 year period, and the taxes remain unpaid, the tax certificate is cancelled due to the Statute of Limitation, which will result in the loss of your investment.
If you are a registered tax certificate buyer in Hillsborough County or interested in becoming a buyer, click here to get more to learn more.
Tax Deed Overview for Property Owners / Business Owners
A tax deed application is the action initiated by a tax certificate holder. The tax deed application is a legal document that begins the process wherein the Clerk of the Circuit Court sells the property to the highest bidder at public auction. This process is known as a Tax Deed Foreclosure.
Property owners have 2 years from the date taxes become delinquent before they risk loss of the property. As stated in Florida Statute 197.502, after the 2 year period has elapsed and taxes remain unpaid, the certificate holder may file a tax deed application with the Tax Collector’s office.
The property owner may retain the property by redeeming the tax deed application any time before the property is sold at public auction. In other words, if delinquent property taxes are paid off while property is in a tax deed application status, the applicant is reimbursed for their total investment, accrued interest and the tax deed sale process is stopped.
The statute of limitation on tax certificates is seven (7) years. Therefore, should the taxes remain unpaid and the tax certificate holder does not elect to make application for tax deed within the seven year period, their investment is lost.
As part of the Tax Deed process, the Clerk of the Circuit Court sets the sale date and notifies the applicant of the additional costs associated with the sale, which the applicant must pay. These additional costs include the advertising cost, mailing cost and the Sheriff’s fees. Please note, the tax deed foreclosure process can take months to complete due to statutory requirements governing tax deed sales. Generally, tax deed sales are held in the Jury Auditorium on the 2nd Floor of the George E. Edgecomb Courthouse located at 800 East Twiggs Street, Tampa 33602.
For more information, you can visit the Clerk of the Circuit Court’s website or contact our office. Tax Deed Sales and Lands Available Information.
Property Owners / Business Owners
Under the Bankruptcy Code, a tax lien for unpaid property tax is classified as a secured claim, meaning the debt is secured by the value of your property. In a Chapter 7 bankruptcy, secured claims are paid first through the sale of your assets, with property tax liens often taking priority over all other debt. Most tax debts cannot be eliminated in a Chapter 7 bankruptcy and must be repaid in a Chapter 13 bankruptcy. Generally, if you do not surrender your property to the bankruptcy court or trustee, you are still responsible for unpaid property taxes.
Investors may buy the tax certificates by paying all delinquent tax and fees due. If your tax certificate is sold, and bankruptcy is filed after a tax certificate sale you are required to make payments to the investor (via trustee) for unpaid property taxes. The investor can legally foreclose on your property if you fail to make payments. Filing bankruptcy can put a stop to the sale of your property’s tax certificate.
The Tax Collector is prohibited from attempting to collect your tax debt during bankruptcy proceedings as a result of the automatic stay that goes into effect as soon as you file for bankruptcy protection. If you include the property in the bankruptcy estate, the Tax Collector will look to the court-appointed bankruptcy trustee (Chapter 7) or to your repayment plan (Chapter 13) for collection of your debt. If your property has no equity and the trustee abandons it, the Tax Collector looks to the property itself for collection of the debt, in accordance with Florida statutes.