What is an IRS Tax Deed Sale?

Purchasing real estate is one of the biggest investments that people make in their lives, considering the cost of acquiring properties, as well as the associated property taxes. The latter can form a huge bulk of expenses, which buyers need to pay to stay out of debt and avoid foreclosure.

Property taxes can be paid off through an IRS tax deed sale, which is a recommended way of acquiring property. 

IRS Tax Deed Sale 

An IRS tax deed sale is a form of contract that states that the property is going to be sold off to another party and the proceeds of which will be used to pay off unpaid property taxes. When acquiring property under an IRS tax deed sale, the individual will usually be given two years to pay what is owed. It’s an advantageous process because it removes most of the mortgage liens on a property. 

What Happens if You Don’t Pay Tax Certificates 

If a person does not pay the property taxes that are owed, a tax deed certificate will be issued, which gives them a certain amount of time to redeem the certificate and settle payments. The owner of the certificate will get paid interest on the debt that is owed. 

If they do not make payments for another year and the tax certificate is not settled, the unpaid property taxes, plus interest, will be added to their debt. After two years of non-payment of tax certificates, they will get a notice of a tax deed sale and the property can be sold. 

Although they are not required to do so, there are instances when banks can pay the tax certificate if the debtor has a mortgage on the property. 

If the tax deed sale goes through, most mortgage liens are wiped off the property. This, however, does not include every single lien, and may not cover water bills, banks, associations, FPL, or county violations.

Engage a Lawyer When Acquiring an IRS Tax Deed Sale 



An IRS tax deed sale can be a very complex area of law. There’s the risk of losing the property if tax payments are not made, or the process becomes riddled with mistakes. When acquiring an IRS tax deed sale, whether as an individual, as a spouse, or during a divorce, it’s highly advisable to engage good counsel who has the experience needed to provide guidance through the process.