Tax Sale 

 

  What is the tax sale?

When a delinquent taxpayer refuses to pay his/her property taxes on or after January 1st, the Revenue Commissioner must begin the process of preparing to sell the property to satisfy the taxes due.

After all attempts to notify the property owner of delinquent tax are exhausted, the property is then offered for sale at public auction in the courthouse on the third Tuesday in May.

By purchasing a parcel of land in the tax sale, you are placing a "lien" on the property redeemable by the property owner through this office for up to three years from the date of the sale.  Upon redemption, the property owner is required to pay the buyer the initial delinquent tax and cost plus any additional property tax the buyer has paid up to the three year redemption period.  The property owner is required to pay the buyer interest on the sale amount.  The interest rate on tax sale property is 12% annually.

After the three year redemption period, the owner of the property is no longer able to redeem his/her property through this office and must communicate with the buyer directly.


Can I purchase delinquent tax property from the State of Alabama?

When tax sale properties are not auctioned to individual bidders, the Tax Sale Certificate is transferred to the State of Alabama Department of Revenue, Property Tax Division in Montgomery. The property is available for purchase from the state by making application.  Below are the rules and procedures which must be followed in order to purchase these delinquent properties.

Listing of Properties

The Alabama Department of Revenue maintains a list of all properties available for purchase. You may download a copy of this list on their website; www.revenue.alabama.gov.  Choose the Divisions and Services heading from the top menu bar and scroll down to select Property Tax.  You will then be automatically directed to the Property Tax Division page.  From this page you may select the county in which you are interested in viewing and print delinquent property listings, application procedures and the ADV: LD-2 application form.  Directions on how to read the transcript of tax delinquent properties is included on the second page.  Adobe Acrobat is required to read and download information.

Redemption

The State maintains the same three year anniversary date from the date of the tax sale in which a property owner may redeem his/her property and release the tax lien.  During this three year time period, if an individual wishes to purchase a property from the State's delinquent list, he/she will receive a "Sale Certificate" from the Revenue Commission of the county in which the property is located.  If the three year anniversary date has passed, a "Tax Deed" will be issued by the State Department of Revenue.  State issued "Tax Deeds" do not warrant a clear title to the property.  The former owner, or any persons claiming through or under the former owner, has liberal and extensive rights to redeem and recover the property from the tax deed holder.  It is advisable that the potential purchaser thoroughly investigate every aspect of the property before making a purchase.  The State of Alabama gives no legal, financial, or professional advice as it pertains to properties held by the State and recommends a competent attorney be consulted in any case where legal questions or concerns arise.  The Property Tax Division will not be responsible for any action outside of the division's control.

Rules

Individuals, companies or any party affiliated with the applicant is limited to 20 active applications at any one time in the land sale system.  Applicants or an affiliated party who maintain the purchase of a minimum of 10% of the properties in which a quote has been issued, may have their applications accepted and processed in a reasonable quantity in excess of 20%.  Applicants or affiliated parties who make purchases but do not maintain the minimum purchase of 10% of the properties quoted, will be limited to the 20 active applications policy.  As the applicant of affiliated party receives notice that one or more of the properties applied for has become unavailable because of redemption by property owner or other reasons deemed by the Property Tax Division they will be allowed to submit another application as replacement for those which have become unavailable.

An applicant or affiliated party who makes NO PURCHASES after been issued forty consecutive price quotes will forfeit the privilege of having applications accepted or processed for a one year period. 


My property was sold in the tax sale.

If your property has been sold for delinquent taxes, you now have a "lien" against your property.  This property tax lien will not affect your overall credit score but must be satisfied before the property can be sold, used as collateral for a loan, transfer of ownership, etc.

Since the property has been auctioned, it must now be redeemed.  As the property owner, you are given a period of three years to redeem the property with this office.  This is done through our office with the Redemption Clerk.

Since tax sale properties are charged daily interest, you may call or visit our Redemption Clerk to obtain a "pay-off" price based on what date you plan to redeem the property.

You will be responsible for paying the buyer the initial delinquent tax and cost plus any additional property tax the buyer has paid during the three year redemption period.  You are also required to pay the buyer interest on the sale amount.  The interest rate on tax sale property is 12% annually compounded daily.