
Missed the tax deadline? Here’s what you should do
If you haven’t filed your taxes yet, don’t panic — but act fast.
Tax sale is a money term you need to understand. Here’s what it means.
A tax sale is a government sale of property to recover unpaid taxes.
Financial institutions use tax sales to recoup property if the property owner is delinquent in paying his or her property taxes. After a certain period of time, if taxes owed are not paid off, the financial institution can sell the property to the highest bidder and oust the property owner from the property.
As a property owner, it is your responsibility to pay property taxes on your land and the estimated value of the building that sits on that land. If and when you fail to pay these taxes, you run the risk of the lending institution that holds your mortgage taking your home and posting it for sale at the price of the taxes that you owe.
While tax sales are obviously not a profit-making scheme for financial institutions, they are effective at putting pressure on property owners to pay the taxes owed. The fear of losing a home or other property is a pretty strong motivation for most people to pay what they owe.
Before a tax sale is put into action, the property owner must receive clear documentation spelling out his delinquency and requesting the payment of back taxes. A financial institution simply cannot oust a property owner without due process.
In response to the notifications that property owners receive before their property is put up for a tax sale, a niche industry providing tax liens to delinquent property owners has popped up to fill this need. Usually, liens are given at very high interest rates and must be paid back, or the lending party receives the title to the property.
If you own a home and owe $5,000 yearly in property taxes on your home’s assessed value, you must pay this money to keep your home. If you do not pay for some reason even after warnings from your bank, it may put up your home in a tax sale.
Need some more information to better understand your taxes? Check out our tax calculators to learn more about brackets, deductions, and more.
If you haven’t filed your taxes yet, don’t panic — but act fast.
Typically, taxpayers have two options: Take the itemized deductions or take the standard deduction.
Regardless of what may cause a person to miss the tax-filing deadline, there are potential consequences.
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