Overview of New York property tax liens

| Jul 11, 2019 | federal and state tax collections

Residents of White Plains probably do not have to be told that the State of New York uses multiple different types of taxes in order to generate revenue for different government programs.

Those who own homes or other property in this state, for instance, will likely have to pay property taxes. If they do not do so, then, as is the case with other types of taxes, the state, or a subdivision, may pursue collection efforts.

In the case of property taxes, the government may assess a tax lien on a piece of property where a tax bill is delinquent. While a property owner will have an opportunity to redeem the lien by paying off what is owed, the government may sell the lien to another investor. At a certain point, the new owner of the lien may elect to foreclose on the property much like a bank would foreclose on a mortgage.

Once a foreclosure action starts, the owner of the tax lien has the right to demand not only the amount owed on the property but also costs and attorney fees.

The lesson here is two-fold. For one, it is important that New Yorkers remember that not all tax-related issues involve the state or federal income tax.

Particularly when someone is already suffering financial distress, property taxes can also lead to thorny state collections issues. If left unaddressed, an aging tax bill can cause serious problems, including the loss of one’s property to foreclosure.

A person who is behind in property taxes, income taxes, or any other tax assessment should strongly consider speaking to an experienced tax attorney.

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