Entries in Tax Lien (2)


Tax Lien Sales: The 'Other' Foreclosure Problem Plaguing Homeowners

iStockphoto/Thinkstock(NEW YORK) -- Homeowners with an outstanding water bill or high property taxes are increasingly discovering why some are more than eager to sell their home to property-hungry investors.

Called the "other" foreclosure crisis, property tax lien sales are enabled by state and local laws that allow the sale of a property through a tax lien foreclosure process if the owner falls behind in property taxes or other bills, like a water bill or even a dental bill.

If homeowners are behind for just a few hundred dollars, their homes can be sold to investors at a tax lien sale for simply the back taxes owed on the property.  If the owner of a $200,000 house fails to buy back the property, for example, it could be sold for as little as $1,200, and then resold for a windfall by the investor.

Annual tax lien sales total about $15 billion in the U.S. and are on the rise because of the weak job market, depressed home values, and an increase in mortgage foreclosures, according to a report released this week by the National Consumer Law Center.

John Rao, staff attorney with the law center and author of the report, "The Other Foreclosure Crisis: Property Tax Lien Sales," said the elderly are the most vulnerable to these types of sales.

"They have owned the home for long time and there's no mortgage company there that will make sure it won't be sold in a tax sale," Rao said.

Rao's main advice about people who are behind in their bills, like property taxes, is to understand the tax lien processes in your state and to seek legal advice, whether paid or pro bono.

"There's a point where you really can lose your house," Rao said.  "If you can afford [legal help], you should do it."

To insure yourself against a tax lien sale, you can ask your mortgager to set up an escrow account for taxes and insurance, so that you will have a monthly payment over time instead of a large tax bill.

Copyright 2012 ABC News Radio


California's List of Top Delinquent Taxpayers Released

Ryan McVay/Photodisc/Thinkstock(SACRAMENTO, Calif.) -- The State of California Franchise Tax Board released its annual list of the state's top 250 delinquent taxpayers on its website Wednesday.  The list includes businesses and individual taxpayers with state income tax liens greater than $100,000.

Former Baywatch star and Playboy playmate Pamela Anderson appears on the list.  She's said to owe $493,144.68 for a tax lien filed on April 7, 2009.  Anderson's residence is listed as Woodland Hills, 30 miles northwest of Los Angeles.

As of April 7, 2011, the biggest delinquent taxpayer was Halsey Minor, founder of CNET, the technology news site.  He and his wife, Shannon, whose address is listed as San Francisco, owe over $13.1 million.  Their tax lien was filed on July 21, 2009.

With the April 18 tax deadline just five days away, celebrities may want to take heed of the new list.

"When taxpayers do not pay their fair share, it places an unfair burden on those who do," the tax board states on the website.  "Closing the gap is in the best interest of all Californians."

The state's annual tax gap is estimated to be $6.5 billion, according to the website.

"We urge any taxpayer who appears on this list to contact us immediately to arrange to pay their delinquent state income tax," the board said.

As of April 8, the IRS has processed over 95.8 million individual tax returns. 

Copyright 2011 ABC News Radio

ABC News Radio