Have questions about Taxes Tax Sales? Here’s the answer to a couple of questions about Texas tax sales that I got a few years ago. These are questions that I frequently get and the answers to these questions are still relevant today…

Questions:

I am going to my first auction in Texas.

1. If I win a bid, when can I move into the house?
2. What other liens- IRS, creditors have priority over tax liens?
3. How do I find out if any of these liens are in place?

Answer to Texas Tax Sale Question #1:

At Texas tax sales, the winning bidder purchases a redeemable deed and is considered the owner of the property once the deed is recorded. The previous owner has a right of redemption which can be either 6 months or 2 years, depending on whether the property is homesteaded or not. The redemption period starts once the deed is recorded, so you’ll want to record it right away. You may have to evict whoever is living in the house before you can move in. Also you have to keep in mind that the previous owner can redeem at any time during the redemption period.

Answer to Texas Tax Sale Question #2:

IRS liens do survive a tax sale and you should read the rules of the sale carefully to find out what other liens my survive. If the rules of the sale are not published or do not specify which liens survive the tax sale, you can look at the state statutes for tax sales or ask the county treasurer or the attorney. Many of the tax sales in Texas are handled by a law office.

Answer to Texas Tax Sale Question #3:

You can find out about liens and judgments on tax sale properties by searching the public records. Many counties in Texas do provide a free online public records website where you can search for liens. The IRS has 120 days to redeem a property that has been sold at a tax sale, so they could come and redeem the property up to 4 months after you purchase it at the tax sale. If they do you will get your investment back plus 6%. The IRS would probably not want to spend a large amount of money to redeem a property for if they only have a small lien against it. But you might want to avoid bidding on deeds that have large IRS liens or judgments against them.