Property taxes are due either annually, semiannually or in smaller installments three or four times a year. In some states, the due date is followed by a grace period. On or after the delinquency date, penalties and/or fees are assessed. After some amount of time, properties with delinquent taxes are sold at public auction. Tax extensions are not commonly available; however, rules vary by state and, in some cases, by county. Rules also can change year to year.
Relevance of the Due Date
The due date, or in some states the separate delinquency date, is written in stone in every state. In some states, such as Texas, taxes are delinquent the day after the due date. In California, there is a grace period of about a month between the due date and what is referred to as a delinquency date. Once a tax is delinquent, it is subject to penalties and/or late fees, which in all states continue to accrue each month the tax remains unpaid. Both penalties and fees are usually a percentage of the unpaid debt, although there is a substantial range of penalties among states. Each state has another pertinent date, which is the time after which the county begins a foreclosure and auction process.
While property tax extensions are not a normal part of any property tax system, deferrals are. About half of all states offer some type of deferral program for limited groups of tax payers, commonly the disabled, seniors and/or those with low income. In some of these programs, part of the tax due can be deferred; in others, all of it can be deferred, sometimes for as long as the tax payer remains living in the home. In these programs, a lien is placed on the property by the state or county, and the tax is repaid when the property changes hands, which may not occur until after the home owner's death.
In all states, you have until the date a property is sold at auction to repay the tax and accrued penalties and fees to stop the sale. This provides you with considerable time because most states do not approach the auction date for at least two years after the initial delinquency. In California, you have five years before the county sells your house as a result of unpaid back taxes. In Michigan, you have until March of the third year after you missed the tax due date.
Many states and counties offer partial property tax exemptions for certain classes of property owners, such as those with low income, the disabled, and those age 65 or over. Most places also offer a partial exemption for owner-occupied homes. You still owe a tax, but it may be within your ability to pay. Exemption status is not automatic; you must apply with your county tax assessor or collector. You may also qualify for a reverse mortgage, the proceeds of which may be used for any purpose, including property tax payment. In many counties, you can pay property tax by credit card. If you cannot pay your property tax but are able to keep up with your minimum monthly mortgage payments, you may benefit from charging your property tax until you can find a way to fully repay the debt. You will avoid tax penalties and will not risk losing your house.
- Retirement Living Information Center: Taxes by State; January 2011
- California Board of Equalization; California Property Tax; August 2009
- Bexar County Tax Assessor-Collector; Property Tax Calculations
- Tennessee Advisory Commission on Intergovernmental Relations; Property Tax Reduction and Relief Programs; Stanley Chervin; June 2007
- Minnesota Legislature: Senior Citizens Property Tax Deferral Program; October 2010
- Washington State Department of Revenue: Property Tax Deferral for Homeowners with Limited Income; October 2010
- Michigan Department of Treasury; Real Property Tax Forfeiture and Foreclosure