Can You Sell Land With Back Taxes? Yes — Here's How It Works
Key Takeaways
- Yes, you can sell land with delinquent property taxes: Back taxes do not prevent a sale — they are treated as a lien on the property and are paid from the seller's proceeds at closing, so the buyer receives clear title, according to title company closing procedures documented in multiple states
- Tax liens carry first-priority status in most states: According to the Center for Community Progress, property tax liens are typically given first-priority status over almost all other debts — including mortgages — meaning they must be paid before any other liens at closing
- Redemption periods before you lose the land range from 12 months to 3 years across most states: Depending on where your property is located, you may have anywhere from 12 months (Georgia, Tennessee, South Carolina) to 3 years (Alabama, Arizona, Colorado) after a tax sale to pay the taxes and keep your land, according to LienSuite's 2026 state-by-state redemption period data
Can You Sell Land With Delinquent Property Taxes?
Yes — you can sell land that has delinquent property taxes. Back taxes are a lien on the property, not a lock on it. In a standard real estate closing, the title company identifies all outstanding tax liens during the title search, calculates the total amount owed including interest and penalties, and deducts that amount from the seller's proceeds at closing. The buyer receives clear title. This process applies whether the taxes are one year past due or several years past due — as long as the property has not already been sold at a tax sale and the redemption period has expired.
This guide explains how tax liens work, what the tax sale timeline looks like in several states, what title companies actually do, and which selling path makes the most sense depending on how far behind the taxes are.
How Do Property Tax Liens Work?
When a property owner fails to pay property taxes, the local government places a tax lien on the property — a legal claim that secures the debt. According to the Center for Community Progress, a nonprofit focused on vacant property policy, tax liens are "given first-priority status, meaning it needs to be paid back before almost any other debts, such as a mortgage."
This priority status is crucial for sellers to understand. Even if the property has a mortgage or other outstanding liens, the county's tax lien must be satisfied at or before closing. A buyer's lender will not fund a loan on a property with an unsatisfied tax lien, and a title company will not insure clear title until those taxes are paid.
What Happens After Taxes Go Delinquent?
The path from missed payment to tax sale follows a timeline set by state law. Generally, it works like this:
- Taxes become delinquent — typically on a specific date set by the county (often February 1 or April 1 of the year following the tax year). Interest and penalties begin accruing immediately.
- County sends notices — the county treasurer mails delinquency notices. Multiple notices are usually required by law, including certified mail in later stages.
- Property is listed for tax sale — after a statutory waiting period (which varies by state), the county advertises the property and holds a public auction. In most states, investors can buy either the tax lien certificate (giving them the right to collect the debt plus interest) or a tax deed (giving them ownership subject to a redemption period).
- Redemption period begins — after the tax sale, the original owner has a state-defined window to pay off the debt and reclaim their property. This is the last chance to sell before the buyer at the tax sale forecloses on any remaining interest.
- Foreclosure / deed issued — if the owner does not redeem within the redemption period, the tax sale purchaser moves to foreclose on the right of redemption and take clear title.
The key insight for sellers: at any point before step 5 is complete, you can still sell. As long as there is equity in the property — meaning the value exceeds the amount of taxes, penalties, and interest owed — a sale can pay off the taxes and put money in your pocket.
What Are the Redemption Timelines in Key States?
Redemption periods differ significantly by state, and in some cases by the type of property or length of delinquency. The following represents verified state-specific information from official and legal sources.
Georgia — 12 Months With 20% Penalty (O.C.G.A. § 48-4-42)
Georgia is a "redeemable deed" state. The county records a tax deed in the investor's name at the time of the tax sale, but the original owner retains the right to redeem for 12 months from the sale date. To redeem, the owner must pay the purchase price paid at auction plus a 20% premium for the first 12 months (or any portion of a year), according to O.C.G.A. § 48-4-42. After 12 months, the investor can begin a process called "barment" under O.C.G.A. § 48-4-45 to permanently extinguish the right of redemption. Selling before that barment is filed keeps options open.
Alabama — 3 Years at 12% Per Annum
Alabama is a tax lien state with a 3-year statutory redemption period. According to the Alabama Department of Revenue, property owners may redeem their property within 3 years of the tax sale by paying all taxes, interest, fees, and penalties at a rate of 12% per annum. After the 3-year period, the lienholder can pursue foreclosure to quiet title, according to a legal analysis published via JDSupra. The extended redemption window means Alabama landowners typically have more time to arrange a sale before losing the property.
Mississippi — 2 Years at 1.5% Per Month
Mississippi holds its annual tax lien sale on the last Monday of August each year. After the sale, the property owner has a 2-year redemption period from the date of the sale, per Miss. Code Ann. § 27-45-3. Interest accrues at 1.5% per month (18% annually), according to Jackson County's published tax sale procedures. If the owner does not redeem within 2 years, the Chancery Clerk executes a tax deed to the purchaser and — if unredeemed — the property is certified to the Secretary of State.
Michigan — 3-Year Forfeiture and Foreclosure Process
Michigan's process is among the most structured. According to the Michigan Department of Treasury, delinquent property "entails a three-year forfeiture and foreclosure process." Specifically: unpaid taxes become delinquent March 1 of Year 2; the property forfeits to the county treasurer March 1 of Year 3; taxes remaining unpaid March 31 of Year 4 (the third year of delinquency) are foreclosed by the Foreclosing Governmental Unit; and the county takes possession April 1 following the foreclosure judgment. Landowners in Michigan have meaningful time to sell — but must act before that March 31 third-year deadline.
Pennsylvania — Upset Sale After 2 Years of Delinquency, No Post-Sale Redemption
Pennsylvania's Tax Claims Bureau conducts "upset sales" when real estate taxes are 2 or more years delinquent, according to Legal Aid of Southeastern Pennsylvania. A critical distinction: unlike most other states, Pennsylvania offers no post-sale redemption right. Once a property sells at an upset sale, the former owner can only challenge the sale procedurally — not redeem it by paying the back taxes. This means Pennsylvania landowners with 2+ years of delinquency face a hard deadline. Property can be paid in full at any time up until the upset sale itself, including the morning of the sale.
Oklahoma — Annual June Resale Auction (Title 68 § 3105)
Oklahoma conducts a single annual tax resale for all delinquent properties. Under Title 68 § 3113 of the Oklahoma Statutes, property owners may redeem at any time prior to the commencement of the resale auction, which is held each June, according to the Oklahoma County Treasurer. After 3 years of delinquency, the county treasurer is required to advertise and sell the property at the June resale, per 68 O.S. § 3105. If no buyer purchases the property at the resale, it becomes county-owned property under 68 O.S. § 3135.
Tennessee — Up to 1 Year After Sale, Based on Delinquency Length
Tennessee is a redeemable deed state where the redemption period runs after the tax sale and is tied to how long the taxes have been delinquent. According to Tenn. Code § 67-5-2701, the standard redemption period is 1 year (for properties with 5 or fewer years of delinquency), but this shortens to 180 days for 5–7 years of delinquency, 90 days for 8 or more years, and just 30 days for vacant and abandoned properties. The Shelby County Trustee confirms that interest during the redemption period runs at up to 12% per annum on the investor's bid amount.
| State | Sale Type | Redemption Period | Interest/Penalty | Key Statute |
|---|---|---|---|---|
| Georgia | Redeemable Deed | 12 months | 20% premium | O.C.G.A. § 48-4-42 |
| Alabama | Tax Lien | 3 years | 12% per annum | Ala. Code § 40-10-83 |
| Mississippi | Tax Lien | 2 years | 1.5%/month (18%/yr) | Miss. Code § 27-45-3 |
| Michigan | Tax Deed | ~3-year process | Varies; fees + interest | Mich. Comp. Laws § 211.78 |
| Pennsylvania | Tax Deed | No post-sale redemption | N/A | 72 Pa. Stat. § 5860 |
| Oklahoma | Tax Deed | Until June resale | N/A | 68 O.S. § 3105, § 3113 |
| Tennessee | Redeemable Deed | 1 yr / 180 days / 90 days | Up to 12% | Tenn. Code § 67-5-2701 |
What Does the Title Company Actually Do With Delinquent Taxes?
Most sellers are relieved to learn they do not need to pay the back taxes out of pocket before closing. The title company handles it automatically as part of the closing process.
The Title Search Identifies Every Lien
When a buyer opens escrow and orders title insurance, the title company conducts a search of the public records for the county where the property is located. This search identifies every recorded lien, judgment, or encumbrance on the property — including outstanding property taxes for every year unpaid.
Taxes Are Calculated and Deducted at Closing
Once the title company knows the amount of delinquent taxes, interest, and penalties owed, it adds that figure to the closing statement as a line item payable from the seller's proceeds. As Daughtrey Law, a Texas real estate firm, explains in its closing guide: "The title company catches this when ordering the tax certificate. It deducts delinquent taxes, plus penalties and interest, from the seller's proceeds at closing. As a result, the buyer receives clear title without inherited tax debt." California-based Viva Escrow similarly notes: "Delinquent taxes will be updated for penalty increases and paid from the Seller's proceeds at closing."
What If the Taxes Exceed the Property's Value?
This is the key risk scenario. If the accumulated delinquent taxes, penalties, and interest have grown to exceed what the property will actually sell for, you would need to bring money to closing rather than receiving proceeds. In practice, this situation is rare for land with legitimate market value — but it is possible for very low-value parcels that have been neglected for many years.
In this scenario, your options are to negotiate a short payoff with the county (not all counties allow this), sell to a buyer willing to assume the tax debt (uncommon), or allow the tax sale process to run its course. Consulting a local real estate attorney before listing is advisable if the tax balance is approaching the property's estimated value. If you are unsure what your land is actually worth net of the tax balance, see our guide on how much your land is worth — understanding market value is the first step before deciding whether a sale makes sense. If you want a written number without going through a full listing process, you can request a no-obligation cash offer and know exactly where you stand within days.
What Are Your Options for Selling Land With Back Taxes?
Once you understand the timeline, you have a clear decision to make. Here are the three main paths, each with honest trade-offs.
Pay the taxes, then list with an agent. If the delinquent balance is manageable and you have the funds to pay it, clearing the lien first gives you the cleanest path to a full-market sale. You can list on the open market without any disclosure complications and attract conventional buyers whose lenders will approve financing. Agent commissions of 5–6% plus closing costs apply, and the marketing timeline for rural land can run 3–12 months — see our guide on how long it typically takes to sell land for a data-backed breakdown by land type.
Sell as-is, letting the title company handle it at closing. This is the most common approach for land sellers with back taxes. You simply accept an offer, disclose the delinquent taxes, and let the title company deduct the balance from your proceeds at closing. You receive the difference. No upfront payment required. This works well as long as the sale price exceeds the tax balance plus closing costs. If you are managing the sale yourself, our guide on how to sell land by owner covers how to handle tax disclosures and coordinate with the title company through closing.
Sell directly to a cash land buyer like Jerez Land. Cash buyers purchase land as-is, including properties with delinquent taxes, title complications, or multiple heirs. This option is especially valuable for inherited land with back taxes, where title complexity and unpaid balances compound one another. Because there is no lender involved, there are no financing contingencies and no lender requirements around the tax status. Jerez Land can typically make an offer within a few days and close in 2–4 weeks, well within most state redemption periods. The offer accounts for the tax balance — you receive the net proceeds at closing with no surprise deductions afterward.
If your property is approaching the tax sale date or you have already received a notice of delinquency, acting quickly is important — especially in states like Pennsylvania where no post-sale redemption exists. Request a cash offer to understand what your land is worth net of taxes, or explore more land-selling guidance on our blog.
Frequently Asked Questions
Can I sell my land if I owe back property taxes?
Yes. Delinquent property taxes are a lien on the land, not a prohibition on selling it. At closing, the title company identifies the total amount of delinquent taxes, interest, and penalties owed and deducts that amount from the seller's proceeds. The buyer receives clear title. The only situation that prevents a sale is if the tax sale process has already concluded and the redemption period has expired — at that point, the investor or county that purchased the tax deed may own the property.
What happens to back taxes when land is sold?
Back taxes are paid at closing from the seller's proceeds. The title company orders a tax certificate from the county, confirms the exact amount owed, and includes the delinquent balance as a line item on the settlement statement. The amount is wired directly to the county at closing. This process is standard in all U.S. states and ensures the buyer receives marketable, insurable title.
Can I lose my land if I don't pay property taxes?
Yes, though the timeline varies significantly by state. After taxes become delinquent, the county will eventually hold a tax sale. In most states, the original owner then has a redemption period — ranging from roughly 12 months in Georgia and Tennessee to 3 years in Alabama — to pay the debt and reclaim the property. If the owner does not redeem within that window, the purchaser at the tax sale can foreclose on the right of redemption and take clear title. Pennsylvania is notably stricter: there is no post-sale redemption right once an upset sale occurs, according to Legal Aid of Southeastern Pennsylvania.
How much interest and penalties accumulate on delinquent land taxes?
Interest and penalty rates are set by state law and vary considerably. Mississippi charges 1.5% per month (18% annually) on delinquent tax amounts, per Miss. Code § 27-45-3. Alabama charges 12% per annum, according to the Alabama Department of Revenue. Georgia requires a 20% premium for redemption within the first 12 months under O.C.G.A. § 48-4-42. Tennessee pays up to 12% annually on the investor's bid amount during the redemption period, per the Shelby County Trustee. In all cases, the longer taxes remain unpaid, the larger the total payoff figure grows.
Do I need to pay the back taxes before I can accept an offer?
No. You do not need to pay the back taxes before accepting an offer or before closing. The standard process is to accept an offer, open title, and allow the title company to calculate and pay the delinquent taxes from your proceeds at closing. If the delinquent balance is large, discuss it with any prospective buyers upfront so there are no surprises on the settlement statement.
What if my property has already been sold at a tax sale?
If your property has already been sold at a tax sale and you are within the redemption period, you can still redeem by paying the investor the amount they paid at auction plus the applicable interest or penalty. If you have received a barment notice (in Georgia) or a foreclosure petition has been filed (in Michigan or other states), time is critical — consult a local real estate attorney immediately. Once the redemption period expires and foreclosure is finalized, the original owner generally has no further right to the property.
Disclaimer: This article is for informational purposes only and does not constitute legal, financial, or professional advice. Laws and regulations vary by jurisdiction and change over time. Always consult with qualified professionals before making land purchase decisions. Jerez Land is not responsible for actions taken based on this information.