Sell a House With a Tax Lien in Clearwater — Fast, As-Is, Cash

Pinellas County taxes unpaid after March 31 become delinquent, and by June 1 the Tax Collector sells a tax certificate on the parcel to an investor who is repaid with interest when the taxes are redeemed. After two years the certificate holder can apply for a tax deed, and the Clerk of the Circuit Court schedules a sale. The owner can redeem by paying the full amount at any time until the Clerk issues the tax deed. In a sale to us, the title company pulls the redemption figure, pays it at closing, and the certificates are cancelled. Nothing about the certificate process requires you to pay first; the lien is simply one of the items on the settlement statement.

A notice of federal tax lien attaches to all of your property, including your Clearwater home, from the date it is recorded. To sell, the lien has to be dealt with in one of three ways. If the equity covers the tax debt, the IRS is paid from the proceeds at closing and issues a release. If the equity covers part of it, the title company requests a certificate of discharge, which releases the specific property from the lien in exchange for the IRS receiving the net proceeds; this application takes time, commonly several weeks, so it should start as soon as a contract is signed. If the home has no equity after the mortgage, a discharge can still be requested on the basis that the IRS receives nothing from the sale anyway. State tax warrants from the Florida Department of Revenue work in a similar way. We have no control over the IRS's timeline, so the contract's closing date is set to accommodate it.

Before closing, the title company searches the Pinellas County official records by your name and by the property. Tax liens appear alongside anything else that attaches to the house: mortgages, a condo or homeowners association claim of lien, City of Clearwater code enforcement orders, judgment liens from a lawsuit, child support liens, and the tax certificates discussed above. Each is paid, negotiated or released at closing according to its rules. You see every item on the settlement statement before you sign. If the total of the liens exceeds what the house will sell for, we tell you early and explain which ones can be reduced or discharged, rather than discovering it at the closing table.

A financed buyer's lender wants every lien resolved before it will fund, and it wants the resolution to fit its own schedule. An IRS discharge that arrives three weeks after the lender's rate lock expires kills a retail sale. A cash purchase has no lender clock. We sign a contract, the title company does the lien work, and we close when the releases are in hand, whether that is next week or in two months. We also buy as-is, which matters because a house whose owner has been dealing with a tax problem has often also deferred the roof, the air conditioner or the yard that drew a code notice.

Liens follow the property, not the person. A tax certificate on a parent's home in Greenwood remains after the parent's death, and an IRS lien recorded against the parent attaches to the estate's assets. If the home is in probate in the Sixth Judicial Circuit, the personal representative resolves the liens from the sale proceeds in the same closing, and the estate's attorney coordinates any required notice to the IRS. We can contract with the estate before the court's order issues and close as soon as it does, with the liens cleared on the settlement statement.

Gather whatever you have: the Tax Collector's notices, any IRS letter with the lien amount and the recording information, and any other collection letters. Send us the address. We will look at the house within a day or two, deliver a written offer within 24 hours of the visit, and ask the title company to begin the lien search immediately so that the payoff and release requests, including any IRS discharge application, start before the closing date is set. We pay the customary closing costs. Your net is the price minus the liens and any mortgage, and you will see that figure in writing before you commit.