Do I Have Personal Liability for Not Paying My Property Taxes?
Property taxes are set by local government, and because these funds go into their budget, they have powerful tools to use to collect property taxes and penalize late payments. Here, property tax solutions specialists discuss how non-payment of these taxes can affect you personally, whether it’s regarding your residential property taxes or commercial property taxes.
Non-Payment of Residential Property Taxes
If you do not pay your annual property taxes on your home or an investment property, the entity owning the property (the formal owner) is liable. If the property is titled in an individual’s name, then the person is liable. If the property is titled in an entity, then the entity is liable.
Also, the sale of a property does not allow one to escape personal/entity liability. First, your local tax authority will start charging interest and financial penalties on your account. These penalties are the main concern, as they can be as high as 43% of your original tax bill in the first year alone, and the interest will continue to accumulate on top of this until the bill is paid in full.
A tax lien will be automatically applied to your property every Jan 1 (current and noncurrent alike). It is not extinguished until the taxes and any outstanding penalties or interest is paid. If they are not paid, the foreclosure process will begin.
It is important to remember that you can prevent foreclosure on your home through property tax loans. These loans are designed to cover the full amount you owe to the local government and give you a structured payment plan to repay the amount to the lender. Good property tax loan companies will fully investigate how much you owe and deliver an affordable payment plan that avoids foreclosure and doesn’t require a credit check or a deposit. A property tax loan will stop the foreclosure process at any time before the property is sold.
Non-Payment of Commercial Property Taxes
Commercial properties are also subject to property taxes in Texas, and, as with residential properties, the formal owner, whether it is you as an individual or an entity, is fully liable for these taxes.
If you are deemed responsible for payment of property taxes, this can lead to significant cash flow problems, seizure of the property, and even bankruptcy. Corporate property tax loans are designed to prevent this, and help your business get back on its feet. As with personal property tax loans, commercial property tax solutions are tailored to your circumstances and put an immediate stop to local government proceedings against you and your business. By providing affordable repayment terms and no down payment, the negative impact on your business and personal finances is minimized, giving you time and space to get back on your feet.
Understanding Personal Property vs. Real Estate Property Tax in Texas
In Texas, property taxation is based on the classification of assets, either tangible personal property or real property. This distinction significantly affects how tax liabilities are calculated and reported.
Real estate property tax, also called real property tax, is levied on immovable property such as land and buildings. It’s a type of tax based on the market value of the property, with local taxing units applying a property tax rate to the assessed value of the property. These taxes provide critical revenue for state and local governments.
In contrast, tangible personal property taxes apply to movable assets like business equipment, machinery, and inventory. Businesses must often report these on their tax return. Whether you’re dealing with business, personal property, or real property, the value of a property or asset determines the tax base and the annual tax due.
To ensure accuracy and potentially reduce your tax bill:
- Work with a qualified tax professional
- Apply for any available property tax exemptions
- Consider options for managing or deferring payment if you’re struggling to pay
Correct classification and timely filing can help prevent overpayment, interest charges, and even legal action.
Get Help with Unpaid Property Taxes in Texas
If you’re facing the risk of foreclosure or financial penalties due to unpaid property taxes, a property tax loan can help you take control. Whether you’re dealing with residential or commercial property tax debt, American Finance & Investment Company, Inc., can help.
We can provide you with an instant quote by completing the form on our homepage. For qualifying properties, we can help you pay off your delinquent taxes and offer you the following benefits:
- Quick and completely online process
- No money down
- No credit check
- Free 30-day rate match
- Match competitors and beat their rate by 1%
- Avoid high penalties and foreclosure
We pride ourselves on finding solutions to suit the unique needs of our clients. If you would like to discuss our property tax loans, please contact our experienced team at AFIC today.
