 Sam
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Joined: 21 May 2005
Posts: 281
Location: CALIFORNIA
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 Posted: Fri Apr 09, 2004 2:38 am Post subject: Tax Certificate |
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A tax certificate is a certificate issued to the purchaser of property by the state or local government. The certificate is provided at the time of transfer of property title when the government charges a certain amount of tax payment. It is a claim against property that has a lien placed upon it on account of unpaid property taxes.
The tax certificate allows an owner to gather unpaid taxes along with a certain amount of interest as the return. Based on the state from which you purchase the certificate, the return may be as high as 50%. The tax certificate sale is open to the public and individuals who purchase the certificates as an investment usually attend it.
Based on a tax certificate, a tax deed application is filed. In order to purchase a tax certificate, the purchaser has to provide the tax collector his Social Security Number or Federal Identification Number for reporting interest earned to the Internal Revenue Service.
A tax certificate is issued to the party that bids the lowest interest rate on the tax payment due. The total amount of the certificate is the sum of the unpaid property taxes, 3% penalty, 5% tax certificate sale fee, advertising costs and other assessments. The purchase or redemption of a tax certificate does not transfer title or legal interest in the property.
In order to request for a tax certificate, you may use the form given here. |
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