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Tax Liens & Tax Certificates in Ohio

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Matthew A. Schwartz
Matthew A. Schwartz

Ohio Real Estate Attorney

Property taxes are the most confusing and complicated aspect of real estate transfers in Ohio. Without a well-crafted and state-specific purchase and sales agreement, Buyers and Sellers may be unknowingly on the hook for thousands of dollars.  A quality contract will go into detail regarding all of the potential tax issues to eliminate confusion. 

Ohio Counties Charge Taxes in Arrears: Property Taxes as Liens

A lien is a legal right to payment secured by property and in Ohio property taxes are automatically secured by a lien.  To complicate matters, you may have noticed that your property tax bill is one year behind as taxes are billed in arrears.  However, according to Section 323.11 of the Ohio Revised Code, the current year’s taxes are still a lien on your property even though you haven’t received a bill.  Therefore, In order for a Seller to transfer title free and clear, a credit should be issued to the Buyer to compensate for the lien of unbilled taxes usually calculated to the date of closing.  Miscalculation of those taxes, Special Assessments, and tax other discounts such as the Homestead or CAUV for agricultural use are the most common mistakes we see during review of transactions completed by professional title agencies.  

What Is a Tax Certificate?

When real property taxes are not paid, the County may issue a tax certificate and then sell the certificate to a private party

The private party may attempt to collect the debt by any legal means, including foreclosure.  If you receive notice from a private party attempting to collect on a tax certificate, it is important not to ignore the issue, as you may lose title to your property; but also beware of scams. It is prudent to verify the identity and legal claim of any company or law firm attempting to collect on a tax certificate. 

FSBO Properties with Tax Issues

Properties with delinquent taxes can cause issues for the Buyer and the Seller.  

Sellers are often concerned with their ability to sell a property that has delinquent taxes, and often that may be the best strategy.

Buyers may unwittingly find their newly purchased property subject to a foreclosure for taxes owed long before they purchased the property. 

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LEGAL DISCLAIMER:
The information contained on this website is presented for informational and marketing purposes only and is not to be understood as legal advice. You should consult an attorney for advice respecting your individual needs. The Law Office of Matthew A. Schwartz looks forward to speaking with you about your particular needs. Please note, however, that the mere act of contacting our firm does not create an attorney-client relationship. As a result, you should never send any confidential information to our office until a Representation Agreement has been signed by both you and The Law Office of Matthew A. Schwartz.