You Just Got Hit With A 7% Penalty Fee For Your Delinquent Real Estate Taxes. Now What?

Keeping in the spirit of positivity during the second month of 2020, we’re going to encourage you to not dwell on your past mistakes – even if the latest one occurred on Jan. 31. In moving forward, make it your goal is to arrive at a solution that will make it easier for you to get back on your feet and avoid the same setback year after year. We know that plans aren’t foolproof. We also know that life or end-of-the-year planning can throw them off in a major way. If you’re currently trying to manage delinquent real estate taxes, here are a few things to keep in mind so your current situation doesn’t spiral out of control.

Reality Number 1: You Really Are Late

We’ve covered this a number of times on the blog, and we’re going to keep mentioning it since the circumstances will never change. In the great state of Texas, property taxes are considered late if they are not paid in full by January 31. It doesn’t matter if you mailed your payment in on that exact date or had it postmarked before the 31st. If the outstanding amount hasn’t been received by Jan. 31, you’re late. Now there are a few exceptions – like if you didn’t receive your tax bill at least 21 days before the payment deadline or you’ve decided to file an appeal. Outside of those reasons, you are technically behind, so you’ll need to develop a strategy for resolving your delinquent real estate taxes.

Reality Number 2: Communicating Is The Best Policy

When your property tax bill is behind, it’s never a good idea to act as if it’s not a huge concern. To prevent a slew of problems and unnecessary stress, communication is key. Why? Some central appraisal districts take action fast, and before you know it, your failure to pay property taxes could cost you your residential or commercial space.

For example, in the Fannin Central Appraisal District, late property taxes set off a chain of events. Once all payments are accounted for, a Delinquent Tax Roll (DTR) is created and distributed to all taxing units and the law firms they partner with to collect delinquent property taxes. The law firms will then send letters to property owners listed on the DTR which state that outstanding amounts must be satisfied or legal action will be taken against them. The appraisal district will also send letters to remind people of important payment deadlines.

At this stage, property owners will receive a 6% penalty and 1% interest for the first month, or portion of the month, in which their payment became late. The 1% penalty will be tacked on each month after until July. In July, the penalty is capped at 12%, and it will stay at that rate until the past due amount is satisfied. The 1% interest penalty will continue to be added each month until the tax bill is paid off. If your late property taxes are not paid off by July, up to 20% in attorney fees and additional penalties and interest fees could be tacked on to your bill.

The Fannin Central Appraisal District and many others encourage those who are behind on their property taxes to keep the lines of communication open. So, reach out to the collections staff sooner rather than later to find out if you can set up a payment plan or if you might qualify for a property tax deferment or exemption.

Reality Number 3: You Can Get Help Paying Property Taxes

In an ideal world, your taxing authority would be sympathetic and work with you to assist in resolving your late property tax bill. But in the event that their best offer or payment plan won’t do, you still have a very solid option – a commercial or residential property tax loan from Tax Ease. If you think you’re the only one who’s dealing with delinquent real estate taxes, you’re not. Each year, Tax Ease helps thousands of people across Texas resolve their overdue tax bills so they can avoid mounting penalties, interest rates, attorney fees and ultimately, the threat of foreclosure. The application process is simple and you can get a decision in 24 hours.