In Texas, if a property owner does not pay their property taxes, the Tax Collector has a big hammer at his disposal to enforce the payment. In addition to large penalties and fees, the enforcement procedure begins with filing a suit against the property owner, followed by a court order to sell the property at a foreclosure auction, after which the proceeds from the foreclosure sale satisfy the outstanding property taxes.
Who Represents the Tax Assessors/Collectors?
Tax Assessors typically contract with a law firm to manage the legal proceedings involved in collecting past-due property taxes. While each taxing jurisdiction unit can select its attorney, most jurisdictions in the county consolidate enforcement and collections with a limited number of law firms. There are more than forty law firms in the property tax collection business in Texas, with the two largest being Linebarger Goggan Blair & Sampson and Perdue Brandon Fielder Collins & Mott‚ LLP.
What Should You Do If You Are Sued?
Once served with a lawsuit, you must file a written answer to the property tax lawsuit in the court records or have a default judgment filed against you. Filing an answer will slow the suit down, but in no way stop it. The only sure way to stop the lawsuit is to pay the past-due tax bill. Unfortunately, you must also pay the legal fees incurred in filing the suit, such as district court fees, abstract fees, and attorney fees, in addition to the delinquent property taxes. You might decide to fight the lawsuit; however, the tax assessor and collection law firms have no discretion to forgive any amounts owed, regardless of the property owner’s circumstances.
What to Do If You Cannot Pay the Entire Tax Bill?
You have several options to pay the past-due tax bill.
- You might be able to negotiate a payment plan with the tax collector or their collection attorney. Most payment plans require some money down, usually around 25%, and monthly payments after that.
- If you are over 65 and the property is your homestead, you can file a property tax deferral. A property tax deferral will stop the property tax lawsuit, foreclosure proceedings, and allow you to stay in your home. Your taxes will remain deferred until you no longer occupy the property as your homestead.
- Get a property tax loan from a licensed property tax lender. Texas law allows for an approved lender to step in and pay off the past-due taxes and legal fees associated with the suit. Most tax lenders do not require a down payment and will create a payment plan that fits the property owner’s budget. Property tax lenders can offer more favorable terms than those provided by the tax assessor or their collection attorneys.
Past due property taxes are subject to lawsuits that add substantial costs to the property owner. Ignoring the suit can result in foreclosure and loss of your property to satisfy the property tax bill. On the first Tuesday of every month, hundreds of properties are auctioned at county courthouses across Texas to satisfy delinquent tax bills. To avoid a lawsuit and foreclosure, property owners must get their taxes paid.
Ignoring a property tax lawsuit can cost you your property. The longer you delay, the more expensive it will get. There are several options available to most property owners to pay off their tax bills.