Tax Certificate Sale

What is a Tax Certificate? A tax certificate represents a lien on real property and bears interest at a maximum rate of 18% per year. The cost to purchase a certificate is listed beside each parcel in the delinquent advertisement, and includes gross tax, interest, advertising cost and the cost of the Tax Certificate Sale.

What is a Tax Certificate Sale? On the advertised day and time, the Tax Collector auctions and sells a tax certificate on each delinquent parcel. Since the taxes on some parcels will have been paid prior to the sale, those parcels that appeared in the newspaper advertisement will be skipped. Bidding begins at 18% and the certificate is sold to the person bidding the LOWEST annual interest rate.

What is an Internet auction? An auction in which bids are transmitted and received through the Internet at http://BidCharlotteCounty.com.

How does the bidding proceed? Each parcel is auctioned in the order listed in the advertisement. The bidder begins at 18%(the maximum rate) and is biddown. The winning bidder’s number and rate of interest bid are recorded. Any item not bid on is struck to the County. At this time we encourage you to remember certificates with a 0% bid interest rate WILL NOT accrue interest.

What if there are no bidders? If there are no bidders for a certificate, it is issued to the County at 18% interest.

How are tax certificates redeemed? In order to clear the tax property of the tax certificate lien, the property owner must pay the amount of the tax certificate plus the rate of interest at which the certificate was sold, calculated from the month of the sale to the month of the redemption with a 5% minimum unless the bid was 0%. If the bid was 0%, there will be NO interest accrued. When a tax certificate is redeemed, on or after June 1, a $6.25 redemption fee is also charged. After redemption, the certificate holder receives the amount invested plus interest. Please note that interest earned is taxable and must be reported to the IRS. Each January, an IRS 1099-INT form is sent to each certificate holder for earnings in the previous year.

What if the certificate is not redeemed? If the certificate is not redeemed within two years from the date the tax became delinquent, the certificate holder may apply for a tax deed, and bring the land to sale at a public auction. Example: 2006 taxes became delinquent April 1, 2007; therefore, a tax deed application may be made after April 1, 2009. A certificate holder who wishes to apply for a tax deed must redeem all the other certificates and pay other fees as mandated by state law.

Can a property owner stop a land sale? Yes. The owner of the property can prevent the loss of the land by paying all accrued taxes, costs, and interest at any time before the tax deed is issued.

What is the life of a tax certificate? The life of a tax certificate is seven years from the date of issuance. If the certificate holder does not apply for a tax deed within the seven years, the certificate is null and void.

Is this a risk free investment? No, although a secure investment in most cases, as with any investment, there is an element of risk. There are three possible risks to consider:

  1. If there is a correction to the original taxes levied which would decrease the certificate value or cancel the certificate, the law provides for the portion in error to be refunded to the certificate holder with 8% interest or rate of interest bid, whichever is less, per annum calculated monthly to the date of cancellation or correction.

  2. If the property value drops significantly in subsequent tax years, it may cost more to bring the property to sale than the value gained by owning the property.

  3. If the landowner enters into bankruptcy, the certificate holder is prevented from enforcing the lien until the bankruptcy is released. In one instance, the bankruptcy court lowered the interest rate and ordered payments to be made over a five year period.

Are the County's certificates available for purchase? Yes, County held certificates are available for purchase at http://Charlotte.LienExpress.net. When someone buys a county certificate, the lien is transferred to the buyer. The purchase price is the amount of the original certificate plus interest due to the date of purchase, plus $6.25 administrative fee. The interest rate of the purchased certificate is 18%.

How do I become a bidder? Beginning in May bidders may register online at http://BidCharlotteCounty.com. A registration form must be completed online for each bidder, with name, address, phone number, and tax-payer identification or social security number.

If you have any additional questions please call (941)743-1350.
We are here to help.