What Are Past Due Property Taxes?

Property taxes are assessed by local governments to fund public services such as schools, roads, and emergency services. These taxes are typically due on specific dates, as outlined in your property tax bill. When taxes are not paid in full by the due date, they are considered delinquent, and the property owner may face additional costs, including interest and penalties.

Consequences of Unpaid Property Taxes

Failing to pay property taxes can have serious consequences for homeowners. Here’s what happens when property tax payments are missed:

1. Interest and Penalties

Once your property taxes are past due, interest begins to accrue. New Jersey law allows local governments to charge interest on delinquent property taxes, often at rates as high as 18% per year. Additionally, penalties may be applied, increasing the amount taxes owed.

2. Tax Liens

If property taxes remain unpaid for an extended period, the tax collector can place a lien on your property. A tax lien is a legal claim that ensures the local government has the first right to recover the unpaid taxes from the proceeds of the property, should it be sold.

3. Tax Sale

When delinquent property taxes are not addressed, the property may eventually be included in a tax sale. During a tax sale, the lien on the property is sold to a third party, who then becomes entitled to collect the unpaid taxes plus interest. If the delinquent property taxes and associated costs are not paid within a certain timeframe, the property could be subject to foreclosure.

What Can Property Owners Do About Past Due Property Taxes?

If you’ve fallen behind on your property tax payments, there are steps you can take to resolve the situation and avoid losing your property.

1. Contact the Tax Collector

The first step is to reach out to your local tax collector to understand your options. Explain your financial situation and request details about the amount owed, including interest and penalties. Please be advised that waiting too long to address the issue may lead to additional costs.

2. Set Up an Installment Payment Plan

Some municipalities offer installment payment options for delinquent taxpayers. This allows you to pay off the taxes owed over time, making it easier to manage your finances while bringing your account up to date.

3. Redeem the Property

If your property has been subject to a tax lien or included in a tax sale, you may still have the opportunity to redeem the property. This typically involves paying the outstanding taxes, interest, and any fees owed to the lienholder or the local government. Acting quickly is crucial, as the window for redemption may be limited.

4. Explore Financial Assistance

In some cases, financial assistance programs may be available to help with property tax payments. These programs are often designed for low-income property owners, seniors, or those facing unexpected financial hardships.