What Happens If I Don't Pay Property Taxes in Utah?

People who own real property must pay property taxes. The government uses these taxes to pay for schools, public services, libraries, roads, parks, and the like. Typically, the tax amount is based on a property's assessed value.

When homeowners don't pay their property taxes, the overdue amount becomes a lien on the property. A lien effectively makes the property act as collateral for the debt. All states have laws that allow the local government to sell a home through a tax sale process to collect delinquent taxes.

So, if your Utah property taxes are delinquent, the county can sell your home to a new owner at a tax sale. But you'll have plenty of time to get current on the delinquent amounts before a sale occurs. However, you won't be able to get your home back afterward if you let the sale happen.

How Long Can You Go Without Paying Property Taxes in Utah?

After you're four years behind on your property taxes in Utah, the county can sell your home at an auction (a tax sale) to pay off the delinquent amounts. (Utah Code Ann. § 59-2-1343.)

The sale will take place in May or June. (Utah Code Ann. § 59-2-1351.)

How Does Utah Handle Property Tax Non-Payment?

When the property taxes are sufficiently delinquent, the property is sold at public auction at the county courthouse or electronically. (Utah Code Ann. § 59-2-1351.)

Can Someone Take Your Property by Paying the Taxes in Utah?

At the auction, the winning bid must equal at least the amount of overdue taxes, tax notice charges, penalties, interest, and administrative costs. Sometimes, a bidder can offer an amount sufficient to pay the taxes, tax notice charges, penalties, interest, and administrative costs for less than the entire parcel to get title to only a portion of your property. (Utah Code Ann. § 59-2-1351.1.)

Once the county accepts the sale, the high bidder gets a tax deed (title) to your home. (Utah Code Ann. § 59-2-1351.1.) If no one bids on the home or bids a sufficient amount, the county gets title to the property. (Utah Code Ann. § 59-2-1351.3.)

Notice You'll Receive Before a Property Tax Sale in Utah

Before the sale, the county must send you a notice in the mail. (Utah Code Ann. § 59-2-1351.)

It must also publish the notice on the internet and in a newspaper for four weeks or post the notice in five public places if your area doesn't have a newspaper. (Utah Code Ann. § 59-2-1351.)

How to Stop a Utah Property Tax Sale By Paying the Delinquent Amounts

You can stop the sale by paying the delinquent taxes, tax notice charges, interest, penalties, and administrative costs before the sale. (Utah Code Ann. § 59-2-1346.)

Paying the overdue amount to stop the sale is called "redeeming" the property.

Can I Get My Home Back After a Utah Tax Sale?

If you live in Utah and the county sells your home at a tax sale because you didn't pay your property taxes, you can't get your home back after the sale by redeeming it.

Some states have a law that gives a specified amount of time (called a "redemption period") during which homeowners can reclaim their home after a tax sale by paying the overdue taxes or reimbursing the purchaser for the amount paid at the sale. But Utah doesn't have a post-sale redemption period. (Utah Code Ann. §§ 59-2-1346, 59-2-1351.1.)

What Happens After a Utah Tax Sale?

Following the sale, the high bidder (or the county if no one bids on the home at the auction) will get a deed (title) to your home. (Utah Code Ann. § 59-2-1351.1.)

Again, you have plenty of time to pay the delinquent amounts before the tax sale occurs. And you might be able to get an adjustment or deferral of owed taxes.

How to Avoid Losing Your Utah Home to a Property Tax Sale

Under Utah law, you can apply to the county legislative body before the sale to get:

• an adjustment (the county agrees to accept less than the full amount due to settle the debt), or
• a deferral of the owed taxes. (A "deferral" means you'll have to pay the taxes sometime later.)

If the county agrees to defer the overdue taxes, the deferred amount is recorded as a lien on the home. The amount will accrue interest at a rate of the lesser of:

• 6%, or
• the federal funds rate that the Federal Open Markets Committee established on January 1 immediately preceding the deferral date. (Utah Code Ann. § 59-2-1347.)

What Happens to My Mortgage in a Tax Sale?

Because a property tax lien has priority, mortgages (and deeds of trust) get wiped out if you lose your home through a tax sale process. So, If your loan isn't escrowed and you fail to pay the property taxes like you're supposed to, the loan servicer will usually advance money to pay delinquent property taxes to prevent a tax sale from happening.

Most mortgages have a clause allowing the lender to add the amount it paid to bring the taxes current to your loan balance. You'll then have to make repayment arrangements with the servicer or potentially face a foreclosure.

What Options Do I Have If I Can't Afford to Pay My Property Taxes in Utah?

If you're having trouble paying your property taxes, you might be able to reduce your tax bill or get extra time to pay.

Getting Help

Talk to a foreclosure, tax, or real estate lawyer if you're facing a tax sale in Utah and have questions about the process.

To learn more about property taxes and other aspects of homeownership, get Nolo's Essential Guide to Buying Your First Home by Ilona Bray, J.D., Attorney Ann O'Connell, and Marcia Stewart.