If you become delinquent in paying your property taxes in some parts of Kentucky, the tax collector can file a lawsuit to foreclose the tax lien that exists on the home and sell the home at a foreclosure sale to collect the unpaid taxes. In other parts of the state, the tax lien itself is sold and the purchaser gets a tax lien certificate. After some time passes, the certificate purchaser can foreclose and the home will be sold at a foreclosure sale.
Either way, you’ll get a certain amount of time either before or, in some cases, after the foreclosure sale in which you can pay off the debt and thereby keep your home. However, if you fail to do so, you’ll eventually lose ownership of your home. Read on to learn more about what happens if you don’t pay your property taxes in Kentucky and how you can avoid losing your home if you do get behind in your property taxes.
When you don’t pay your property taxes in Kentucky, the overdue amount becomes what's called a "lien" on your home. (A lien is a legal claim against the property.) (If you are struggling to pay your property taxes, learn about your options to avoid a tax sale.)
In some places in Kentucky, if you don’t pay your property taxes, the collector can file a lawsuit in court to enforce the tax lien. The home is typically sold at a public auction as part of the process (Ky. Rev. Stat. Ann. § 91.487). When the court confirms the sale, which happens after the redemption period (see below), the purchaser from the sale gets a deed (title) to the property and becomes the new owner (Ky. Rev. Stat. Ann. § 91.514).
Notice of a tax lien foreclosure. The collector must mail you a notice within 30 days after filing the suit (Ky. Rev. Stat. Ann. § 91.4884). Notice about the action will also be published in a newspaper (Ky. Rev. Stat. Ann. § 91.4883).
Redemption period takes place before the foreclosure sale. Kentucky law gives you some time to pay off the tax debt and keep your home. This is called a “redemption period.” With a Kentucky tax lien foreclosure, the redemption period takes place before the public sale. This means you get the right to pay off the debt (redeem) the property at any time before the foreclosure sale takes place (Ky. Rev. Stat. Ann. § § 91.4884, 91.511).
When you can redeem after the sale. You will also get some time to redeem after the sale takes place if the purchase price at the sale is less than the property’s assessed value (Ky. Rev. Stat. Ann. § § 91.4884, 91.511). (Learn more in Getting Your Home Back After a Property Tax Sale in Kentucky.)
If you don’t pay your property taxes in other parts of Kentucky, the county clerk may sell the tax lien that exists on the home (Ky. Rev. Stat. Ann. § 134.128). The purchaser buys a tax lien certificate (a “certificate of delinquency”) at the sale and can eventually foreclose on the home to collect the amounts due. As part of the foreclosure process, the property is sold at a foreclosure sale (Ky. Rev. Stat. Ann. § § 134.546, 134.549).
Notice of a tax lien certificate sale. Two notices of the delinquency are mailed to you before the certificate sale (Ky. Rev. Stat. Ann. § 134.504). Notice about the certificate sale is also published in a newspaper (Ky. Rev. Stat. Ann. § 134.128). After the certificate sale, the purchaser who bought the certificate must mail you a notice within 50 days (Ky. Rev. Stat. Ann. § 134.490).
Notice of foreclosure. If the third party, state, county, or taxing district gets the certificate and later decides to foreclose, notice must be mailed to you within 45 days before starting the foreclosure (Ky. Rev. Stat. Ann. § 134.490).
Redemption period. The purchaser cannot start a lawsuit to foreclose until one year after the date the taxes became delinquent (Ky. Rev. Stat. Ann. § 134.546). This one-year period is the redemption period. You can redeem the home during this time.
In some cases, you can redeem the home after the foreclosure sale. You can redeem the home within six months after the foreclosure sale, but only if the property sold for less than two-thirds of its appraised value at the sale (Ky. Rev. Stat. Ann. § § 134.546, 426.530).
To locate Kentucky’s tax sale laws, go to § § 91.420 through 91.610 and 134.010 through 134.990 of the Kentucky Revised Statutes. You can find the Kentucky Revised Statutes on the Kentucky Legislature’s website atwww.lrc.ky.gov/statutes. (If you need help finding the statutes, see Nolo’s Legal Research FAQs & Basic Info area.)