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Tax Information and Procedures

 

This document was prepared to provide relevant information regarding the annual Prince George’s County Tax Sale and the legal requirements of the County as well as the purchaser of a tax sale certificate.  Legal references herein refer to the Tax Property Article of the Annotated Code of Maryland.

 

Liens on properties offered at the 2014 Prince George’s County Tax Sale are subject to the following procedures.  The County shall offer lien certificates on individual properties via an Internet-based, sealed (direct) bid auction using the high bid premium method as provided for in the Annotated Code of Maryland, Tax Property Article §14-817(b)(2) et. seq.

 

TAX INFORMATION

 

Ordinary taxes, which include taxes on real property, are due and payable without interest as of the first day of July in each taxable year.  Under the annual payment schedule, the taxes are overdue and in arrears on the first day of the succeeding October.  Under the semiannual payment schedule, the first installment becomes delinquent as of October 1st and the second installment becomes delinquent as of January 1st.  Interest accrues at the rate of one and two-thirds percent (1-2/3%) per month or any fraction of a month until paid (Section 14-603 and Section 14-703).  Interest charges are posted on the first day of each month beginning October 1st until paid.

 

Any unpaid, State, County and city taxes on real property constitute a lien on the real property from the date they become due until paid (Section 14-804).

 

It is mandatory that the Collector of Taxes sell, at the time prescribed by local law, any property on which taxes are in arrears (Section 14-808).

 

Thirty days or more prior to the date property is first advertised for tax sale in a newspaper, the Collector is required to mail a statement to the person who last appears as owner on the Collector’s tax rolls. The statement contains the owner’s name, the amount of taxes due and a notice that if the taxes are not paid, the property must be sold.  For this purpose, Prince George's County prepares delinquent tax bills to which the required notice is attached (Section 14-812).

 

The Collector will publish, once a week for four successive weeks, a listing of the delinquent properties in one or more newspapers.  This advertisement serves as notice to the property owners, and any lien holders, that the property is to be sold.  The advertisement will contain the date, time and place of the sale, as well as a description of the property, name of person who last appears on the Collector’s tax roll as the owner, the assessed value of the property as determined by the last assessment and the tax sale amount.  The tax sale amount advertised includes, or may include, the delinquent taxes (State, County and Municipal, where applicable), interest from October of the levy year through the month of sale, trash & garbage charges, special improvement assessments (total unpaid), front foot benefit charges, tax liens, etc.  An advertising fee of $30.00 is also included in the total.  The list of delinquent properties may also be found on the tax sale website https://taxsale.princegeorgescountymd.gov.

 

During the newspaper advertising period, April 17th through May 8th, properties will be removed from the list as payments are received from taxpayers.  Therefore, the final newspaper advertisement on May 8th will list fewer properties than were originally advertised.  The website will also be updated weekly.  The final update on the tax sale website will occur after 4:30 p.m. on Friday, May 9th.  There will be a notation on the website indicating that the final update has been completed.

 

THE TAX SALE

 

Each parcel of property offered at tax sale will be sold as an entirety (Section 14-814).  No property will be sold for a sum less than the advertised price.  When sold, the County’s lien on the property passes to the bidder/purchaser (Section 14-817).

  

ALL TAX SALE BIDDERS ARE SUBJECT TO THE FOLLOWING STEPS PRIOR TO BEING PERMITTED TO BID IN THE AUCTION:

 

  1. Register on-line at the tax sale website: https://taxsale.princegeorgescountymd.gov
  2. No mail-in or email registrations will be accepted.  On-line registration will begin on April 10th, 2014 and will end May 2, 2014.  All steps in the bidder registration process must be completed by 5:00 p.m. EST. on May 2nd.  A confirmation email will be sent to each registrant and will include a bidder number.
  3. Pay $150.00 registration fee via ACH Debit.  The registration fee is non-refundable and will not be applied to the amount owed for certificates.  Payment in USD (United States Dollars) is required. 
  4. Enter a valid bank account from which your registration fee will be debited.  All bidders are required to monitor their auction account to ensure funds for all successful bids are available for payment at the close of the auction. 
  5. Monitor their auction account to ensure funds for all successful bids are available for payment at the close of the auction. 
  6. Accept all terms in the “Tax Sale Information and Procedures” and the “Bidding Rules”.

 All bids shall be submitted on the website.  Bids can be submitted beginning May 5, 2014.  Certificates will be awarded to the highest bidder on May 12, 2014 in accordance with the batch listings that will be posted on the website.  Batches are subgroups of the advertised list of properties that serve as a means of organizing tax certificates for the purpose of facilitating bid submission.  Each tax certificate in each batch is offered independently of every other tax certificate in that batch.  A unique closing time is established for each batch.

 

Certificates will be grouped into three batches and each auction account will be awarded to the highest bidder. The first batch will close at 9:00 a.m. EST. The second batch will close at 12:00 p.m.. EST. The third batch will close at 3:00 p.m. EST.   Acceptance of bids for the final batch ends at 3:00 p.m. EST.

 

Bids may be submitted as a dollar value or in the form of a bid factor (a percentage of the assessed value).  For example, a bid factor of .46 would indicate that the bidder is bidding .46 times the assessed value of the property.   

 

All bids must be made in good faith.  All bids placed, whether intentional or not, are the responsibility of the bidder and may not be withdrawn. Should a successful bidder not make full payment for any or all of the certificates that are awarded in the tax sale, including any associated High Bid Premium, they will not be awarded any certificates and they may be prohibited from participating in future tax sales.  The certificates will be awarded to the next highest bidder.  All bidders are required to monitor their auction account to ensure funds for successful bids are available for payment at the close of the auction.

 

Each successful bidder will receive an invoice via email by 5:00 p.m. (EST) on the day of the tax sale.  Guaranteed funds in the form of wire transfer, cash, or cashier’s check must be received for payment of the total amount of awarded bids, plus any associated high bid premium.  Cash or cashier’s checks must be delivered to the Prince George’s County Office of Finance at 14741 Governor Oden Bowie Drive Suite 1090 Upper Marlboro, MD by 3:00 p.m. (EST) the day following the tax sale.  Wire transfers must be sent according to the instructions provided in the invoice, and must be received in the County’s bank account by 3:00 p.m. (EST) the day following the tax sale.   The County will send an e-mail confirmation acknowledging receipt of the wire transfer.

        

Pursuant to Tax Property Article 14-817(b), the County has established a high bid premium for all certificates sold at tax sale.  This high bid premium is 20% of the amount by which the bid exceeds 40% of the property’s assessed value. The high bid premium is due and payable at the time the successful bidder pays the tax lien amount. The County will confirm with its bank the receipt of the payment.

 

Successful Bidders are required to complete and return the IRS form W-9, Request for Taxpayer Identification Number and Certification.

The County will provide tax sale purchasers with IRS form 1099-INT Interest Income paid, as required by law.

 

HIGH BID PREMIUM

 

The County will refund the high bid premium, without interest, to the holder of the tax sale certificate upon redemption of the property or to the plaintiff in an action to foreclose the right of redemption upon delivery of a tax sale deed for the property for which the high bid premium was paid.  The high bid premium is not refundable after the time required (under Section 14-833 of the Tax-Property Article) for the filing of action to foreclose the right of redemption, if there has been no redemption and if an action to foreclose the right of redemption has not been filed within that time.  In addition the high bid premium will not be refunded in the event a tax sale foreclosure suit is dismissed and there has been no redemption.

 

EXAMPLE #1

EXAMPLE #2

 

Assessed Value

$118,000

 

Assessed Value

$100,000

Bid Factor

x 0.46

Bid Factor

x 0.50

Bid

= 54,280

Bid

= 50,000

40% of Assessed Value

47,200

40% of Assessed

Value

40,000

Premium

= 7,080

Premium

= 10,000

20% of Premium

x .20

20% of Premium

x .20

Premium

= 1,416

Premium

= 2,000

Taxes

$ 1,299

Taxes

$ 2,000

High Bid Premium

+ 1,416

High Bid Premium

+ 2,000

Total Due

= $2,715

Total Due

= $ 4,000

 

THE CERTIFICATE OF TAX SALE

 

After six months from the date of sale, the Collector will deliver to the purchaser a certificate of sale.  The certificate sets forth the fact that the property described therein was sold by the Collector to the purchaser, the date of sale, the amount bid, the advertised amount and the annual interest rate payable upon redemption.  The certificate is null and void if an action to foreclose the right of redemption is not instituted by the holder within two (2) years from the date of sale.  If a certificate is void, then the interest of the holder of the certificate of sale ceases (Section 14-833).

 

Any certificate of sale, properly executed, is assignable upon notification to the Treasury Division and the assignment vests in the assignee, all the rights, title and interest of the original purchaser (Section 14-821).

 

The certificate of sale is presumptive evidence in all courts, in all proceedings by and against the purchaser, of the truth of the statement therein, and of the title of the purchaser to the property (Section 14-823).

 

The certificate of sale may be recorded among the land records of the County.  However, failure to record does not in any manner affect the right to institute foreclosure proceedings within the time limits prescribed (Section 14-822).

  

REDEMPTION – PRIOR TO COMPLAINT

 

The owner or other person having an estate or interest in the property sold has the right to redeem the property at any time until the right of redemption is finally foreclosed by an order of the Circuit Court (Section 14-827).

 

To redeem a property, taxes must be paid ­ONLY TO THE TAX COLLECTOR:

 

(1)   the total tax sale price of the property and

(2)   any taxes, interest and penalties accruing after the date of the tax sale

 

Payment must be made by certified check, cashier’s check, mortgage company check, money order, cash or credit card.  Credit card payments must be processed in the Treasurer’s Office (cannot be made over the phone). 

 

The rate of interest is set under Section 14-820 and is computed from the date of the tax sale to the date of the redemption payment (Section 14-828).  The interest rate, as stated on the certificate of sale, is twenty percent (20%) per annum.

 

During the first four months after the date of the tax sale, auctioned properties may be redeemed without payment of legal fees.  After the expiration of the four-month period, if the holder of the certificate, or his/her representative, has notified the Treasury Division (in writing) that legal fees have been incurred, a release is required, in addition to the redemption amount.

 

REDEMPTION – AFTER COMPLAINT

 

On redemption, the plaintiff or the holder of the certificate of sale may be reimbursed for attorney’s fees and expenses incurred in any action or in preparation for any action to foreclose the right of redemption as specifically provided in Section 14-843 of the Tax Property Article.

 

Upon receipt of the redemption amount and attorney’s release/dismissal (if required), the Collector will reimburse the holder of the certificate (Section 14-828).

 

If an action by the purchaser to foreclose the right of redemption has been filed and there is a dispute regarding redemption, an order of the Court is required (Section 14-829).                                                        

 

ACTIONS TO FORECLOSE

 

The holder of a certificate of sale may at any time after the expiration of six months from the date of sale, file a complaint in the Circuit Court to foreclose all rights of redemption of the property to which such certificate relates.  If such action is not taken within a two-year period subsequent to sale, the certificate is null and void (Section 14-833).  The plaintiff must forward a copy of the complaint to the Treasury Division.

 

The certificate of sale must be attached and made a part of the complaint (Section 14-835).

 

The plaintiff in any action to foreclose the right of redemption must be the holder of the certificate of sale.

 

The defendants in the proceedings must be (a) record owner(s) of the property, (b) owner of ground rents, if applicable, (c) mortgage holders and trustees under any deed of trust, (d) the State of Maryland, if appropriate, and (e) the County (Section 14-836).

 

If the court enters a final judgment for the plaintiff, the judgment must vest in the plaintiff an absolute and indefeasible title in fee simple.  If the property sold was subject to ground rent, the judgment must vest a leasehold interest in the plaintiff (Section 14-844).

 

The final judgment of the Court will direct the Collector to execute a deed upon payment to the Collector of the balance of the purchaser price, together with all taxes, interest, penalty and charges accruing subsequent to the sale.  The deed is to be prepared by the holder of the certificate of sale or an attorney.  The Collector is not obligated to execute the deed until the clerk of the court has furnished the Collector with a certified copy of the judgment.  If the holder of the certificate does not comply with the terms of the final judgment within 90 days, the judgment may be stricken by the Court upon the motion of an interested party (Section 14-847).

 

Once a judgment is granted, the plaintiff becomes liable for taxes due after the judgment and for any surplus bid (Section 14-844).

 

Any person who acquired a deed to property under this subtitle is entitled to issuance of a writ for possession of the property under the Maryland Rules as if the person had obtained a judgment awarding possession of the property (Section 14-850).

 

 

 
 
 
All bids must be made in good faith. All bids placed, whether intentional or not, are the responsibility of the bidder and may not be withdrawn. Should a successful bidder not make full payment for any or all of the certificates that are awarded in the tax sale, including any associated High Bid Premium, they will not be awarded any certificates and they may be prohibited from participating in future tax sales. The certificates will be awarded to the next highest bidder. No budgets will be established for the purpose of determining the maximum amount allowable for the purchase of certificates. All bidders are required to monitor their auction account to ensure funds for successful bids are available for payment at the close of the auction.
 

© 2014 Prince George's County

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