If taxes on a property are not paid, they become a specific lien on the property. After a specified period, a tax sale at public auction is held. The tax collector issues a tax deed or quitclaim deed to the purchaser. States that allow the property owner a statutory period of redemption after the sale usually issue a certificate to the purchaser. A tax deed is not provided until the redemption period has expired.
Special assessments are also property liens that take precedence over other liens.
Special assessments include improvements that directly benefit a property, such as roads, sidewalks, and sewers. Assessments usually are made on the basis of road footage. Because special assessments are specific liens, nonpayment can result in a public sale of the property. Income Tax Losses from the sale of business or investment property can be used as deductions against other income, but a tax loss cannot be taken for the sale of a personal residence. All gains from the sale of property are taxable.