Disclaimer: This is not legal advice. It is for informational purposes only. Consult a licensed attorney in Alabama to address your specific situation.
Detailed Answer
In Alabama, county governments collect annual ad valorem property taxes under Title 40, Chapter 10 of the Code of Alabama. When taxes go unpaid, counties may declare them delinquent and sell a tax lien certificate or foreclose on the property.
To protect your property when you cannot pay taxes immediately, you can take the following steps:
- Request a Delinquent Tax Statement: Contact your county tax collector to obtain a payoff quote. Knowing the exact amount due—including penalties and costs—helps you explore options.
- Apply for an Installment Payment Plan: Under § 40-10-121, you may petition the county commission for an installment contract. If approved, you pay in monthly or quarterly installments plus interest. If you stay current under the plan, the county will not proceed with a tax sale.
- Claim Exemptions or Deferrals: Review homestead exemptions (§ 40-9-6 and § 40-9-8) and senior or disability deferral programs. Exemptions reduce your taxable assessment. Deferrals postpone payment until sale, transfer, or death, with interest accrued.
- Challenge Your Assessment: If you believe your property is over-assessed, file an appeal with the county board of equalization under § 40-2-25. A lower assessment reduces future taxes.
- Redeem After Tax Sale: If the county sells a tax lien or title under § 40-10-146, you have one year from the sale date to redeem by paying the purchaser the tax amount plus interest (2% per month), penalties, and costs. You may negotiate a redemption agreement if you cannot pay in a lump sum.
- Consider Bankruptcy Protection: Filing a bankruptcy petition (Chapter 7 or 13) can stay a pending tax sale. Note that tax debts remain due and you must resume payment or redemption before the stay lifts.
- Communicate Early: Maintain open lines with the tax collector and county commission. Prompt communication may unlock hardship accommodations or short-term extensions.
Helpful Hints
- Mark tax deadlines on your calendar as soon as statements arrive.
- Document all calls, emails, and letters to county officials.
- Check for local nonprofit or legal aid programs that assist with tax issues.
- Explore home equity loans or lines of credit as a last resort.
- Review all county commission meeting notices for installment-plan deadlines.
- Consult a real estate attorney before signing redemption agreements.