Leesburg, VA asked in Bankruptcy for Idaho

Q: Are older real estate property tax debts without a Leon discharged in chapter 7 in Idaho?

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1 Lawyer Answer
Kevin M Rogers
Kevin M Rogers
  • Bankruptcy Lawyer
  • Boise, ID
  • Licensed in Idaho

A: Whether the property has a loan or not is not the question. The Bankruptcy Court will NOT determine if a tax debt for property is "dischargeable" or not. Your bankruptcy attorney will do that and advise you. Section 502(c) says:

(C) the amount or legality of any amount arising in connection with an ad valorem tax on real or personal property of the estate, if the applicable period for contesting or redetermining that amount under applicable non-bankruptcy law has expired.

This means that in some cases, old property tax debts are assumed to possibly be dischargeable in "non-bankruptcy" law cases. There is no law in Idaho that permits you getting rid of old ad valorem or "property tax" debts. Idaho Code 63-1101 sets out Idaho's treatment for delinquent property taxes:

63-1101. SEIZURE OF PROPERTY FOR REFUSAL TO PAY PROPERTY TAX — DUTY OF TAX COLLECTOR. In case any person refuses to pay the property tax levied on any personal property belonging to him when demanded by the tax collector, the tax collector shall direct the sheriff to seize and sell as much of the personal property or any other property of the person as will be sufficient to pay the property taxes, late charges, interest, costs and expenses accruing thereon, as estimated by the tax collector.

So, if this is a property you are buying, the property tax delinquency will be paid before any proceeds are distributed. If you purchase this property at an auction, all property tax debts and other liens will be paid before you purchase it. If this is property you already own, then you're in trouble and need to obtain a loan and pay off the old property tax burden or risk losing your property.

Good luck to you!

Timothy Denison agrees with this answer

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