What Happens to the Property Taxes When a Homeowner Passes Away?


Who is responsible for paying taxes for a deceased person? The homeowner should clearly state who the responsible person is in their estate planning documents, as it will ease the burden of the loved ones they leave behind. Property tax is only one of the tax liabilities at death and becomes part of an estate like other debts such as car payments. Who might be nominated to pay the taxes, and what happens if one dies without a will?

Who is Responsible for the Property Taxes When Someone Passes Away?

Are you wondering who is responsible for property taxes after death? It all depends on what is written in the deceased person’s will or who inherits the property. Let’s discuss a few possibilities.

If a will exists, it normally includes a person named as executor who administers the estate; and the court appoints a legal representative if there is no will. Whether an executor or legal representative, they are responsible for paying the property taxes as long as the property is part of the estate. Property can also pass to heirs via state law without probate.

- A Trustee

Was the property held in trust when the owner passed? It is not part of the will or probate process, and a trustee is responsible for paying the property taxes, as per the trust documents, until the house passes to an heir.

- A Beneficiary

Has a beneficiary taking legal title to the home been named in the will? Until the legal title is transferred, the estate pays the property taxes. Thereafter, the new owner is responsible.

- An Heir

Did the person die without a will? They are deemed to have died “intestate,” and the court will dispose of the property, after paying all debts, by distributing it to the applicable relatives or “heirs.” Or, property can pass via the laws of intestacy without a court process with the filing of affidavits of heirship. In either case, the heirs are then responsible for paying the property taxes. As a property tax lender, we deal with these issues frequently and can help you as part of your loan process.

- The County the Property is Located in

What happens when a homeowner dies without a will, and there are no relatives close enough to qualify under the state’s intestate laws? The property will “escheat,” and the county where the property is located takes legal title to the home, subsequently becoming responsible for paying the property tax.

- What Happens with Mortgaged Properties?

If a property is mortgaged, the lender may require the homeowner to maintain an escrow account dedicated to paying property taxes. In this instance, the lender pays the taxes as long as the mortgage is paid. Did you know you cannot defer property taxes if you have a reverse mortgage?


Important Considerations to Keep in Mind

One of the first considerations to remember is when an estate does not have enough money to pay all the debts, including the property taxes, a court may order the house to be sold to make the payments. Homeowners, 65 years of age or older, and disabled persons can defer their property taxes until their estates are settled after death, based on Texas Tax Code, Section 33.06. A surviving spouse between the ages of 55 and 65 can apply for the deferral to continue, but the property taxes keep adding up, including interest and penalties. When the spouse also passes away, the estate must pay all deferred property tax debts. In these cases the heirs have only 180 days before collection actions begin to recoup the deferred taxes. Many property tax loan borrowers find themselves in this position and utilize a property tax lender to assist them in paying off this debt.

What to Do if You Have Inherited a Property With Delinquent Taxes?

Are you the legal heir to an estate and inherited property with delinquent taxes? Although not intended, unpaid taxes after death can be a burden, but there is a solution via a property tax loan. Selling the house won’t solve the problem, because all outstanding property taxes will be deducted from sale proceeds. .

We offer our clients an affordable, hassle-free way to ensure that your account with the local government tax office is paid in full and will work out a manageable repayment plan for you. AFIC can provide you with an instant quote by completing the form on our homepage. For qualifying properties, we can help you pay off your delinquent taxes and offer you the following benefits:

  • Quick and completely online process
  • No money down
  • No credit check
  • Free 30-day rate match
  • Match competitors and beat their rate by 1%
  • Avoid high penalties and foreclosure

We pride ourselves on finding solutions to suit the unique needs of our clients. If you would like to discuss our property tax loans, please contact our experienced team at AFIC today.

Ernest Eisenberg

Ernest Eisenberg, President of American Finance & Investment Co., Inc. (AFIC), brings a wealth of expertise in non-traditional financing, including property tax loans and non-bank mortgage solutions. His vision is characterized by a commitment to offering flexible financing solutions to Texas property owners.

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If you are over 64 or disabled, don’t get a property tax loan, contact your tax office about a deferral.

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