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Lev, Tax Advisor
Category: Tax
Satisfied Customers: 28081
Experience:  Taxes, Immigration, Labor Relations
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My mom bought a house in 2007. A bank owned property. Title

Customer Question

My mom bought a house in 2007. A bank owned property. Title was clear. Now the county says the property taxes were not assessed correctly during 2004-2006, and claim my mom will have to pay those back taxes because she now owns the property and the bank who owned it then is now insolvent.
Submitted: 7 years ago.
Category: Tax
Expert:  Lev replied 7 years ago.

When you mother purchased the property - she might purchased the title insurance - please verify...

The title company should be responsible for any additional tax obligations (including penalties and interest) if in-fact the title was not clear.


Customer: replied 7 years ago.
No she did not buy title insurance. She bought a title search but the additional property taxes were not added until last month. The county went back and said the assessment was in error when the bank owned the house, and the bank should have paid a higher tax rate.
Expert:  Lev replied 7 years ago.

If you mother did not purchase the title insurance - means - she took a risk for the situation that unfortunately happened - and in general - as the owner of the property - she is responsible for any tax liability related to that property.


If the title search provided incorrect information - I suggest to verify terms and condition for their service - and if they may be held responsible for damages.

Also it is possible that the county provided incorrect information to the bank and may also be held responsible till some extend.


But the situation is very different if she had a title insurance - and I afraid that she would need an attorney.