Technically, there are no tax lien certificates in Oklahoma, as there are in many other states. Certificates usually allow for a period of redemption after they're sold, and ownership of the property eventually transfers to the purchaser of the certificate if it isn’t redeemed. This option generally isn’t available in Oklahoma. The state will sell a property outright, not a certificate, when the owner owes delinquent taxes.
Is Oklahoma a Tax Lien State?
Ad valorem taxes and special assessments do form a lien against Oklahoma properties when they go unpaid, and the county treasurer will eventually sell the property to collect the taxes owed. Ad valorem simply means that they’re based on a property’s value.
This process is sometimes referred to as a certificate lien sale in some Oklahoma counties, even though no actual certificate is involved. But it’s just as often called a “tax sale.”
Tax Lien Sale in Oklahoma
An Oklahoma tax lien technically begins on the first day taxes are due. Property owners then have three years from this date to pay up, and taxes continue to accrue during this time because they’re an annual assessment. Interest and penalties will begin adding on as well.
The property will be sold at a public tax lien auction after three years if the total balance due, including interest and penalties, isn’t paid. This three-year period acts as something of a redemption period, but the property hasn’t actually been sold yet. The county simply maintains its tax lien against it during this time.
Tax lien certificates in other states are more or less an intermediary step in this process. Oklahoma counties go directly from “taxes due” to “tax lien auction” with no middleman or certificate involved. The deed to and ownership of the property is then transferred to whomever purchased the property at the county auction.
When Are Taxes Due?
The actual due date for property taxes might vary slightly from county to county, but tax statements are usually mailed out at the end of the year, sometime in November or December. You might have a little wiggle room from this point on, depending on the county in which your property is located.
For example, you must pay at least half the total amount due by the last day of December in Delaware County. You can then pay the balance by March 31, provided your entire bill is $25 or less. You don’t have the option to divide your payment in half in this case.
The penalty for not paying by these dates is 1.5 percent, although some counties don’t begin tacking on interest and penalties until 15 days have passed after the due date. The state places a cap on interest and penalties of 10 percent a year.
Redeeming House After Tax Sale
The majority of property owners can’t redeem their homes after a tax sale in Oklahoma, although they can do so during that initial three-year period before the sale takes place. Most owners are pretty much out of luck after the sale.
Oklahoma isn’t completely heartless when it comes to unpaid property taxes. The state does offer an exemption from sale for some residents, not to be confused with a right of redemption after the sale. These owners aren’t subject to the sale of their properties for unpaid property taxes in the first place.
Those who are age 65 or older qualify for an exemption in Oklahoma County, provided their incomes are less than the federal poverty guidelines and the fair market value of the property is $125,000 or less. They must actually live in the property in question. The home can’t be rented out. The same rules apply to 100 percent disabled individuals.
Some additional rules can apply in some areas. Your county’s population might also have to be 100,000 or less, and the property might have to include a home – it can’t be just farmland. And the exemption isn’t automatic. You must apply for it.
Check With Your County
These rules are admittedly complex, so call your county’s treasurer or tax assessor to be absolutely sure if you think you might qualify for an exemption. Remember that you must apply, so don’t sit back, thinking nothing can happen if you’re behind with paying your property taxes.
Beverly Bird has been writing professionally for over 30 years. She is also a paralegal, specializing in areas of personal finance, bankruptcy and estate law. She writes as the tax expert for The Balance.