Introduction

In Florida, unpaid property taxes set off a unique two-step process: the tax lien and the tax deed sale. Each stage carries serious consequences for homeowners and investors alike. Knowing how these steps work can help you protect your property and recover any surplus funds owed to you.

What Is a Tax Lien?

A tax lien is a legal claim placed on your property when property taxes are not paid. In Florida:

● Each year, unpaid property taxes become a lien.

● Counties auction these liens as tax lien certificates to investors.

● Investors pay the overdue taxes and earn interest until the lien is repaid.

👉Example: Imagine you owe $2,000 in property taxes. The county auctions off that lien, and an investor buys the tax lien certificate by paying the $2,000. You now owe that investor—not the county—and interest starts to build until you pay it back.

👉Key point: A tax lien does not mean you immediately lose your property. It means you owe the certificate holder, and interest continues to grow until you pay it back.

What Is a Tax Deed?

If a lien is not redeemed, the next step is a tax deed sale.

● After two years from the date a lien certificate is issued, the certificate holder can apply for a tax deed sale.

● The county then schedules an auction where the property itself is sold.

● The proceeds cover taxes, fees, and the lien holder’s claim.

👉Example: Let’s say your $2,000 lien isn’t paid for two years. The investor who bought your lien applies for a tax deed sale. At the auction, your home sells for $50,000. The county first uses that money to pay the $2,000 lien, interest, and court costs. If $40,000 remains after expenses, that money is considered surplus funds and may belong to you or your heirs.

👉 Key point: A tax deed sale transfers ownership of the property to a new buyer. However, if the property sells for more than the taxes owed, the extra money—known as surplus funds—may belong to the former owner or their heirs.

Why This Matters

Florida’s tax system can be confusing, but understanding it can make all the difference:

• You can redeem the lien at any point before the deed sale by paying off your taxes, interest, and fees.

• Families and heirs may not know they have a legal right to claim surplus funds after a tax deed sale.

• Missing deadlines could mean losing both the property and the money left over from the sale.

  👉Timeline Summary:

• Taxes unpaid = lien placed the same year.

• Lien certificate holders must wait 2 years before applying for a tax deed sale.

• Once the application is filed, the county schedules the auction (often within a few months).

Frequently Asked Questions About Florida Tax Liens and Tax Deeds

1. How long do I have to pay off a tax lien in Florida?
You can pay off a tax lien any time before the property is sold at a tax deed auction.

2. What happens if I don’t pay the tax lien?
If you don’t pay within two years, the investor holding the lien can request a tax deed sale. That means your property could be sold at auction.

3. Can I stop a tax deed sale once it’s scheduled?
Yes. You can stop it by paying all the back taxes, fees, and interest before the sale date.

4. What if my property sells for more than I owed?
If your property sells for more than the taxes owed, the extra money is called surplus funds. Those funds may belong to you or your heirs.

5. Who can claim surplus funds in Florida?
Usually, the former property owner or their heirs can claim surplus funds. In some cases, lien holders may also have rights to them.

6. How long do I have to claim surplus funds?
You need to file a claim within the deadline set by Florida law. If you wait too long, you could lose the money.

7. What happens if no one bids at a tax deed auction?
If no one bids, the property is moved to the county’s “lands available for taxes” list, where it can be purchased later.

Conclusion

A tax lien is the warning stage, while a tax deed sale is the final step. But even if the property is lost, it doesn’t always mean the money is gone too. Understanding Florida’s process—and the timelines that go with it—can help you protect your rights, avoid costly mistakes, and ensure that any surplus funds left after a sale end up where they belong: back in your hands or in the hands of your family.