Esquire Asset Recovery, LLC
Esquire Asset Recovery, LLC
South Dakota Tax Lien and Tax Deed
What Happens If I Don't Pay Property Taxes in South Dakota?
| Judicial | Non Judicial | Comment | Process Period | Publish Sale | Redemption Period | Sale/NTS |
|---|---|---|---|---|---|---|
| Judicial only | 135 days | N/A | None | Court |
What happens if your South Dakota property taxes are delinquent? You might eventually lose your home.
People who own real property must pay property taxes. The government uses the money these taxes generate to pay for schools, public services, libraries, roads, parks, and the like. Typically, the tax amount is based on a property's assessed value.
When homeowners don't pay their property taxes, the overdue amount becomes a lien on the property. A lien effectively makes the property act as collateral for the debt. All states have laws that allow the local government to sell a home through a tax sale process to collect delinquent taxes.
So, if you don't pay your real property taxes in South Dakota, the county treasurer can sell the tax lien that exists on your home. You then get time (a few years) to pay off the overdue amounts and "redeem" the property. You'll eventually lose ownership of your home if you don't redeem it.
Is South Dakota a Tax Lien or a Tax Deed State?
Again, if you don't pay your property taxes, the past-due amount becomes a lien on your home. Each state has a different tax sale process to collect delinquent taxes.
Tax Deed States
In some states, the taxing authority sells the home if the homeowner doesn't pay off the debt. However, the purchaser might not get the deed to the property right away. Sometimes, a redemption period must expire before the buyer receives the deed.
Tax Lien States
In other states, the taxing authority sells the tax lien, and the purchaser must foreclose or use different procedures to get a deed to the property.
South Dakota is generally considered a tax lien state.
Tax Lien States
In other places, the taxing authority sells the tax lien. The buyer gets a tax lien certificate. The buyer may then try to collect the past-due taxes, plus interest, from the delinquent taxpayer. If the delinquent taxes aren't paid by a specific date, the lien buyer can usually get ownership of the property by foreclosing the lien or taking specific procedures to convert the certificate to a deed.
South Carolina is considered a tax lien state when it comes to delinquent property taxes. After a tax sale, the homeowner gets a redemption period to pay the unpaid taxes plus interest and reclaim their property. If the owner fails to redeem, the purchaser can acquire the deed to the property.
Other Tax Sale Procedures
And in certain states, a tax foreclosure process is used, or the taxing authority simply executes its lien by taking title to the home.
How Does South Dakota Handle Property Tax Non-Payment?
In South Dakota, the county may sell the tax lien at a public auction to a third party if the county allows this type of sale. (S.D. Codified Laws § 10-23-28.1 (2024).)
At the sale, the lien goes to the person who bids the full amount of the delinquent taxes, interest, and costs and bids the lowest rate of interest per year. (S.D. Codified Laws § 10-23-8 (2024).)
The Purchaser Gets a Certificate of Sale
The winning bidder from the sale then gets a certificate of sale (a tax certificate), subject to the right of redemption (see below). (S.D. Codified Laws § 10-23-8 (2024).) If no one bids the amount due, the county gets the certificate. (S.D. Codified Laws §§ 10-23-24, 10-23-25 (2024).) The county can later sell the certificate to a private party. (S.D. Codified Laws § 10-23-28 (2024).)
If you don't get current on the delinquent amounts, the winning bidder (the purchaser) or the county may eventually take legal action to get ownership of your home.
Notice of a Tax Lien Sale in South Dakota
At least 14 days before the sale, the county treasurer must send you a notice by first class mail or electronic means. (S.D. Codified Laws § 10-23-2.1 (2024).)
Notice is also published in a newspaper or, if the county doesn't have a newspaper, posted at the courthouse. (S.D. Codified Laws § 10-23-2 (2024).)
Look Out for Legal Changes
In this article, you'll find details on property tax sale laws in South Dakota, with citations to statutes so you can learn more. You can find South Dakota's property tax sale laws in Title 10, Chapters 23, 24, and 25 of the South Dakota Codified Laws.`47-
Statutes change, so checking them is always a good idea. How courts and agencies interpret and apply the law can also change. And some rules can even vary within a state. These are just some of the reasons to consider consulting an attorney if you're facing a tax sale.
Can I Get My Home Back After a South Dakota Tax Lien Sale?
After the tax certificate sale, you get three years, called a "redemption period," during which you can pay off the tax debt plus various other amounts. Redeeming the property prevents the purchaser or county from getting ownership of your home. (S.D. Codified Laws § 10-25-1 (2024).)
How a Tax Certificate Purchaser Gets Title to Your South Dakota Home
After the redemption period expires, the purchaser or county can begin the proceedings to get a tax deed (title) to your home. (S.D. Codified Laws § 10-25-1 (2024).)
You Then Get Another 60 Days to Redeem
To get the tax deed, the person or entity that bought the certificate at the sale (or the county) must personally serve you with a written notice of their intent to get a tax deed and giving you an additional 60 days to redeem. (S.D. Codified Laws §§ 10-25-2, 10-25-5 (2024).)
The additional redemption period expires 60 days from completed service, which happens when an affidavit of service is filed. (S.D. Codified Laws §§ 10-25-2, 10-25-8 (2024).) Immediately after the 60 days expires, the county treasurer issues and delivers the deed to the purchaser, the property's new owner. (S.D. Codified Laws §§ 10-25-8, 10-25-11 (2024).)
You can redeem at any time up until the county issues the tax deed. (S.D. Codified Laws §§ 10-24-1, 10-24-5 (2024).) If you don't redeem before this happens, you'll permanently lose ownership of your home.
How Much You'll Have to Pay to Redeem Your South Dakota Home
To redeem your home, you'll have to pay the county treasurer:
the sum listed in the tax certificate (the full amount of the taxes, interest, and costs)
interest at the rate the purchaser bid at the sale from the purchase date up to the date you redeem
all other taxes the purchaser paid for any previous year (or years) or after the sale, and
interest on the taxes from the date the purchaser paid them. (S.D. Codified Laws § 10-24-1 (2024).)
What Options Do I Have If I Can't Afford to Pay My Property Taxes in South Dakota?
If you're having trouble paying your property taxes, you might be able to reduce your tax bill or get extra time to pay.
Getting Help
Talk to a foreclosure lawyer, tax lawyer, or real estate lawyer if you're facing a tax sale in South Dakota and have questions about the process or need help redeeming your property.