Florida law, for title research

Florida tax lien and tax deed sales: tax certificates first, then the clerk's tax deed auction, under chapter 197

Every rule below is quoted from the Florida Statutes or another official source, linked and checked on the date shown. General information, not legal advice.

Does Florida have tax lien sales or tax deed sales?

Both, one after the other. Section 197.432 of the Florida Statutes has the county tax collector sell tax certificates on parcels with unpaid taxes, in person or electronically. A certificate is a lien for the unpaid taxes, not the land: section 197.122 makes the tax a first lien superior to all other liens from January 1 of the tax year.

The land itself is sold later. Section 197.502 lets the certificateholder apply for a tax deed after 2 years have passed since April 1 of the year the certificate was issued, and section 197.542 then has the clerk of the circuit court sell the property at public auction to the highest bidder.

How does a Florida tax certificate auction work?

Bidders compete on interest, not price. Section 197.432(6) awards each certificate to the person who will pay the taxes, interest, costs and charges and demand the lowest rate of interest, bid in quarter-percent steps, and section 197.172(2) caps that rate at 18 percent a year. A certificate for less than 250 dollars on a homesteaded parcel is not auctioned; section 197.432(4) issues it to the county at the maximum rate, and section 197.432(6) strikes any certificate no one buys to the county at that rate.

A person may redeem at any time after the certificate issues and before a tax deed issues, unless full payment for the deed has already reached the clerk, by paying the face amount plus interest, costs and charges under section 197.472(1). Section 197.472(2) sets a mandatory minimum of 5 percent of the face amount when the interest earned is less, except on certificates with an interest rate bid of zero percent. A certificate on which no deed application or other proceeding of record has been made becomes void seven years after issuance under section 197.482, which does not apply to deferred payment tax certificates.

When can a Florida certificateholder apply for a tax deed?

The application can come after 2 years; the deed comes only after a sale. Section 197.502(1) lets the holder file the certificate and a tax deed application with the county tax collector at any time after 2 years have elapsed since April 1 of the year of issuance and before the certificate is canceled. The tax collector may charge a 75 dollar application fee and the cost of online application services.

Applying costs more than the fee. A holder other than the county pays, under section 197.502(2), at application the amounts for all other outstanding certificates and any omitted, delinquent and current taxes due, with interest, then the costs of bringing the property to sale. If those sale costs are not paid within 30 days after notice from the clerk, the tax collector cancels the application. Section 197.502(3) separately has the county apply on county-held certificates on property valued at 5,000 dollars or more, other than deferred payment certificates, and lets it apply on lower-valued property.

Homesteads cost more to take. The opening bid under section 197.502(6)(c) on property assessed as homestead on the latest roll adds one-half of its latest assessed value, and section 197.582(2)(a) treats that amount as surplus.

Who gets notice of a Florida tax deed sale?

The record decides. Section 197.502(4) has the tax collector give the clerk a statement of who is to be notified, and the list includes legal titleholders of record, lienholders and mortgagees of record, vendees under a contract for deed, lienholders who applied for notice, and the person assessed on the tax roll for the year last assessed. For submerged land or subdivision common elements it adds contiguous titleholders of record. Most of those entries depend on an address appearing as the section describes. To build the list, section 197.502(5)(a) has the tax collector contract with a title or abstract company for a property information report, and subsection (4) requires a direct and inverse search of the official records.

Section 197.502(5)(c) then has the clerk record a notice of the application, and a person acquiring an interest after that recording is deemed on notice of the pending sale. Section 197.512(1) has the clerk publish notice once a week for 4 consecutive weeks, with no sale until 30 days after the first publication. Section 197.522 has the clerk mail notice at least 20 days before the sale, unless no address is listed, and has the sheriff of the county where the legal titleholder resides notify that titleholder at least 20 days before the sale, by posting at the last known address if service cannot be made. A failure to receive the mailed notice, or the sheriff's inability to serve, does not affect the validity of the deed under that section.

How does a Florida tax deed sale work?

The clerk of the circuit court runs it at the published date, time and place, or online under section 197.542(4), which allows electronic sales with proxy bidding. The certificateholder's bid opens the auction: the redemption amount, costs, other certificates and interest at 1.5 percent per month from the month after the application through the month of sale. If no one bids higher, the property is struck off to the certificateholder, who under section 197.542(1) must pay within 30 days after the sale any amounts in the minimum bid not already paid, including documentary stamp tax, recording fees and, on a homestead, the one-half value.

A winning bidder posts a nonrefundable deposit of 5 percent of the bid or 200 dollars, whichever is greater, and must pay the balance with documentary stamp tax and recording fees within twenty-four hours, excluding weekends and legal holidays, or the clerk cancels the bids and readvertises. If there are no bidders and the certificateholder does not pay within 30 days after the sale, section 197.502(7) puts the land on a list of lands available for taxes. For the first 90 days the county may buy it for the opening bid or waive that right; after that any person, the county or another governmental unit may buy it from the clerk for the opening bid, without further notice. Three years after the day it was offered for sale, section 197.502(8) has the land escheat to the county free and clear.

What survives a Florida tax deed?

Less than a private sale leaves. Section 197.552 provides that, except as chapter 197 specifically provides, no right, interest, restriction or other covenant survives the deed, except a lien of record held by a municipal or county governmental unit, special district or community development district that is unsatisfied when the sale proceeds are disbursed. The deed is prima facie evidence of the regularity of the proceedings.

Two sections preserve more. Section 197.572 keeps the title subject to easements for conservation or for telephone, telegraph, pipeline, power transmission or other public service purposes, easements supporting improvements above the land, easements for drainage or for access to other land, and certain base buffering easements. To qualify, the easement must be in an instrument recorded before the tax deed or, for unrecorded public service, drainage and access easements, be evidenced by a visible occupation such as wires, a waterway or a road.

Section 197.573 covers the usual use restrictions, building restrictions and covenants against nuisances in a recorded instrument in the chain, which survive as they would against a voluntary grantee. It also protects a covenant providing an association lien for assessments accruing after the deed, or for satisfaction or survival of a municipal or county lien of record. It does not protect other covenants creating a debt or lien, or covenants requiring the grantee to spend money, except to keep the premises sanitary or sightly or to abate nuisances or undesirable conditions. All forfeitures, rights of reentry and reverter rights are destroyed.

What happens after a Florida tax deed issues?

The new owner is entitled to immediate possession under section 197.562 and, if refused, may apply to the circuit court for a writ of assistance on 5 days' notice. A sale may not be held invalid under section 197.122(1) except on proof that the property was not subject to taxation or was redeemed before the clerk received full payment for the deed.

Time limits apply as well. Section 95.192(1) bars an action by the former owner or a claimant under the former owner once a tax deed has been issued for 4 years, but under section 95.192(3) that bar does not apply if the legal owner in actual possession stays in possession for 1 year after issuance and before an ejectment action begins. Section 95.191 gives a former owner or adverse claimant 4 years after the deed holder goes into actual possession. If a challenge succeeds but the taxes were not paid before the deed issued, section 197.602 has the challenger reimburse the amount paid for the deed and the taxes, with 12 percent interest a year, the legal expenses of obtaining the deed, and the fair cash value of maintenance and permanent improvements. The prevailing party in a challenge is entitled to reasonable litigation expenses, including attorney fees. Whether a defect opens a particular deed is for a Florida attorney.

Surplus goes out under section 197.582(2): the clerk pays governmental units for their liens of record, then retains the balance for the persons entitled to notice, except contiguous titleholders, as their interests may appear, and mails them a notice. A person receiving it has 120 days from the notice date to file a claim. Except for a property owner, a person who misses that date is barred under subsection (5). If no claims arrive, subsection (9) presumes the legal titleholder of record is entitled to the funds, and they are processed under chapter 717.

Government liens have their own path. Under subsection (7), a holder of a recorded governmental lien, other than a federal government lien or ad valorem tax lien, must request disbursement within 120 days after the notice is mailed. Subsection (8) lets the tax deed recipient pay such liens directly and, on a timely claim with proof of payment, recover those amounts from the surplus. Within 90 days after the claim period, subsection (6) has the clerk either file an interpleader action or pay by priority of claims.

What a title search checks on a Florida tax deed parcel

Auction title research reads the chain of title, with images of the key instruments, reports the recorded easements and the liens of record it finds, including any held by municipal or county units, special districts and community development districts, and sets out the redemption rules in a plain-language summary. Whether a particular interest survives is a legal conclusion for a Florida attorney.

The Florida tax sale rules on this page, with their sources

Sources: Fla. Stat. 197.122, Lien of taxes; Fla. Stat. 197.432, Sale of tax certificates; Fla. Stat. 197.172, Interest rate; Fla. Stat. 197.472, Redemption of tax certificates; Fla. Stat. 197.482, Expiration of tax certificate; Fla. Stat. 197.502, Application for tax deed; Fla. Stat. 197.542, Sale at public auction; Fla. Stat. 197.552, Tax deeds; Fla. Stat. 197.573, Survival of restrictions and covenants; Fla. Stat. 197.562, Grantee entitled to immediate possession; Fla. Stat. 197.582, Disbursement of proceeds of sale; Fla. Stat. 197.512, Notice, form of publication; Fla. Stat. 197.522, Notice to owner; Fla. Stat. 197.572, Certain easements survive; Fla. Stat. 197.582, Disbursement of proceeds; Fla. Stat. 95.192, Limitation upon acting against tax deeds; Fla. Stat. 95.191, Limitations when tax deed holder in possession; Fla. Stat. 197.602, Reimbursement in challenges. Each row links the section it summarizes.

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