A Plain-English Glossary of Tax Sale Terms

Tax sales come with a vocabulary that mixes property law, tax administration and auction jargon, and the same word can mean different things in different states. What follows defines the terms you will meet most often, in plain English. Treat them as orientation, not as legal definitions for your state.

Terms about the debt

Delinquent — describes a tax account where payment was not made by the due date. Delinquency is the starting point of the entire process, described in what happens when property taxes go unpaid.

Penalty and interest — amounts statutes add to an unpaid tax bill over time. This is why the figure on a sale list is larger than the original tax and keeps moving.

Delinquency list — also tax sale list or advertised list. The published set of liens or parcels to be offered at a sale. See how to find your county’s list.

Terms about what is sold

Tax lien — a legal claim against a property for unpaid taxes.

Tax lien certificate — the document evidencing that you paid someone’s delinquent taxes and are owed that amount plus statutory interest. Explained in what is a tax lien certificate.

Tax deed — an instrument conveying a property sold for unpaid taxes. Generally carries none of the warranties of an ordinary deed.

Redeemable deed — a hybrid where the buyer receives a deed but the former owner keeps a statutory window to reclaim the property by paying the buyer back plus a penalty.

Lien state / deed state — informal labels for jurisdictions using each model. Useful shorthand, unreliable as a lookup — see lien states, deed states and hybrids.

Parcel / legal description — a defined unit of real property, and the survey-based description of its boundaries. For vacant land the legal description may be the only meaningful identification.

Terms about the auction

Upset bid / opening bid / minimum bid — the lowest amount the government will accept, usually tied to what it is owed plus costs. Terminology and calculation vary.

Premium — an amount bid above the delinquency. Whether it is refunded and whether it earns anything is statutory. See premium bidding.

Bid down — a format where bidders compete by accepting a lower interest rate. See bidding the interest down.

Rotational or random selection — allocation of liens by round-robin or lottery rather than competitive bidding.

Deposit — funds placed before the sale to qualify as a bidder; in online sales it often caps how much you may bid. Payment is usually by certified funds — cashier’s cheque or wire, not personal cheque, and never financed.

Struck off / no sale — a parcel that received no acceptable bid. Depending on jurisdiction it may go to the county, be re-offered, or be sold over the counter: bought from the county’s leftover inventory outside an auction, where allowed, on terms that vary widely.

The full sequence of a sale is set out in how a tax-sale auction works.

Terms about redemption

Redeem / redemption — the delinquent owner (or another eligible party) paying what statute requires to clear the delinquency and undo the sale’s effect.

Redemption period — the window in which redemption is allowed. Length and terms vary greatly and can vary within a state. See redemption periods explained.

Right of redemption — the legal entitlement to redeem, which may extend to lenders, heirs or other lienholders as well as the owner.

Subsequent taxes / subs — later years’ taxes that come due while a certificate is outstanding. Whether the holder may or must pay them, and how they are treated, is jurisdiction-specific.

Certificate expiry — the outer limit on how long a certificate remains enforceable. Letting it pass can forfeit the position entirely.

Terms about enforcement and title

Foreclosure (tax) — the legal process by which a certificate holder pursues the property after redemption fails. Judicial in some states, administrative in others. See what happens if a lien is never redeemed.

Priority — the order in which competing claims against a property are satisfied. Property tax claims commonly rank strongly, but not absolutely.

Encumbrance — any claim or restriction on a property: liens, easements, recorded covenants limiting how it may be used.

Easement — a right for someone else to use part of a property, such as a driveway or utility line. Generally runs with the land and survives transfers.

Quiet title — a court action asking a judge to confirm ownership and cut off competing claims. Often needed after a tax deed; see quiet title after a tax deed.

Marketable title — title clean enough that a reasonable buyer or insurer will accept it. Title insurance protects against defects in title; insurers are often cautious about tax deeds until title is cleared.

Notice — the statutorily required communication to owners and interested parties before a sale or foreclosure. Defective notice is a leading ground for challenging a sale.

Ejectment / eviction — legal proceedings to obtain possession from an occupant. See buying an occupied property.

Terms about money after the sale

Overage / surplus funds / excess proceeds — the amount a sale raises above what the government was owed, often claimable by lienholders or the former owner through a statutory process. See tax sale overages.

Escheat — the transfer of unclaimed funds to the state after a claim period lapses.

Assessed value — the value a county assigns for taxation. A tax figure, not an appraisal, and often a poor proxy for market value.

Two cautions about vocabulary

The same word can mean different things. “Upset bid,” “tax sale,” and even “redemption” carry jurisdiction-specific meanings, so never assume a term you learned about one state means the same in another. And a shared label hides real differences: two lien states can differ on rate, redemption period, bidding method, subsequent taxes and enforcement route. The vocabulary is a way into the statute, not a substitute for it.

If you are new to all of this, start with tax lien versus tax deed, then read your own county’s published sale terms — where these words acquire their actual local meanings.

This article is general education, not financial, investment, legal, or tax advice. Tax-sale rules vary by state and county and change over time — confirm the specifics with the relevant county office and consult a qualified professional before acting.