Property tax foreclosure in Indiana

The property tax process in Indiana, step by step

1. Late taxes and penalties

   The day after each due date on your tax bill

   If an installment is not paid on time, a 5% penalty applies if you pay within 30 days and owe no earlier delinquent taxes; otherwise the penalty is 10%. In each later year another 10% of the unpaid tax is added after each installment due date.

   Ind. Code § 6-1.1-37-10

2. Your home is put on the tax sale list

   When taxes from the prior year's spring installment or earlier are still unpaid

   The county treasurer certifies a property for the tax sale when more than $25 in taxes, penalties and fees from the prior year's spring installment or earlier remain unpaid. The county auditor must mail you a notice by certified and first-class mail at least 21 days before the county asks the court for a judgment and order for sale. Paying the full amount before the sale takes the home off the list.

   Ind. Code §§ 6-1.1-24-1, 6-1.1-24-4

3. The tax sale

   At the county's tax sale

   The county sells a tax sale certificate on your home at public auction to the highest bidder. You still own and can live in the home during the redemption period. Homes that do not sell can go to the county executive, which can shorten your time to redeem to 120 days.

   Ind. Code §§ 6-1.1-24, 6-1.1-25-4

4. Redeem within 1 year

   1 year after the sale in most cases; 120 days in some county-held cases

   To redeem, you pay 110% of the minimum bid if you redeem within 6 months, or 115% after that, plus 5% a year on any amount bid above the minimum, plus later taxes and certain costs the buyer paid. If you make a payment agreement with the county treasurer before your time runs out, the treasurer may extend the redemption period, generally for 1 year from the agreement. Ask the county auditor for the exact amount before you pay.

   Ind. Code §§ 6-1.1-25-2, 6-1.1-25-4

5. Notice and petition for tax deed

   After the sale and before the buyer can get a deed

   The buyer must send you a notice by certified mail giving the date a petition for tax deed will be filed, how to redeem, the date your redemption period ends, and that the owner when the deed is issued may have a right to tax sale surplus. The buyer then asks the court for an order to issue the tax deed. If you have not redeemed and notice was proper, the court can order the county auditor to issue the deed.

   Ind. Code §§ 6-1.1-25-4.5, 6-1.1-25-4.6

6. Claim the tax sale surplus

   Within 3 years after the money is received

   Indiana already returned tax sale surplus before Tyler v. Hennepin County (2023): the amount bid above the taxes and costs goes into the county's tax sale surplus fund. The owner of record who loses the home when the tax deed issues files a verified claim with the county auditor, and the auditor issues a warrant if the auditor and treasurer approve it. Money not claimed within 3 years moves to the county general fund and cannot be paid out.

   Ind. Code §§ 6-1.1-24-6.4, 6-1.1-24-7

7. Limits on surplus recovery deals

   Before you sign anything

   An agreement to pay someone to recover your tax sale surplus is valid only if it is in writing, signed by you, states the surplus amount and what you get after the fee, and charges no more than 10% of what is collected. The Indiana Attorney General enforces this cap. Never sign over your surplus rights for a quick cash payment.

   Ind. Code § 6-1.1-24-7.5

Common questions in Indiana