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  • Property taxes are a requirement in most jurisdictions when you own property. Regardless of whether it's a home, a warehouse or a business office, property taxes will be due twice a year to your county and maybe your city, depending on the location. And, if they are not paid, the local government can put a lien on the location and force a sale after waiting long enough. So, it's wise to keep the taxes paid. However, if you're having trouble paying timely, there are some steps you can take.

    Delay Payment

    You do have the option in most jurisdictions to delay payment of your taxes. There is a penalty, however. Many local government charge anywhere from 2 percent to 10 percent of the amount owed as a penalty for paying late. That said, if you're off a few months, it's better to pay late than not at all. So, in that situation, you can consider it a loan by the local government and the penalty is the interest charge for the delay until your cash flow is ready.

    Use Tax Refund

    Don't forget that most people generally have some kind of a tax refund due from their income taxes in April through June, depending when they file to the Internal Revenue Service and their state. This can be thousands of dollars depending on your income situation. The lump sum amount can be enough or more than sufficient to pay your taxes without having any further cost out of pocket.

    Use Credit Card

    Many jurisdictions will gladly take your credit card as a payment vehicle for property taxes owed. And, many credit card companies will allow it, since they make a nice transaction fee off the amount. The cost to you will likely be a fee of 2 percent to 5 percent of the taxes owed since the local government doesn't want to pay the fee themselves. In comparison, however, this is still cheaper as a fee than taking a late payment penalty. That said, keep in mind that your credit card will start the interest charge on the amount paid within 25 to 30 days in the billing cycle. Then the interest charge could be a lot more than you bargained for. So consider the credit card as a very short-term cash flow loan, or as an electronic means of payment if you can't mail or pay your taxes in person (i.e. you're out of the country).

    Borrow from Family or Friends

    If your taxes owed are small enough, your family or close friends may entertain lending you the funds for a short-time. Keep in mind that you risk fouling your relationship with them if you don't pay them back timely, so make sure to do so. Family members especially can remember being burned by a relative for years after the fact, even if eventually rectified. And they won't hesitate to bring it up every time there is a family meeting or event.

    Get Extension

    Some tax districts will provide the option of a tax payment extension, although this is rare. Most just charge a late payment penalty. However, it doesn't hurt to ask or research, and filing one could save you being charged interest with some of the options above if an extension is available.

    Are you Paying Right Amount?

    If you ask early enough in the year, your county assessor can reevaluate your property tax and determine if it's correct. Many times, especially during market downturns, the property tax charged should be lower than it is. Lowering yours could bring it down low enough to be affordable again if you can make a partial payment. Remember though you need to ask for an assessment reevaluation early. These reviews take a few months and assessors won't do them 24 hours before your tax payment is due.

    Source:

    Community Legal Resources: Property Tax Help for Low-Income Homeowners

    Need Help Paying Bills: How To Get Help with Paying Property Tax Bills, and How to Challenge Property Taxes

    More Information:

    State Tax Central

    PropertyTax.com

    LowTaxRate.com

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