Pub. 10 2019 Issue 1

Spring 2019 15 West Virginia Banker Step 4. Requirements for issuance of a tax deed W.Va. Code § 11A-3-19 [2018] Between May 1 and September 1 of the year following the sheriff's sale, the State Auditor sends to each tax lien purchaser the requirements that must be met to obtain a tax deed. No- tice is sent by first-class mail. § 11A-3-14 Failing to meet these requirements, the purchaser will lose all benefits of purchase. The requirements include: 1. After August 31 but before October 31 in the year follow- ing the sheriff's sale, the purchaser must prepare a list of persons entitled to receive a Notice to Redeem and request the State Auditor to prepare and serve notice to these persons pursuant to § 11A-3-21 and § 11A-3-22. This list is generally prepared by an attorney retained by the purchaser to complete a title examination. 2. If the real property subject to the tax lien purchased is Class II property, i.e., owner-occupied residential property or farm land used by the owner for agricultural purposes, the purchaser must provide the State Auditor the physical mailing address of the real property. 3. The purchaser must provide the State Auditor a list of expenses incurred after January 1 of the year following the sheriff's sale, including expenses for preparation of the list described in (1) above. 4. The purchaser must deposit with the State Auditor funds sufficient to cover the costs of preparing and serving the Notice to Redeem. 5. The purchaser must present to the State Auditor a copy of his or her Certificate of Sale. Recall our example from Part One, where the 2017 delinquent taxes were sold between October 14, 2018 and November 23, 2018. The purchaser must complete the above requirements prior to October 31, 2019, i.e., October 31 in the year following the sheriff's sale. Step 5. State Auditor to send notice to redeem W.Va. Code § 11A-3-21 [2010] and § 11A-3-22 [2013] The Notice to Redeem is served by the State Auditor by the 30th day following the request for notice by the purchaser. Section 11A-3-22 specifies how notice is to be served. If the real property subject to the tax lien sold is Class II property (see above), then the State Auditor forwards a copy of the notice by first class mail to the real property, addressed to "Occupant." The form and content of the Notice to Redeem is set out in § 11A-3-21. It provides the name of the purchaser; the date of sale; the taxes, interest and charges due on date of sale and through the date by which the property may be redeemed; and the date by which the property may be redeemed. Continuing with our 2017 delinquent tax example, the Notice to Redeem would be sent after September 30, 2019, but be- fore November 30, 2019. Debra Lee Allen is the co-chair of Spilman's Consumer Finance Practice Group. Her primary areas of practice are commercial finance litigation, general business litigation, bankruptcy, and loan workouts and commercial foreclosures. She can be reached at 304.291.7951 or dallen@spilmanlaw.com. Step 6. Issuance of the tax deed W.Va. Code § 11A-3-27 [2018] If the real property is not redeemed, then after April 1 of the second year following the sheriff's sale until expiration of the lien evidenced by the Certificate of Sale, the State Auditor shall, upon request of the purchaser, make and deliver to the Clerk of the County Commission, a quitclaim deed for the real estate. Recall § 11A-3-18 provides that the lien against the real property created by a Certificate of Sale expires 18 months after issuance of the Certificate of Sale. The tax purchaser's right to receive a tax deed is forfeited if the purchaser does not request the deed within the 18 month period. Hence, the purchaser must be diligent in watching the calendar. The State Auditor has 120 days from the date the deed is requested to execute and deliver the deed. The form and content of the tax deed is set out in § 11A-3-27. Redemption of Real Property after Sale of Tax Lien W.Va. Code § 11A-3-23 [2010] After sale of a tax lien, but prior to issuance of the tax deed, the owner of the real property or any person entitled to pay taxes on the real property (such as certain lienholders) may redeem the real property. The one redeeming must pay to the State Auditor all taxes paid by the tax purchaser, both at sale and after sale, plus expenses incurred in preparing the list of persons for notice (Step 4), with interest at 1% per annum. § 11A-3-23 [2010] Redemption must be accomplished prior to April 1 of the second year following the sale. 53 W.Va. Op.Atty.Gen. 89 (September 4, 1968) 1968 WL 94120. If the real property is redeemed, the State Auditor issues a Certificate of Redemption, which specifies the real property redeemed and the year(s) for which taxes were paid. It also in- cludes a statement that payment was received and the tax lien on the real property redeemed is released. § 11A-3-26 [2010] For our example involving 2017 delinquent taxes, redemption must occur prior to April 1 of 2020. The total redemption time, starting at the date of sheriff's sale, is approximately 18 months. Be sure to look for the next article in this series, in which we will discuss the grounds and timing for setting aside a tax sale, in the Summer 2019 issue of West Virginia Banker magazine.  1 See the Winter 2018 West Virginia Banker magazine for a discussion of Steps 1 through 3. Reference to Code sections are all to the West Virginia Code. Please refer to the specific Code section referenced for more detail and additional requirements that may exist at each step.