A property tax lien is a lien or claim for money due to a federal, state, or local government for unpaid and delinquent taxes. For example, the federal government may place a lien on a homeowner’s home or other real property for unpaid federal income taxes, and state and local governments (often counties) may place a lien on real property for unpaid income or property taxes.

The federal, state, or local government entity—also known as a taxing authority—may seek to recover payment for unpaid taxes by forcing the sale of the property on which the lien is placed in the foreclosure process—a process in which the validity of the lien and satisfaction (payment) for the lien is litigated or determined in court.

In Indiana, a property tax lien represents a legal claim against a property for unpaid property taxes. When property taxes are delinquent, the county can place a lien on the property. This lien has priority over most other liens or claims on the property, including mortgages. If the taxes remain unpaid, the county may eventually sell the lien at a tax sale. Potential buyers can purchase these liens, paying the tax debt, and then have the right to collect the debt with interest from the property owner. If the owner fails to pay the debt within a redemption period, the lienholder can petition for a tax deed to obtain ownership of the property. The process for tax sales and redemption is governed by Indiana Code Title 6, Article 1.1, which outlines the procedures for notification, sale, redemption, and issuance of a tax deed. The federal government can also place a lien on property for unpaid federal taxes, and this process is governed by federal law, which allows the Internal Revenue Service (IRS) to place liens and eventually force the sale of the property to collect unpaid taxes.