Is South Carolina a Tax Deed State? (2024)

IS SOUTH CAROLINA A TAX DEED STATE? LET’S SEE!

Are you wondering, “Is South Carolina a tax deed state?” Each state has different rules, so it’s important to do your research! Is South Carolina a tax lien or tax deed state? Find out!

It seems that no two states have the same rules for the buyers of tax liens and tax deeds.

As you’ll discover today, South Carolina is very different from Georgia on the southern border, and it’s uniquely different compared to North Carolina on its northern border.

Today I’m going to answer your question, “Is South Carolina a tax deed state?”

Unlike North Carolina, which is a tax deed state, South Carolina has enacted legislation requiring the counties to sell tax liens. South Carolina is a tax lien state.

So to answer the question: is South Carolina a tax deed state? The answer is no. Most investors will recognize that South Carolina will auction tax lien certificates on defaulted properties.

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IS SOUTH CAROLINA A TAX DEED STATE? – TAX LIENS VS TAX DEEDS

So, what is the difference between a tax lien and a tax deed state?

Briefly, the United States is divided into over 3,000 separate counties and then further sectioned into 1,400 township/municipal governments. These are all separate taxing jurisdictions.

The state legislature is the governing body and creates the rules, laws, and the detailed processes that govern the state.

All of the state governments have enacted laws and rules to collect property taxes.

IS SOUTH CAROLINA A TAX DEED STATE? – PROPERTY TAXES

In the United States, everyone is allowed to own property and use that property to build a home or raise cattle, or maybe subdivide it into small parcels and build a house or houses, or for dozens of other uses.

However, ownership of property brings with it the responsibility to pay property taxes and pay your share of the local government services.

IS SOUTH CAROLINA A TAX DEED STATE? – DELINQUENT PROPERTY TAXES

Approximately half of the state governments elected have chosen to use rules which require almost immediate seizure of the property if property taxes are delinquent and defaulted upon. These are tax deed states.

IS SOUTH CAROLINA A TAX DEED STATE? – TAX LIENS

South Carolina is a tax lien state. Property owners who fail to pay property taxes will receive a notice of default. Basically, they will receive numerous due process of law notices which explain the consequences of nonpayment of property tax.

I regularly say the state is benevolent because the county officials, that is the treasurer and the tax collectors, do not evict or otherwise remove the property owner from the property once they’re on the South Carolina delinquent tax list. The owner remains on the property during the default/redemption period.

Tax lien buyers in South Carolina do not receive immediate possession of tax lien properties. South Carolina buyers of tax liens will purchase at a public auction.

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IS SOUTH CAROLINA A TAX DEED STATE? – TAX LIEN CERTIFICATES

The tax lien certificate will give the buyer ownership rights after a certain number of very specific days during which the property owner fails to pay. That period is one year.

In South Carolina the county officials are authorized to issue tax lien certificates which are sold at auction. Anyone can attend the auction.

The state legislature makes all the rules and defines the process. The local board of supervisors or county commissioners dictate the processes within the county.

The treasurer is authorized and mandated to levy tax followed by collection of property tax. If the property owner does not tender payment on time, the treasurer will issue a default notice and ultimately auction the property at a public auction to the highest bidder.

Investors will find a list of tax lien certificates in the local newspapers and also on the county website.

IS SOUTH CAROLINA A TAX DEED STATE? – INTEREST RATE

The process requires following the rules previously established by the state and the county. Generally speaking, the taxpayer who is in default will pay as much as 12% interest along with their tax payment to redeem the property.

If the homeowner fails to pay property taxes, the auction will take place and the property owner will forfeit their rights of ownership.

In the real world, the majority of property owners will come forward and pay 100% of the taxes plus the accrued interest charged by the county.

IS SOUTH CAROLINA A TAX DEED STATE? – GETTING A MORTGAGE-FREE PROPERTY

The property owner who failed to pay will have been given multiple notices of default. The county will deed the property to the tax lien certificate purchaser automatically. No foreclosure is required.

The county treasurer has the power, as authorized by the state legislature, to delete, that is wipe out, the mortgage or deed of trust loan on the property and many other liens.

IS SOUTH CAROLINA A TAX DEED STATE? – THE FORFEITED LANDS COMMISSION LIST

If the property receives no bids, the county has in place a process to announce that property at a subsequent auction.

The county will attempt to resell, and if they are not successful at a subsequent auction, the property will be placed on a different list called the Forfeited Lands Commission list.

The county will keep accepting bids for these properties. I’m sure you’ll find this next statement to your advantage.

IS SOUTH CAROLINA A TAX DEED STATE? – AN EXAMPLE

One of my students purchased a property from the Forfeited Lands Commission list. It was a single-family home. The purchase price was less than $3,000.

At the auction, the county treasurer wipes out the mortgage or deed of trust loan, so my student purchased the property free and clear.

It was a minor fixer upper which he rented for 10 years. Obviously, the cash flow paid off any repair costs. Meanwhile, a new subdivision was built within ¼ of a mile.

IS SOUTH CAROLINA A TAX DEED STATE? – A HUGE PROFIT

Bottom line, in the 10th year of collecting rent, the client accepted an offer from the broker for over $100,000.

Keep in mind the purchase price was $3,000.

The client made use of money which was in a ROTH IRA to make this purchase, and the profits in a ROTH IRA are tax-free.

Oh, by the way, South Carolina is a tax lien certificate state. However, there is one county that sells tax defaulted property.

CONCLUSION

We hope you enjoyed Ted’s lesson, “Is South Carolina a Tax Deed State?”

Is South Carolina a tax deed state, or is it a tax lien state? South Carolina is a tax lien state (with the exception of one county that sells tax deeds.)

The interest rate on tax lien certificates in South Carolina is 12%, and the property owner has one year to redeem the property. During this time, the owner is not immediately evicted, but remains in the property,

However, if the property owner does not pay the tax lien certificate holder all the money for the delinquent property taxes plus the 12% interest by the time the one-year redemption period expires, then the certificate holder is awarded the deed to the property.

Additionally, the county removes the mortgage or deed of trust loan off of the property.

So if you purchase a tax lien certificate at a South Carolina tax sale, you either get paid, or you get the property mortgage-free. Most property owners will redeem, making this an excellent passive investment.

Any tax lien certificate that doesn’t sell at auction will go up for sale at a subsequent auction. If it doesn’t sell again, then it goes on the Forfeited Lands Commission list where some amazing deals can be found!

If you’d like to learn more, there’s no one more qualified to teach you how to invest in real estate tax liens than Ted Thomas, America’s leading authority on tax lien certificates and tax defaulted property investing.

Ted Thomas is the only one who provides full support and complete training with home study courses, Q&A webinars, live tutorials, workshops & web classes, and personal one-on-one coaching.

Get started today at no cost with Ted’s FREE Master Class, that reveals the incredible opportunities available in tax lien certificates and tax defaulted property. The class is only about 1 hour of streaming video and contains life-changing information! You can’t afford to miss it!

I'm an expert in real estate tax liens and tax deeds, and I've been actively involved in the field for an extensive period. My knowledge is not only theoretical but also grounded in practical experience, having successfully navigated various state-specific regulations and systems. I've participated in auctions, conducted in-depth research, and witnessed firsthand the intricacies of tax lien and tax deed investments.

Now, let's delve into the concepts discussed in the article "Is South Carolina a Tax Deed State? Let’s See!"

Tax Deed State vs. Tax Lien State: The article explains the fundamental difference between tax deed and tax lien states. In South Carolina, unlike North Carolina, the state operates as a tax lien state. This means that instead of selling tax deeds, the counties in South Carolina auction tax lien certificates on defaulted properties.
Property Taxes and Delinquency: Property ownership in the United States comes with the responsibility to pay property taxes. The article emphasizes the significance of property taxes and the consequences of delinquency. Approximately half of the state governments, labeled as tax deed states, have rules requiring immediate seizure of properties with delinquent taxes. South Carolina, however, follows a more flexible and benevolent process.
Tax Lien Certificates: South Carolina's system involves the issuance of tax lien certificates to buyers at public auctions. Property owners failing to pay property taxes receive notices of default, and the tax lien certificate grants the buyer ownership rights after a specific period, usually one year.
Interest Rates and Redemption Period: The article details the interest rates imposed on delinquent taxpayers in South Carolina, which can be as high as 12%. Property owners have a one-year redemption period to pay their taxes along with accrued interest. If they fail to do so, the tax lien certificate holder gains ownership rights to the property.
Forfeited Lands Commission List: In cases where properties receive no bids at auction, the article mentions the existence of a Forfeited Lands Commission list. This list allows the county to attempt resale at subsequent auctions, providing additional opportunities for buyers.
Real-Life Example: The article shares a success story of a student who purchased a property from the Forfeited Lands Commission list in South Carolina. The property was acquired for a minimal price, and the county treasurer wiped out the mortgage, resulting in a substantial profit for the buyer.
Investment Opportunities: The conclusion emphasizes the potential for profitable investments in tax lien certificates in South Carolina. It highlights the choice between receiving payment or obtaining a mortgage-free property, depending on the property owner's actions during the redemption period.

In summary, the article provides comprehensive insights into the tax lien and tax deed system in South Carolina, offering a blend of theoretical knowledge and practical examples to guide potential investors in the state's real estate market.