What is a tax lien on a house?
A tax lien on a house is a legal claim tied to the house, or to the owner's property rights, because taxes were not paid. Homeowners usually see two kinds: a county property tax lien on the parcel, and an IRS or state tax lien for unpaid income tax or other tax debt. The lien can stop a clean sale unless it is paid, released, or, for a federal lien on that house, discharged. A lien is different from a levy or tax sale.
Key facts
- The IRS says a federal tax lien is the government's legal claim against your property when you neglect or fail to pay a tax debt.
- The IRS says a federal tax lien on a home must be satisfied before the home can be sold or refinanced.
- Ohio Revised Code 323.11 says the state property tax lien attaches January 1 and continues until paid.
- IRS Publication 783 says Form 14135 is used to apply for a Certificate of Discharge of Federal Tax Lien.
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Get my cash offerThe plain meaning of a tax lien
People use the words tax lien for more than one kind of tax problem. A county property tax lien is tied to unpaid real estate taxes on the parcel. A federal tax lien is the federal government's legal claim against your property when you neglect or fail to pay a tax debt. A state tax lien is a state claim recorded to secure unpaid state taxes.
The difference matters because a parcel tax lien follows the house itself, while an income tax lien starts with the person who owes the tax. It can still reach a house if the person owns the house.
If you want the broader meaning of liens before you focus on taxes, see what is a lien on a house. A tax lien is one type of lien, but it has tax agency rules attached to it.
County property tax liens are tied to the parcel
A county property tax lien comes from unpaid real estate taxes. The state or county source may use words like lien, tax certificate, tax execution, redemption, foreclosure, or tax sale. Those words do not all mean the same thing, but they all point back to unpaid property taxes on the real estate.
State rules are different. The table below covers Indiana and Ohio.
| State | What the source says | What it means for a seller |
|---|---|---|
| Indiana | Indiana's treasurer manual says the state acquires a lien on each parcel for real property taxes on March 1 of the year the property was charged with those taxes. It also says the lien is not affected or destroyed by a sale or transfer. | Unpaid Indiana property taxes can remain a title problem even if the house changes hands. |
| Ohio | Ohio Revised Code 323.11 says the state lien for real property taxes attaches January 1 each year and continues until the taxes, penalties, interest, or other charges are paid. | Unpaid Ohio property taxes must be handled because the lien continues until paid. |
IRS and state tax liens are tied to the taxpayer
An IRS lien is different from a county property tax lien. The IRS says a federal tax lien is the government's legal claim against your property when you neglect or fail to pay a tax debt. The IRS also says that if there is a federal tax lien on your home, you must satisfy the lien before you can sell or refinance your home.
State tax liens vary by state. Indiana's Department of Revenue says a tax warrant filed with the county clerk becomes a judgment lien or levy against property in Indiana and a public record. Ohio's Department of Taxation says a liability can be certified to the Attorney General for collection and the Attorney General may file a tax lien with the county clerk of courts.
How a tax lien affects a sale
A tax lien affects a sale because the buyer and title company need clear title. The IRS is direct about federal liens: if a federal tax lien is on your home, you must satisfy the lien before you can sell or refinance. For a seller, that usually means the tax lien has to be paid, released, partially released, or discharged for that property before the sale can close cleanly.
If the sale price is enough to cover the tax lien and other required payoffs, the lienholder's payoff can be handled as a sale payoff. If the sale price is not enough, the path depends on the lienholder. The IRS says that if the home is being sold for less than the federal lien amount, the taxpayer can request a discharge to allow the sale to be completed.
An IRS discharge is specific to the property being sold. IRS Publication 783 says a Certificate of Discharge under Internal Revenue Code Section 6325(b) removes the United States' lien from the property named in the certificate. The same publication says to complete Form 14135, Application for Certificate of Discharge of Federal Tax Lien, and submit the application at least 45 days before the transaction date that the certificate is needed.
State and county releases are handled under that lienholder's rules.
A lien is not the same as a levy or a tax sale
A lien is the claim. A levy is a collection action against property. The IRS says a lien is not a levy.
A tax sale or foreclosure is a later enforcement step, not the same thing as the lien itself. Ohio law says that after certain delinquency steps, the county treasurer shall enforce the tax lien by civil action for sale of the premises in the same way mortgage liens are enforced.
What to sort out before you sell
Start by identifying who filed the tax lien. A county property tax lien is handled differently from an IRS lien or state Department of Revenue lien.
For an IRS lien, check whether the sale proceeds can satisfy the lien. If not, the IRS discharge process in Publication 783 and Form 14135 may be part of the closing plan.
A house with a tax lien can still have sale options, but the lien has to be dealt with. For more on selling when title has a lien problem, read how to sell a house with a lien. If you are comparing costs and payoffs before a sale, see how much does it cost to sell a house.
Frequently asked questions
Can I sell a house with a tax lien?
You may be able to sell, but the tax lien has to be handled for clear title. The IRS says a federal tax lien on a home must be satisfied before the home can be sold or refinanced. If the home is selling for less than the federal lien amount, the IRS says the taxpayer can request a discharge to allow the sale to be completed.
Is a property tax lien the same as an IRS tax lien?
No. A property tax lien is tied to unpaid real estate taxes on the parcel. An IRS tax lien is the federal government's legal claim against your property when you neglect or fail to pay a tax debt.
What is an IRS Certificate of Discharge?
IRS Publication 783 says a Certificate of Discharge under Internal Revenue Code Section 6325(b) removes the United States' lien from the property named in the certificate. The publication says to complete Form 14135 to apply. It also says to submit the application at least 45 days before the transaction date that the certificate is needed.
Does a tax lien mean the house has already been sold?
No. A lien is a claim, not a completed sale.
How do I remove a property tax lien?
The common answer is payment, but the exact office and process depend on the state and county. Ohio Revised Code 323.11 says the Ohio property tax lien continues until the taxes and related charges are paid.
What if the sale proceeds are not enough to pay the tax lien?
For a federal tax lien, the IRS says the taxpayer can request a discharge if the home is being sold for less than the lien amount. Other lienholders may have their own release rules.
Sources
Checked against each source on November 3, 2026. This page is general information, not legal or tax advice.
- Understanding a federal tax lien (Internal Revenue Service)
- What if there is a federal tax lien on my home? (Internal Revenue Service)
- Publication 783, How to Apply for a Certificate of Discharge From Federal Tax Lien (Internal Revenue Service)
- Taxpayer Bill of Rights (Indiana Department of Revenue)
- County Treasurers Manual, Chapter 7 (Indiana State Board of Accounts / IN.gov)
- Ohio Rev. Code 323.11 (Ohio Laws / State of Ohio)
- Ohio Rev. Code 323.25 (Ohio Laws / State of Ohio)
- OVTA Compliance Process (Ohio Department of Taxation)
Related seller questions
- How do you sell a house with a lien?
- What is a lien on a house?
- Can you sell a house with a mortgage?
- How much does it cost to sell a house?