Washington DC Tax Liens: Sale, Redemption, and Foreclosure

If you fall behind on property taxes in Washington, D.C., a lien attaches to your real estate automatically, the debt gets sold at the District’s annual July auction, and you have six months from that sale to pay everything owed before the buyer can sue to take your home. Washington, D.C. tax liens carry an 18% annualized interest rate, prime the mortgage on your property, and end in a permanent loss of title if you do nothing. The good news: you can stop the process at almost any stage by paying the full balance.

How the Lien Attaches

The moment your property tax installment is due and unpaid, a lien forms against the land and everything built on it. No court order, no recording, no separate notice.¹ It happens by operation of law.

The lien isn’t limited to your base tax bill. Business improvement district (BID) taxes and vault rents are pulled in automatically, and other District agencies can certify charges (including certain water and sewer fees) that then ride along with the tax lien.²

A D.C. tax lien outranks almost every other claim on your property, including your mortgage. That’s why many mortgage servicers will quietly pay your delinquent taxes from escrow and add the amount back to your loan balance: their collateral position depends on it.

What Delinquency Costs Each Month

The financial damage starts immediately. D.C. law adds a flat 10% penalty to any unpaid installment, plus simple interest of 1.5% per month until you pay.³ That’s 18% a year. On a $5,000 delinquency, you’re looking at roughly $500 in penalty and another $900 in interest by the time twelve months have passed.

These charges keep compounding right up to the auction, so the balance at sale is almost always bigger than what you originally missed.

Notices Before the Sale

You should receive two written notices before your tax debt goes to auction. The first, a notice of delinquency, is mailed by first-class mail by May 1 of the sale year to the owner listed on the tax roll. If your mailing address differs from the property address, a duplicate copy addressed to “Property Owner” is sent to the property itself.⁴

The second, a final notice, is mailed at least two weeks before the auction date.⁴ Paying the full amount stated in either notice before the sale date keeps the property off the auction block entirely.

One warning: if the District fails to mail a notice, or the notice doesn’t reach you, that failure does not invalidate the tax sale. The law puts the burden on you to keep your mailing address current with the Office of Tax and Revenue and to keep your taxes paid.

What Actually Happens at the Tax Sale

The District holds its real property tax sale once a year, typically in July. Each delinquent account is auctioned to the highest bidder, and no property can sell for less than the taxes owed.⁵

What gets sold is not your house. The District sells a certificate of sale, which gives the buyer the right to collect the debt with interest, or to eventually sue for ownership if you don’t redeem.⁶ Your name stays on the deed, you keep possession, and you keep the right to redeem. But the clock starts.

The certificate earns the purchaser simple interest of 1.5% per month on what they paid, calculated from the first day of the month after the sale.⁶ That 18% annualized return is what draws investors. It’s also what makes delay expensive.

If an investor bids more than what you owed in taxes, the surplus is held by the District and paid to you as the property owner, unless you redeem within six months, in which case the surplus goes back to the certificate holder.⁷ The District does not keep the excess either way.

How to Redeem Your Property

Redemption means paying off everything owed so the certificate of sale is canceled and your title is cleared. You pay the District, not the purchaser directly. The total covers:⁸

The purchase price the investor paid at auction, plus 1.5% monthly interest from the first of the month after the sale.
Any later tax bills the investor paid on your behalf, plus the interest those bills would have accrued.
All current taxes, BID taxes, and vault rents, brought fully current.
The purchaser’s reimbursable expenses under the statute, such as title search fees.

If the purchaser has already filed a foreclosure lawsuit, you also pay their legal expenses. Attorney fees are capped at $1,500 if the case is resolved before the fifth status hearing, with $75 for each additional hearing after that and another $300 for a motion for final judgment.⁹ Courts can approve higher fees in unusually complex cases, but that’s rare.

How to Pay

You can pay online at MyTax.DC.gov by ACH or credit card, or mail a check or money order payable to the “DC Treasurer.” Write your Square, Suffix, and Lot (SSL) number on the payment so it posts to the right account.¹⁰ BID taxes and vault rents can’t be paid by personal check or online; they require certified check, cashier’s check, or money order.

Before paying, ask the Office of Tax and Revenue for the current tax bill and tell them you’re redeeming from a tax sale. That way the balance they quote you includes the interest calculated for redemption purposes rather than a routine payoff.

Certificate of Redemption

Once you’ve paid in full, request a certificate of redemption. The District has 60 days to issue it.⁸ Recording the certificate with the Recorder of Deeds releases the encumbrance created by the tax sale, and the recording fees are waived. The purchaser gets their money back with interest, and the matter is closed.

The Six-Month Deadline and Foreclosure Lawsuit

If six months pass after the tax sale and you still haven’t redeemed, the certificate purchaser can file a complaint in D.C. Superior Court to foreclose your right of redemption.¹¹ You’ll be served with a summons. From that point on, the purchaser’s service-of-process costs and attorney fees are part of what you’d have to pay to redeem.

The court can bar your right of redemption and give the purchaser fee simple title, set the sale aside and determine what you owe to redeem, or combine those outcomes depending on the facts.¹¹ You can still redeem while the lawsuit is pending by paying the full amount, including legal fees. Many owners do, and the fee caps exist partly to keep that option realistic.

If the court enters a final foreclosure judgment, the Mayor is directed to deliver a deed in fee simple to the purchaser.¹² Your ownership and your mortgage are both extinguished. That outcome is permanent.

What Bankruptcy Does and Doesn’t Do

Filing for bankruptcy triggers an automatic stay that halts most collection actions, including a pending tax foreclosure lawsuit.¹³ A purchaser who continues pursuing foreclosure after you file is violating the stay.

The stay has real limits. It does not prevent the District from creating or perfecting a lien for property taxes that come due after your filing date, so new bills keep accruing and new liens keep attaching.¹³ Bankruptcy buys time; it doesn’t erase the tax debt. For homeowners trying to save the property, a Chapter 13 repayment plan can spread the arrears over three to five years, which is often the most practical path.

The Cheapest Time to Act Is Now

The best moment to resolve a D.C. tax delinquency is before it ever reaches auction. Once the sale happens, you’re paying the investor’s 18% annualized interest on top of the penalties and interest already running on the underlying taxes.³ If a foreclosure complaint follows, you add court costs and attorney fees to the pile.⁹

Paying the amount stated in your delinquency notice before the sale date keeps the property off the auction entirely.⁴ If you can’t cover the full balance at once, contact the Office of Tax and Revenue about payment arrangements. Even a partial resolution can pull you back from the harshest consequences. The one path that guarantees the worst outcome is doing nothing.

1
D.C. Law Library. District of Columbia Code 47-1331 – Tax Is Lien on Real Property; Priority; Application of Payment
2
D.C. Law Library. District of Columbia Code 47-1340 – Notice to Agencies; Certification of Taxes Due
3
D.C. Law Library. District of Columbia Code 47-811 – Levy and Disposition of Tax; Payment; Penalty for Nonpayment
4
D.C. Law Library. District of Columbia Code 47-1341 – Notice of Delinquency
5
D.C. Law Library. District of Columbia Code 47-1346 – Sale at Public Auction
6
D.C. Law Library. District of Columbia Code 47-1348 – Certificate of Sale, in General
7
D.C. Law Library. District of Columbia Code 47-1307 – Real Property Tax Assignment; Sale and Transfers
8
D.C. Law Library. District of Columbia Code 47-1361 – Required Payments; Notice to Purchaser; Certificate of Redemption
9
D.C. Law Library. District of Columbia Code 47-1377 – Purchaser Reimbursed by Redeeming Party for Expenses
10
Office of the Chief Financial Officer. Real Property Owner’s Guide to the Tax Sale Redemption Process
11
D.C. Law Library. District of Columbia Code 47-1370 – Complaints by Purchasers to Foreclose the Right of Redemption
12
D.C. Law Library. District of Columbia Code 47-1382 – Purchaser’s Deed; Payment; Compliance With Terms of Judgment
13
Office of the Law Revision Counsel. 11 USC 362 – Automatic Stay