If I buy a property at an auction in California, I heard that EVEN IF there is a tax lien on the property, I do NOT have to worry about it because:
1 - I do NOT have to pay for it.
2 - If a property has an IRS lien, the US government has the option of redeeming the property within 120 days after the sale. In other words, if the US government decides to buy the property, they will have to reimburse the bid amount to me. If they don’t take any actions within 120 days after the sale, I will have the property free of the IRS lien.
Visit your county assessor’s webpage or contact them directly. I found with my county in California most of the questions you have asked can be answered their with a minimum amount of time invested in surfing around their website. Here, the auctions are not held until October, so you still have plenty of time to investigate the process.
I think you miss understand, if you buy a property at a property tax sale and it has a Federal IRS Lien on the property, you have to pay the IRS the Lien amount within 120 days to clear the property title or the IRS has the right to come in and sieze the property from you without reimbursement! (Redemption but no reimbursement for carrying cost's, potential profit or overhead)
You see the original owner had the lien placed against Federal taxes they owed, even though they might have stopped paying a mortgage and did not pay there property taxes the IRS is still owed the money, normally an IRS Lien might be $5k, $10k or more but very unlikely to be more than the property value, if you buy it for a property tax lien, you have to pay the IRS there lien off or you don’t own the property!
Just because you pay $500, $1000 or $10,000 for property taxes does not relive the debt to the IRS, and you have to pay them or you don’t have a property! The IRS will sieze property but there sure not going to come in and pay for it, if you want it, you pay for it!
tax lien sales is conducted in California with interest rate of 18%. California provide redemption period is the time provided to the landowner, or, in some cases, any “interested party” to redeem the property by paying the tax lien, which will include the owed taxes, penalties, costs, and interests.