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8160-8162 Public Auction: Post-Notification of Sale Circumstances

8160. OBJECTION TO SALE BY TAXING AGENCY
If, before the date of sale, a taxing agency files with the tax collector an objection, the lien of its taxes or assessments or any rights it may have to the property are not affected by the sale.  The property may be sold subject to the taxing agency's liens (Rev. & Tax. Code §3695).

Please note the following:

1) Cities and taxing agencies that assess and collect their own taxes may not object to a sale unless the objection is accompanied by an executed, proposed Chapter 8 agreement to purchase the property at a price not less than the minimum bid. An option to purchase is not acceptable (Rev. & Tax. Code §3695).

2) A taxing agency may not file a blanket objection to proposed sales but must take action in relation to each sale (Attorney General Opinions 1-23-40, 4-9-40). 

3) An eligible nonprofit organization (see M-8345 for definition) may also file a written objection to individual items in the sale (Rev. & Tax. Code §3695.5). The tax collector may require certified copies of the organization's resolution objecting to the sale. The organization must provide a certified copy of its articles of incorporation as a condition of the agreement, along with its application to purchase the property in accordance with Chapter 8 provisions and at a price equal to that approved by the board of supervisors (Rev. & Tax. Code §3695).

NOTE:  See M-8131 and M-8132 regarding the withdrawal of property from sale upon objection by taxing agencies or nonprofit organizations.

8161. CONSENT TO SALE BY TAXING AGENCY
If the taxing agency does not, before the date of sale, file an objection to the sale, its liens are cancelled by the sale and it is entitled to its proper share of the proceeds deposited in the delinquent tax sale trust fund (Rev. & Tax. Code §3695).

8162. IRS REDEMPTION RIGHTS
When a property on which the Internal Revenue Service holds a tax lien is sold at public auction, the United States has the right of redemption for 120 days from the date of such sale or for the period allowable for redemption under local law, whichever is longer (Internal Revenue Code 26 USC section 7425(d); Rev. & Tax. Code §3712(g)). 

The amount to be paid by the IRS to the successful bidder is the actual amount paid for the property by the bidder, plus interest at six percent per annum from the date of sale, plus the expenses of the sale that exceed any income received from the property (Treasury Regulation 26 CFR Ch. 1 §301.7425-4 (b)(1)) (July 8, 2008).

NOTE:  Addresses of Internal Revenue Service offices are located in IRS Publication 4235 and in the Appendix of this publication.

The Revenue and Taxation Code sets forth no procedures or rules for conducting a public auction.  The tax collector may establish whatever rules or procedures he/she deems appropriate in order to achieve the sale of the properties.  Recommended procedures are found beginning with M-8181.