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BANKRUPTCY



The Treasurer's Office understands how much hardship and stress filing for bankruptcy can create. We are willing to work with all taxpayers in bankruptcy who make a good faith effort to remain current with taxes that have incurred since filing for bankruptcy. Understanding your property tax liability is vital to succeeding in your bankruptcy case.

If you are involved in an active bankruptcy case, the Franklin County Treasurer wants you to know the following:

 

  1. You are responsible for all taxes not included in your bankruptcy case. In most cases, this means that you are responsible for all taxes, penalty, interest and assessments you have incurred since the date you filed for bankruptcy. For example, if you filed for bankruptcy in January 2022, you will be responsible for all tax billing periods that come due beginning January 2023. The only exception is if you filed a Chapter 7 no asset bankruptcy case and intend to surrender your property as part of your bankruptcy case. In Chapter 7 cases like this, the Treasurer does not file a proof of claim for delinquent taxes because the debtor has no compelling reason to pay the taxes, as he or she will surrender the property whether or not taxes are delinquent. The next owner of the property eventually pays the delinquent taxes through the purchase of the property.

  2. Unlike many other debts, taxes covered in a bankruptcy case do continue to accrue late penalties and interest. If the Treasurer's Office has filed a proof of claim for delinquent taxes in your bankruptcy case, you are responsible for paying off any late penalties or interest that accrue on the taxes included in your case. Call the Treasurer's Bankruptcy Coordinator at 614-525-3431 after the collection period each year to inquire about whether you owe any interest on the taxes covered in your case.

  3. If you owe delinquent property taxes that will be paid through a bankruptcy case, you cannot enter into a delinquent tax payment plan with the Treasurer's Office until the tax covered in your bankruptcy case has been paid in full or until your bankruptcy case is closed —whichever comes first.

  4. It is illegal for anyone to pursue legal action (including tax liens and foreclosures) against any property included in an active bankruptcy case. The bankruptcy stay prevents this. If you are in an active bankruptcy case and receive a notice regarding impending tax lien sale, please immediately notify the Franklin County Treasurer's Office Bankruptcy Coordinator or call Delinquent Tax at 614-525-3431 and ask to speak with the Tax Lien Department.There is an exception to the stay if the Bankruptcy Court has granted relief from stay to a creditor for a particular property.

  5. Always inform your attorney of any changes to the status of your taxes so he or she can assist you to his or her maximum capacity.

  6. If you have surrendered your property as part of a Chapter 7 bankruptcy case, you will continue to receive all tax bills and statements in your name until a new owner assumes legal ownership of the property. Ohio law requires the Treasurer to mail twice-annual tax bills to the owner of record for all parcels in Franklin County, and your name continues as the owner of record until someone else assumes legal ownership of the property. Please contact the mortgage holder or third party to announce that you have surrendered the property and for questions related to the transfer of the deed.

  7. If the Treasurer has filed a proof of claim for delinquent taxes in your bankruptcy case and you have remained current with all taxes you have incurred since filing for bankruptcy, you can call the Bankruptcy Coordinator at 614-525-3431 and ask to set up a bankruptcy pre-payment plan to pay your upcoming current taxes by monthly escrow payments. Doing so will enable you to make a monthly payment for your current taxes, rather than having to pay the large lump sum twice a year.