What happens when the taxes owed are greater than what the property is worth?

[PG]

What happens when the taxes owed on a property are greater than what the property is worth?

If a tax sale for vacant land has a minimum bid of $560,000 but only has an assessed value of $70,000, does the municipality have the right to sell it for a lesser amount than the taxes owed?

I imagine that a municipality could not sell for anything less than the taxes owed, but that the current owner could try to negotiate with the municipality for a lower tax payment.

The other question I have is that how could outstanding taxes on vacant land ever reach $560,000?

[Dave2]

What happens when the taxes owed on a property are greater than what the property is worth?

If a tax sale for vacant land has a minimum bid of $560,000 but only has an assessed value of $70,000, does the municipality have the right to sell it for a lesser amount than the taxes owed?

The other question I have is that how could outstanding taxes on vacant land ever reach $560,000?

1. Usually the land will not sell, it will be vested to the municipality,(ONLY IF THEY WANT IT,) and it maybe offered for surplus sale
     down the road.

     Municipalities can set the rules for surplus sales so sometimes  
     to put it bluntly a shit bid will work if there is no minimum
     price.

2. Assessed values can be way over the map compared to true values.  I have seen ones over by a factor of 10 and under by a factor of 10.  (i.e. 1/10th the true value.)  they are an indicator but are only one of many mainly because a previous owner has not challenged the valuation. (For some reason if they are under I do not normally challenge them.)  

3. Without knowing the specifics on your last point I suspect an environmental cleanup which usually has high costs.

[PG]

Thank you very much, Dave2, for your helpful response.

The property I had in mind was the vacant land on king street in sioux lookout. Apparently there used to be an elementary school on the lot so an environmental clean up could possibly be the reason for such a high bid price.

Thanks again Dave2 for your comments.

Peter