State Summary

Tax Collection Method: Liens
Primary Bidding Type: Bid-down Percentage of Ownership
Redemption Period: 2 years
Redemption Interest Rate/Flat Penalty: 24% simple interest per annum

The following information summarizes the life cycle, requirements, and administering of tax liens in the state of Iowa. Please read this information carefully. There are tax collection laws that pertain to all counties in Iowa, but be aware that there are subtle differences between the counties as well. When the word "typical" is used in the FAQs below, it indicates that most counties use this procedure/follow this convention, but not all counties.

Is Iowa a tax lien or a tax deed state?
Iowa is a tax lien state.

What is the name of the county official whom typically collects property taxes in Iowa?
Treasurer.

When are property taxes due in the state of Iowa?
Property tax payments in Iowa are due in two equal installments. The first installment is due September 1 in the year of assessment, and the second installment is due March 1 the following year.

When do property taxes become delinquent in the state of Iowa?
Property tax payments become delinquent exactly one month after the due dates. The first payment installment becomes delinquent October 1 and the second payment installment becomes delinquent April 1. Interest accrues on delinquent tax at a rate of 18% per annum, or 1.5% per month.

What is the name of the county official whom typically conducts tax lien sales in Iowa?
Treasurer.

When does the typical Iowa county hold their annual tax lien sale?
All Iowa counties hold their annual tax lien sale on the third Monday in June. Tax lien certificates that remain unsold from this primary sale are offered again through "Adjourn Sales". Generally depending on the size of the county and the amount of tax lien certificates left to be sold, counties may conduct Adjourn Sales the third Monday of each subsequent month as required.

What are the registration requirements for the typical Iowa tax lien sale?
Most Iowa counties require registration at least four days before the sale with a registration fee of $25.

What is the bidding type used at a typical Iowa tax lien sale?
The Bid Down Percentage of Ownership method is used at a public auction. This bidding method comes into play when a property has more than one bidder. Competing bidders then bid down the percent ownership they are willing to share with the current property owner. Issues regarding percent ownership will only come into play if the current property owner doesn't redeem and the foreclosure for tax deed process is initiated. If there is no competition (only one bidder) for an offered tax lien certificate, the bidder may purchase the tax lien certificate for the minimum bid amount.

What forms of payment are generally accepted at a typical Iowa tax lien sale?
Most counties accept cash, personal or business check, or any guaranteed funds.

What are the general terms of payment for the typical tax lien certificate purchased at an Iowa tax lien sale?
Most Iowa counties require full payment the day of the sale.

What is the maximum return (interest rate and/or flat penalty rate) investors earn while they hold the tax lien certificate?
The state-mandated interest rate is 24% per annum, or 2% accrual per month (or fraction of a month). So, if a tax lien certificate is redeemed just prior to the end of the two-year redemption period, the investor's return would be 48%.

What is the redemption period for tax lien certificates in Iowa?
The redemption period is two years and starts on the day that the certificate is purchased by the investor. The tax lien certificate holder may file a Notice of expiration of right of redemption, which initiates the tax foreclosure process.

Are tax liens certificates offered "over-the-counter" in Iowa?
No.

What is the name of the county official whom typically determines the values of properties on a annual basis?
Assessor.

For more information on the life cycle, requirements, and administering of tax liens in the state of Iowa, refer to the following chapters in the Code of Iowa:

Chapter 446: Tax Sales
Chapter 447: Tax Redemption
Chapter 448: Tax Deeds

Iowa County Reference