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  1. #1

    Default Delinquent Property Tax and Ownership Confusion

    My question involves real estate located in the State of: Hawaii

    I have been made the beneficiary and trustee of an acre of land on the Big Island of Hawaii. This acre was left to me by my grandfather. We have lived here on this property for over 35 years. The acre of property we live on is not owned exclusively by my grandfather but by 3 other family members as well, each owning a quarter share. This parcel of land was originally bought and owned by my grandfather's father. He left a quarter share each to his daughter, her two children, and my grandfather. My grandfather and his sister have since passed leaving his share in a trust to me, and his sister's share with her children. I have moved my family back onto the property to take care of my grandmother who suffers from Alzheimer's Disease. She is in the late stages of this illness. Since she is not competent, I am responsible for her and all the decision making. This home has not had any repairs made to it since the '70s and it is falling apart!! Ever since moving onto this property 35+ years ago, the other family members have shown no interest in this property, and according to my grandfather, they have not paid land taxes at all. All payments have been made by my grandfather and he has made sure that all payments made at the land tax office reflected that HE was the one making payments. (payments filed under his name and number) Upon his passing, I am noticing that our land tax payments are in arrears. We have a balance due of about $15,000. This includes the last installment for 2016 and all of 2017 and 2018. (including penalties and interest) Our law here in Hawaii says that if you fall behind more than 2 years on your land tax payments then they can foreclose on your property.

    I recently got a tax sale jeopardy letter in the mail asking for $8,900.00 by the 30th of June to be taken off the list. I need some advice as to what I can do? I do not have very good credit and I'm not sure if banks will work with me being that there are other parties/owners listed on the deed. Should I start with getting the property out of trust and into my name? Can I hold the other parties on the deed accountable for past land tax payments? Should I see a lawyer? I haven't spoken with the other family members in years. The last time words were exchanged they were not nice. How can I get some equity out of this property being that it is paid off in full and worth approx. $700,000. Any help or advice would be greatly appreciated.

  2. #2
    Join Date
    Jan 2006

    Default Re: Delinquent Property Tax and Ownership Confusion

    Does the trust hold the entire interest in the property or does the trust share ownership of the property with others you have mentioned?

    if the trust owns the entire property, the trust is liable for all of the taxes. If the trust shares ownership with others, then the tax liability is apportioned to each owner as their share of interest allows for.

    You stated your grandmother still lives on the property. Who or what is allowing her to live on the property? If the property is owned by the trust and possibly others, not including your grandmother, then who has granted her permission to live there?

    regarding removing the property from the trust;
    what you can do will be dependent on what the trust allows for. If the trust doesn’t allow for the property to be removed from the trust, you wouldn’t have a right to do so. Regarding putting it in your name; if you are the only beneficiary of the trust, then if the property can be removed from the trust, it is likely you would be able to put whatever share the trust holds in your name.

    If the entire interest is held by the trust and there are other beneficiaries, then no, unless the trust allowed for the entire interest to be placed in your name, you could not do that. If there are other beneficiaries, then the property would have to be divided as the trust directs.

    if the entire interest is held by the trust, then there are no others “on the deed”. If there are others that are actually grantees on a deed, then while there may be liability for the taxes (it’s not clear they would be liable given your set of facts), then a court could hold them liable for their fair share of the taxes. You would have to sue to obtain a judgment for what you pay on their behalf to recover what they should have paid.

  3. #3
    Join Date
    Mar 2013

    Default Re: Delinquent Property Tax and Ownership Confusion

    Quote Quoting whiterabbit75
    View Post
    Should I see a lawyer?
    Hell, yes.

    With a $700,000 property at risk, you'd be a fool not to.

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