Real Estate and Personal Property Taxes
In the Commonwealth of Massachusetts, all real estate and personal property taxes are assessed on a fiscal year basis. The fiscal year runs from July 1st through the following June 30th . Taxes may be collected either semi-annually or quarterly. In 1991, Holden town meeting voted to adopt the quarterly method of collection for real estate and personal property tax bills. The chronology for the collection of these bills each year is as follows:
On June 30 of each year, Preliminary tax bills are mailed to taxpayers. The Preliminary bills are based upon the prior year’s tax obligation, taking into consideration any betterments that increased the bill and any exemptions or abatements which would have reduced it. The base amount of the Preliminary bill is 50% of this prior year total. The Board of Assessors may, at its discretion, adjust this amount to reflect any known imminent tax increase, such as a new debt exclusion or prop 2 ½ override. This final amount is then divided in half, with the first half being due on August 1 and the second half due on November 1. If any of the due dates fall on a weekend, the bills would be due on the following Monday.
By state law, Preliminary tax bills cannot show either a valuation for the property or a tax rate. Likewise, elderly and veterans exemptions will not show up on these bills.
The bill form is one 8x11 sheet divided into three parts. The bottom section should be remitted with your August 1payment, and the middle section should be remitted with your November 1 payment. The top section is for you to keep for your records. If you pay in person and wish to have your payment receipted, make sure to bring the entire bill with you each time you make a payment. The top part of the bill will be stamped with the date and time that payment is made for each of the due dates, and then will be returned to you for your records.
Any amount that is not paid by the appropriate due date is then subject to 14% interest per annum from the due date to the date of payment. Interest accrues daily.
On December 31, Actual tax bills are mailed. The Actual tax bill is based upon the tax rate for that particular year multiplied by the parcel (or personal property) valuation. The amount that had been previously billed as Preliminary tax is then subtracted from that total and the resultant balance is divided in half. The first half of the Actual tax bill is due on February 1 and the second half on May 1.
Actual tax bills must show the value of the parcel or personal property, as well as the tax rate. They are also required to show the last date that an abatement may be applied for, which, by statute, is February 1.
Any unpaid balance on the Preliminary bill will also be reflected on the Actual bill, and the interest line will show the amount of interest that will accrue on this overdue balance to the next due date, February 1.
Payments not made by the appropriate due dates are again subject to interest at 14% per annum.
Like the Preliminary bill, the format of the Actual bill is an 8x11 sheet which is divided into three parts. The bottom section should be remitted with your February 1 payment and the middle section with your May 1 payment. The top section should be retained for your records. If you pay in person and require a receipt, please bring the entire bill with you. The top part of the bill will be stamped with the date and time that each payment is made, and then returned to you for your records.
Any balance on the bill which remains unpaid after May 1 is subject to a statutory Demand charge, which is a flat $15.00 per bill, regardless of the amount that remains unpaid and overdue. Demand bills are usually sent before the end of May each year. There is a 14 day due period after Demands are sent before any further action may be taken.
Real estate taxes which remain unpaid after the issuance of a Demand bill are subject to the following tax taking process, which, if carried to its conclusion, results in a municipal tax lien being placed on the property.
Reminder letters are sent out to all taxpayers whose bills have a balance remaining after Demand. Taxpayers are alerted to the tax title process, for which the next step, by state law, requires advertisement in a local newspaper. A subsequent letter may be sent to the owners of all parcels that remain unpaid in late August advising as to the intent of tax taking. Notice is given of a due date to avoid advertisement. A date will be noted from which only cash, certified check, or cashier’s check are acceptable forms of payment. Partial payments may still be made on the account, but only payment in full will prevent advertisement.
The tax title advertisement, including the prospective date of taking, is printed in a local newspaper. The Town of Holden customarily uses The Landmark for tax title ads. The ad triggers additional charges on the account, all of which are prescribed by statute. The prorated cost of the advertisement is also added to each account. This office sends a letter and a copy of each ad to the respective owners and reiterates the intent of tax taking and emphasizes the final due date. At this point, partial payments can no longer be accepted.
If payment is not made in full by the advertised tax taking date, a document called an Instrument of Taking is prepared by this office and signed by the Collector, after which it is recorded at the Registry of Deeds. The recording of the Instrument of Taking creates a tax lien on the property.
After the recorded Instruments have been received back from the Registry, this office sends a letter with a photocopy of the recorded Instrument to the owner of each affected property, advising them that a tax lien has been placed on their property. We always recommend prompt redemption of the tax lien, which has a negative impact on any efforts to sell or refinance the property.
After a tax taking, the responsibility for collection of the delinquent taxes and charges on the property no longer rests with the Tax Collector, but shifts to the Treasurer.
Land Court Foreclosure
After a parcel has been in tax title for 180 days, the Town may choose to initiate foreclosure on the property through the Land Court in Boston. The Town of Holden does have a vigorous and successful foreclosure program, and eventually every parcel in tax title will be scheduled for foreclosure.
If a taxpayer cannot immediately clear his delinquent taxes, but wishes to avoid foreclosure, he may choose to enter into a payment plan with the Treasurer to pay off the tax lien over a specified number of months. All payment plans have the following features in common:
- There must be a signed agreement between the taxpayer and the Treasurer.
- A certain specified amount must be paid each month.
- Payment of the current tax bill is incorporated into all tax title payment plans.
- All plans state that default on the plan will immediately trigger foreclosure by the Town. New Owners
State law requires that property taxes be listed in the name of the legal owner of record, which is the individual or entity that owned the property as of the January 1 prior to the beginning of the tax year. This office recognizes, however, that properties are bought and sold every day, and we make great effort during the entire tax collection process to send copies of all bills and correspondence to new owners, although we are required by statute to send the original bill to the owner of record. It would be incumbent upon all new owners, however, to make sure that they are in possession of a current tax bill. Failure to receive a bill does not in any way diminish the responsibility for payment of that bill.
Supplemental Real Estate Tax Bills
If you have purchased a home that is newly-built, please be aware that it may be subject to an additional real estate tax, known as the Supplemental Real Estate Tax. Town of Holden is required by Massachusetts law to assess Supplemental Taxes on property on which the value has changed by more than 50% during any fiscal year. While this could apply to any property, it is usually triggered during the year that a new home is built.
If your property falls into this category, you will receive a Supplemental Tax bill, along with an explanatory letter from the Holden Board of Assessors to explain how the amount of the supplemental tax was calculated.
*** PLEASE BE AWARE THAT SUPPLEMENTAL TAX BILLS ARE SENT ONLY TO THE PROPERTY OWNER.***
IF YOUR REAL ESTATE TAXES ARE NORMALLY PAID ON YOUR BEHALF BY YOUR MORTGAGEE, USING FUNDS THAT YOU HAVE PAID INTO AN ESCROW ACCOUNT, IT IS YOUR RESPONSIBILITY TO MAKE YOUR MORTGAGEE AWARE THAT THESE ADDITIONAL SUPPLEMENTAL TAXES ARE DUE.
If not paid timely, Supplemental Real Estate Taxes are subject to all collection remedies allowed under Massachusetts state law, including the placement of a tax lien on the property .
For more information on Supplemental Real Estate Taxes, please see the Assessors' page on this web site.