Some governments choose to sell the collection rights to unpaid property taxes in tax lien public auctions and therefore will not have property tax balances reported within the financial statements.

Question

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When a government sells the collection rights to unpaid property taxes in tax lien public auctions, it means that they are transferring the right to collect future property tax payments to a third-party investor. As a result, the government will not have these outstanding property tax balances reported within their financial statements.

Some Governments Choose to Sell the Collection Rights to Unpaid