What is the maximum rate of interest at tax sale?

• A. 18%
• B. 12%
• C. 6%
• D. 24%

Answer: (A)

The amount charged as interest on delinquent taxes at a tax sale is limited by statute, and the commonly cited cap is 18% per year. This rate is typically simple interest on the delinquent amount (taxes, penalties, and costs) and it accrues until the taxes are redeemed or the certificate is paid out. The 18% figure is the maximum the law allows for the return to the tax certificate purchaser. Rates like 6% or 12% are below the cap, while 24% would exceed what the statute permits, so 18% is the correct maximum.