Tax Law Insights

South Carolina state tax liens were previously recorded each county’s register of deeds, register of mesne conveyance, or clerk of court (i.e. in the same place where real property records are recorded).  In March 2019 the South Carolina General Assembly passed a law authorizing the South Carolina Department of Revenue (SCDOR or DOR) to implement a statewide system of filing and indexing liens.

SCDOR has now created a statewide lien recording system, which is accessible online.  As of November 1, 2019, SCDOR will no longer file tax liens, satisfactions, or expungements with county recording offices.  Active and satisfied liens will be listed on the registry for 10 years. Any lien that is expunged is removed from the registry.

The online lien recording system allows anyone to access information related to a tax lien for free.  Searches can be conducted using a lien identification number, an individual’s name, or a business’s name.  The online system provides the following information:

• Lien ID
• Taxpayer Name
• Lien Status
• Taxpayer Address
• County where issued
• Tax Type
• Liened Period(s)
• Tax
• Penalty
• Interest
• Costs/Fees
• Balance/Payoff
• Date Filed

A tax lien filed in the online system has the same effect as a tax lien previously filed in a county recording office and is subject to the same governing laws.  Unlike a tax lien filed in a county recording officer, however, tax liens filed in the statewide lien recording system are effective statewide.

While the statewide lien recording system should make it easier to locate and address tax liens, there are some uncertain areas.  For example, the online system provides payoffs but the payoffs are not required to be provided by the authorizing legislation and the legislation does give taxpayer’s a right to rely on payoff information provided by the system.  Persons purchasing property and discharging a lien should still obtain a commitment from SCDOR to discharge the lien upon the payment of a specific amount to avoid any risk in the payoff being inaccurate.  The online system, like other online databases, is also subject to issues associated with the name queried.  The name formatting in the database is based on information provided to DOR and may not exactly match a taxpayer’s actual legal name.  Consequently, searches may need to be done using multiple names or spellings in order to be comfortable all applicable liens are located.