Article · October 2026

Tax lien premium bid

Tax lien premium bid: money above taxes and fees. Colorado vs Maryland on interest and refunds, and the evidence to save before you bid. Not legal advice.

The Accrella team

In this guide

A tax lien premium bid is money you pay above the taxes, interest, and fees due to win the certificate. In Maryland, a high-bid premium is a separate amount the collector can require when the bid clears a statutory threshold. Whether that excess earns interest, and whether it comes back on redemption, is a statute or county-page question. There is no single national rule. This article checks Colorado’s excess-to-county rule and Maryland’s high-bid-premium statute, and contrasts them briefly with bid-down auctions in Florida and Arizona. It does not list which states use a premium bid. For every other jurisdiction, check your county or state rules on the education guides. Sources were reviewed October 2, 2026. This is not legal advice.

What a tax lien premium bid is

A premium bid is competition by paying more than the face amount due, instead of bidding down the interest rate. Colorado’s sale statute defines that face amount as the taxes, delinquent interest, and fees then due. Maryland’s high-bid premium is calculated from the bid and a value threshold. It is not the same payment. For statutory ceilings versus what you actually earn, see the interest-rates article.

OCC Bulletin 2004-39 (August 31, 2004) says the laws governing the redemption and transfer of tax lien certificates vary among states and municipalities. That is why every rule below names its state or county.

Three auction labels (not a state count)

These labels describe how bidders compete under the statutes cited below. They are not a tally of states.

Premium (bid up the price)

Bidders pay more than the amount due. Whether the excess earns interest, and whether it is refunded, is a question for the statute or the county page you opened. This article answers it for Colorado’s statute, Boulder County, Mesa County, and Maryland’s high-bid premium. For anywhere else, check your county or state rules.

Bid down the interest rate

The face amount stays fixed. The certificate or lien goes to the bidder who accepts the lowest interest rate. In Florida, § 197.432(6) (2026) awards each certificate to the person who will pay the taxes, interest, costs, and charges and will demand the lowest rate of interest, not in excess of the maximum rate of interest allowed by that chapter. In Arizona, § 42-18114 sells the lien to the person who pays the whole amount of delinquent taxes, interest, penalties, and charges due and who offers the lowest rate of interest, which may not exceed the rate prescribed by § 42-18053. In a bid-down sale you compete by giving up rate, not by paying cash above the lien. The ceilings are on the interest-rates article.

High-bid premium (Maryland)

Maryland only. A high-bid premium under Md. Tax-Property § 14-817(b)(2) is not Colorado’s excess-to-county premium. The collector may impose a high-bid premium calculated from the statutory formula. The statute says the collector refunds that premium without interest on redemption, or on delivery of a tax-sale deed to the plaintiff in an action to foreclose the right of redemption. The Maryland section below has the formula and the exceptions.

Colorado: excess to the county, no interest on the premium

Colorado only. Statute text is from the public.law pages for C.R.S. §§ 39-11-115 and 39-12-103, which say the compilation is current through Fall 2025. The statute sends the premium to the county. The plain statements that the premium earns no interest and is not returned come from the Boulder County and Mesa County treasurer pages, quoted below.

Section 39-11-115(1) says the tax liens offered at public auction shall be sold to the persons who pay the taxes, delinquent interest, and fees then due, or who further pay the largest amount in excess of those taxes, delinquent interest, and fees. The excess amount shall be credited to the county general fund. The same subsection says the taxes, delinquent interest, and fees shall draw interest at the rates fixed by law. The excess is not on that list.

Section 39-11-115(2) lets the treasurer set bidding rules so the auction can be run in an efficient and equitable manner. Those powers include recognition of buyers in numerical sequence, in rotation, or in the order in which bids are made, and they include setting minimum bid increases. Subsection (4) requires the treasurer to announce the rules at the beginning of the auction. If the auction is on the internet or another electronic medium, the treasurer shall post the internet bidding rules on that medium for at least two weeks before the sale. So the format, bid increments, and minimums can differ by county. Save the rules for the sale you enter.

Section 39-12-103 is the redemption-interest section. Subsection (3) computes redemption interest on the amount of taxes, delinquent interest, and costs for which the tax lien was sold, from the date of sale, together with subsequent taxes accruing after the sale that the purchaser paid and endorsed on the certificate of purchase. Subsection (5) says all statutory fees the purchaser paid in connection with the certificate bear the same rate of interest as the original amount for which the tax lien was sold. The premium is not part of that base. Subsection (6) counts portions of months as whole months.

Boulder County only. The Boulder County Treasurer FAQ says premium bids are the amounts over and above the taxes, interest, and fees on the day-of-sale list. Asked whether interest is calculated on the premium bid, the page says no: you do not earn any interest on a premium bid. Asked whether you get the premium bid back, the page says no. It says premium-bid money goes directly to the County General Fund and is not retained by the Treasurer’s Office. Boulder states that for the last five years its premium bids averaged from 5 percent to 7.6 percent, although individual properties may go for more or less. That is a Boulder figure, not a Colorado one. Boulder also says its auction is open bidding, that it does not rotate through bidders in a predetermined order, and that the bid amount is the premium amount.

Mesa County only. The Mesa County Treasurer bidding page says premiums on winning bids are a cost of securing the tax lien and are not returned, and that they do not draw interest. Two counties are not the whole state. Check the treasurer page for the county you are bidding in.

Maryland: high-bid premium under § 14-817

Maryland only. The text below is from Md. Tax-Property § 14-817 on the General Assembly website. Our Maryland guide notes that redemption interest and high-bid-premium rules vary by county, so a single Maryland percentage is misleading. Whether a premium applies depends on the collector and the sale notice.

Subsection (a)(2) says all sales shall be at public auction to the person who makes the highest good faith accepted bid, in fee or leasehold. The high-bid premium in subsection (b)(2) is a further amount. It is not the bid itself, and it is not an excess credited to a county general fund under Colorado § 39-11-115.

Subsection (b)(1) says that, except as subsection (c) provides, property may not be sold for a sum less than the total amount of all taxes on the property that are certified to the collector under § 14-810, together with interest and penalties on the taxes and the expenses incurred in making the sale. The lien for the taxes, interest, penalties, and expenses passes to the purchaser. Subsection (c) has a separate rule for certain abandoned property.

Subsection (b)(2)(i) says the collector may establish a high-bid premium to be applied to all properties to be sold at the tax sale. A different sentence applies to grouped and sealed-bid sales. Subsection (a)(5)(v) says that, except in Montgomery County, the collector shall establish a high-bid premium under subsection (b)(2) for all properties to be sold in groups or by a sealed-bid process. So the premium is optional for an ordinary sale but required for grouped or sealed-bid sales outside Montgomery County.

The general formula is in subsection (b)(2)(ii). Except as subparagraphs (iii) and (iv) provide, the high-bid premium shall be 20 percent of the amount by which the highest bid exceeds 40 percent of the property’s full cash value. In Baltimore City and Prince George’s County, subsection (b)(2)(iii) says that, except as subparagraph (iv) provides, the high-bid premium shall be 20 percent of the amount by which the highest bid exceeds the greater of the lien amount or 40 percent of the property’s full cash value. For property assessed under agricultural use assessment, subsection (b)(2)(iv) says the high-bid premium shall be 20 percent of the amount by which the highest bid exceeds the appropriate value determined by the collector. Hypothetical arithmetic under the general formula: if full cash value is $200,000, the threshold is $80,000. A highest bid of $90,000 exceeds it by $10,000, so the premium is 20 percent of that, or $2,000. A highest bid of $70,000 does not exceed the threshold, so the formula produces no premium. In Baltimore City and Prince George’s County, use the lien amount instead of $80,000 if it is larger.

Subsection (b)(2)(v) says that, in addition to the amounts payable under subsection (b)(1), the highest bidder shall pay a high-bid premium if the collector determines that a high-bid premium shall be used for the tax sale and indicates in the public notice of the sale that the high-bid premium will be applied. Read the sale notice. It tells you whether the premium applies.

Subsection (b)(2)(vi) says the collector shall refund the high-bid premium, without interest, to the holder of the tax sale certificate on redemption of the property for which the premium was paid, or to the plaintiff in an action to foreclose the right of redemption on delivery of a tax sale deed for that property. Subsection (b)(2)(vii) says the high-bid premium is not refundable after the time required under § 14-833 if there has been no redemption and an action to foreclose the right of redemption has not been filed within that time. This article did not open § 14-833, so it does not state that deadline. Check it before you bid if you might hold the certificate without filing to foreclose.

Why a premium can erase the yield

Boulder County only. Boulder’s FAQ gives a break-even example for Boulder County: if you place a premium bid of 6 percent and the redemption interest rate is 10 percent, you will lose money if the lien is redeemed before eight months pass. Boulder also says you can lose money if the interest you earn does not equal or exceed the premium you paid, and it calls the sale a buyer-beware process. The arithmetic behind it: interest accrues on the lien amount, so a 6 percent premium needs 0.6 of a year at 10 percent to earn back, about 7.2 months. Seven months of interest is about 5.8 percent of the lien amount and eight months is about 6.7 percent, which matches Boulder’s eight-month line. To run your own figures, divide the premium, as a percent of the lien amount, by the annual redemption rate. The result is the years of interest you need before the premium is covered. Those 6 and 10 percent figures are Boulder’s example, not a rate for your sale.

Where the premium is not returned and earns no interest, as Boulder and Mesa say, a fast redemption can leave you behind even when the redemption rate looks attractive, and a larger premium pushes the break-even point later. Maryland’s high-bid premium works differently. It comes back without interest on redemption or on delivery of the tax-sale deed, so what it costs you is the use of that cash while the certificate is outstanding, unless the § 14-817(b)(2)(vii) deadline passes with no redemption and no foreclosure filed. Parcel, owner, and bankruptcy questions are on the due diligence checklist.

What evidence to save before you bid

Each check below has four parts: the question you still need answered, the record and office that answer it, the evidence to save, and an outcome of pass, fail, or unresolved. A missing value is an unresolved check, not a clean result. Keep the date you saved a file separate from the date the office published it.

What auction format does this county use (premium, bid-down, high-bid premium, other)?

Question: What auction format does this county use: premium, bid-down, high-bid premium, or something else?
Record and office: the sale statute, then the county sale notice or treasurer page. Florida § 197.432(6) (2026) is a lowest-rate award. Arizona § 42-18114 is a lowest-rate award. Colorado § 39-11-115 is a largest-excess award, and the treasurer announces the bidding rules. Maryland § 14-817(a)(2) is a highest-good-faith-bid auction, and § 14-817(b)(2) is the high-bid premium. For any other state, check your county or state rules.
Evidence to save: the URL, the retrieval date, and the sentence that names the format. Keep the retrieval date separate from any effective date or compilation line on the page.
Outcome: Pass when the file has the official page and the format sentence for that sale. Fail when the file uses another state’s format. Unresolved when the statute or the sale notice will not open.

Does a premium or high-bid premium earn interest under the opened statute or county page?

Question: Does a premium or high-bid premium earn interest under the page you opened?
Record and office: the redemption or sale statute, and the county page when that is the page you can open. Section 39-12-103 computes Colorado redemption interest on the taxes, delinquent interest, and costs for which the lien was sold, and on subsequent taxes the purchaser paid. It does not say the excess earns interest. Boulder County’s FAQ says you do not earn interest on a premium bid. Mesa County’s bidding page says premiums do not draw interest. Maryland § 14-817(b)(2)(vi) refunds the high-bid premium without interest. This article does not answer the question for any other county.
Evidence to save: the statute or county URL, the retrieval date, and the sentence on interest.
Outcome: Pass when the saved page answers interest for that county. Fail when the file treats the premium as interest-bearing and the opened page says it is not. Unresolved when the page does not say.

Is the premium refunded on redemption (or only after foreclosure / never)?

Question: Is the premium refunded on redemption, only on delivery of a deed after foreclosure, or not returned?
Record and office: the same statute or county page. Boulder County says you do not get the premium bid back. Mesa County says premiums are not returned. Maryland § 14-817(b)(2)(vi) refunds the high-bid premium without interest to the certificate holder on redemption, or to the foreclosure plaintiff on delivery of the tax-sale deed. Subsection (b)(2)(vii) says it is not refundable after the time required under § 14-833 if there has been no redemption and no foreclosure action was filed within that time.
Evidence to save: the URL, the retrieval date, and the refund sentence. If the premium is paid only when the public notice says so, save that notice too.
Outcome: Pass when the saved page answers the refund for that sale. Fail when the file assumes a refund the opened page does not state. Unresolved when the page does not say, or when a cross-referenced section such as § 14-833 was not opened.

What winning bid / premium amount and notice text did you save for this sale?

Question: What winning bid, premium amount, and notice text did you save for this sale?
Record and office: the county auction result and the public notice. In Maryland, § 14-817(b)(2)(v) requires the collector to determine that a high-bid premium will be used and to say so in the public notice before the highest bidder pays it. In Colorado, save the premium and the bidding rules the treasurer announced or posted under § 39-11-115(4).
Evidence to save: the result URL, the notice URL, the retrieval date, and the winning premium or high-bid premium as printed.
Outcome: Pass when the file has the winning figure and, where the statute requires it, the notice text. Fail when the file uses a county average, including Boulder’s 5 percent to 7.6 percent statement, as if it were this parcel’s bid. Unresolved when the winning bid or the required notice is missing.

The checks above ask how this sale prices the excess and what you saved from the notice. They do not identify the parcel, the assessor record, or a bankruptcy case. Those questions are on the tax lien due diligence checklist. What you hold after the purchase, what a redeemable deed is, and which claims a tax deed leaves in place are separate articles.

Where Accrella fits

Knowing the auction format is not the same as knowing the winning premium on a parcel. Those figures belong in the evidence record next to the parcel. An organized evidence record is not a legal opinion.

In Accrella Discovery you can filter candidates by state and county and by auction format (Bid down, Premium, Rotation, OTC only) when that filter is present. Use the Watchlist for diligence review before a bid-sheet export. Accrella gates that export on diligence and strategy approval. An exported file does not submit a bid or replace the auction platform registration and payment process. Coverage, a current list, and readiness to buy are separate questions. A geographic directory is not a current auction list.

Questions investors ask

What is a tax lien premium bid?

It is money above the taxes, interest, and fees due, paid to win the certificate, or, in Maryland, a high-bid premium the collector can require when the bid clears the statutory threshold in § 14-817(b)(2). Colorado § 39-11-115 credits the excess to the county general fund. Whether the excess earns interest or comes back is a statute or county-page question. For any other state, check your county or state rules.

Does a tax lien premium earn interest?

It depends on where you bid. Colorado § 39-12-103 computes redemption interest on the taxes, delinquent interest, and costs for which the lien was sold, and on subsequent taxes the purchaser paid. It does not say the excess earns interest. Boulder County’s FAQ says you do not earn any interest on a premium bid. Mesa County’s bidding page says premiums do not draw interest. Maryland § 14-817(b)(2)(vi) refunds the high-bid premium without interest. If the county page does not say, treat it as unresolved.

Do I get the premium back if the owner redeems?

It depends on the page for that sale. Boulder County’s FAQ says you do not get the premium bid back. Mesa County’s bidding page says premiums are not returned. Maryland § 14-817(b)(2)(vi) says the collector shall refund the high-bid premium, without interest, to the certificate holder on redemption. It also goes to the foreclosure plaintiff on delivery of the tax-sale deed, but not after the § 14-833 deadline if there has been no redemption and no foreclosure action was filed in time. For any other county, check your county or state rules.

What is a high bid premium in Maryland?

Maryland only. Under § 14-817(b)(2), it is an extra amount the highest bidder owes when the collector decides to use it and says so in the sale notice. Generally it is 20 percent of the amount by which the highest bid exceeds 40 percent of full cash value. Baltimore City and Prince George’s County measure from the greater of the lien amount or 40 percent of full cash value, and agricultural-use property from a value the collector determines. The collector refunds it without interest on redemption or on delivery of the tax-sale deed, but not after the § 14-833 deadline if there is no redemption and no timely foreclosure filing. It is not Colorado’s excess-to-county premium.

How is a premium bid different from bidding down the interest rate?

In a premium bid you pay more than the face amount due. In a bid-down sale the face stays fixed and the lowest rate wins. Florida § 197.432(6) (2026) and Arizona § 42-18114 are bid-down examples only. Colorado § 39-11-115 sells to the person who pays the largest excess, and that excess is credited to the county general fund. Maryland’s high-bid premium is a separate statutory amount on top of a highest-bid sale. The rate ceilings are on the interest-rates article.

Can a premium bid make you lose money?

Boulder County’s FAQ says yes, if the interest you earn does not equal or exceed the premium you paid. Its example, for Boulder County, is a 6 percent premium and a 10 percent redemption rate: you lose money if the lien is redeemed before eight months pass. To check your own sale, divide the premium by the annual redemption rate to get the years of interest needed to earn it back. Save the winning premium and the refund rule before you treat a rate as your return.

Sources and review method

Recommendations reflect the workflows described in these sources. Vendor features, plans and county availability can change; confirm the current scope with each provider.

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