Why does it matter whether the purchaser of property tax debt holds tax debt in a Chapter 13 case or secured debt? The resulting interest rate is why, and the Seventh Circuit’s opinion in In re Romero, Case No. 25-2021 (7th Cir. July 16, 2026), sets out the opposing views. The majority of the Circuit panel held that under applicable Illinois law a purchaser at the county’s tax sale held a tax claim and that under section 511 of the Bankruptcy Code the purchaser was entitled to 18% interest. The dissenting Judge would hold that the purchaser had an over-secured claim entitled to interest under Till v. SCS Credit Corp., 541 U.S. 465 (2004), which would result in a much lower market interest rate.
