I have never heard of any part of state or federal government writing off the taxes. However, the taxes should be a lien on the property and would be paid at the real estate closing from proceeds. Title companies search public records to see if there are any taxes or association fees owed before the company will issue a title policy. Your closing agent should be able to assist you with this problem.
Eric Jerome GoldTrusts AttorneyCalabasas, CACA licensed ·
Ms. McMahon is on point. If the tax you mention are on the home, then a lien tax lien likely already exists. If the tax debt is not already recorded as a lien on the property, it would be considered a debt of the estate as a creditor's claim. If the estate is sufficiently liquid, you could pay the taxes before selling the home. If th estate does not have the funds, then the debt (along with other creditor's claims, if any) would be paid with available proceeds, if any.
To be sure that everything is handled correctly, you should consult with a local probate attorney for specific guidance and direction.
Both of the above answers are excellent, but I would note that you don't mention if these are real estate taxes or income taxes. If you are dealing with income taxes and the estate is not sufficiently liquid, then you may be able to enter into an offer in compromise with the Commonwealth. I have had clients who have done this successfully in the past, but there need to be a genuine concern as to liquidity or actual liability, and you should have an accountant review her previous filings to confirm your grandmother actually owes the amounts reported by the Commonwealth. In some instances, an "SFR" (substitute for a return) is filed by the IRS, and as the Commonwealth shares information with the IRS it is possible for both governmental entities to have incorrect information when the taxpayer fails to file. You should consult a qualified tax attorney (NOT one who advertises on late-night TV) to discuss the numerous tax and probate matters that may arise.