Tax lien -> foreclosure -> quick sale of the property ... Income Tax Liability?

[George P.]

Situation... tax lien purchased with the intention to passively earn the interest (btw interest is taxed as regular income). Fast forward 1 1/2 years, the tax lien is not redeemed and the underlying property is acquired by the tax lien holder who puts it on the selling block and sells within 1 year of owning the property.

Assuming there the net is positive (difference between the selling price and the investment (original tax lien investment and additional investments such as closing fees/costs, attorney fees, accrued taxes and fines etc) --how is it going to be taxed - as short-term capital gain (my income tax rate)?

Thanks

[Matt Devincenzo]

@Steven Hamilton II