[quote=Effective Demand]It depends, as I understand it it depends on when the tax lien was recorded.

If the tax lien was junior to the foreclosing lien it gets wiped out except they have a right of redemption period of 120 days.

If it was senior to the lien on property #1, since propert #1 sold first then flipper #1 would have to pay it.[/quote]

My understanding about tax lien is that they have different priority than regular loan/lien, and they never get wiped out in TS.
Maybe I am wrong about this, but that is the impression that I have.