The government cannot keep your home equity beyond the tax debt
U.S. Const. amend. VTakings Clause
In plain words
If your home is taken or sold to pay property taxes, the government may collect what you owe, but it may not keep the extra value. Keeping the surplus is a "taking" of your property without just compensation, which the Fifth Amendment forbids (Tyler v. Hennepin County, 2023). You may be able to claim the surplus, but you usually must follow your state's claim process and deadlines.
Who is protected
Property owners whose home was taken or sold by the government to satisfy a tax debt.
When it applies
- Only once a sale date is set or after the foreclosure sale.
- Only if you are behind on property taxes.
- Your state's process and deadlines for claiming surplus control how you get it; missing them can cost you the money.
What you can do
Find out if there is surplus and how to claim it
Ask the county treasurer or tax-sale office, in writing, for the sale price, the amount of the tax debt and costs, and the process and deadline for claiming any surplus.
Open the toolLearn your state's tax-sale rules
Read the tax-help guide for your situation and note every deadline.
Open the tool
Honest limits
- The government may keep what you owe in taxes, interest, penalties and costs; only the excess is protected.
- Just compensation is generally measured by the sale price when the auction is fairly run, not by what you think the home was worth (Pung v. Isabella County, 2026).
- States can require you to file a claim by a deadline. Watch for surplus-recovery companies charging high fees for help you may be able to get free.
- This is general legal information, not legal advice, and it does not promise any result. A HUD-approved housing counselor or a lawyer can look at your facts.
The law
- U.S. ConstitutionFifth Amendment — Takings Clause
U.S. Const. amend. VTakings Clause
Exact part: Takings Clause
What it says: Private property may not be taken for public use without just compensation.
Read the official texthttps://www.law.cornell.edu/constitution/fifth_amendment - U.S. ConstitutionFourteenth Amendment — due process
U.S. Const. amend. XIV, § 1Due Process Clause
Exact part: Due Process Clause
What it says: No state may take a person's life, liberty, or property without due process of law.
Read the official texthttps://www.law.cornell.edu/constitution/amendmentxiv - Court decisionTyler — keeping surplus equity is a taking
Tyler v. Hennepin County, 598 U.S. 631 (2023)
What it says: A county that sold a home for a tax debt and kept the surplus took more property than was due, violating the Takings Clause.
Read the official texthttps://www.law.cornell.edu/supremecourt/text/22-166
Court cases
- Homeowner wonCited for this rightTyler v. Hennepin County
Tyler v. Hennepin County, 598 U.S. 631 (2023)
a government that sells a home for unpaid taxes and keeps the value beyond the tax debt takes property without just compensation
- Homeowner lostCited for this rightPung v. Isabella County
Pung v. Isabella County, No. 25-95, slip op. (U.S. June 23, 2026)
after a fairly conducted tax sale, the government owes the former owner the surplus from the sale price, not the property's fair market value
- Homeowner wonCited for this rightHall v. Meisner
Hall v. Meisner, 51 F.4th 185 (6th Cir. 2022)
a homeowner's equity in property taken for a smaller tax debt is protected property, and taking it without compensation states a federal takings claim
- Homeowner wonSame topicJones v. Flowers
Jones v. Flowers, 547 U.S. 220 (2006)
when mailed notice of a tax sale is returned undelivered, the government must take additional reasonable steps to notify the owner before selling the property
- Homeowner wonSame topicMennonite Board of Missions v. Adams
Mennonite Bd. of Missions v. Adams, 462 U.S. 791 (1983)
a person with a recorded interest in property is entitled to notice by mail or equally reliable means before a tax sale, and publication or posting alone is not enough
- Homeowner lostSame topicMartins v. BAC Home Loans Servicing, L.P.
Martins v. BAC Home Loans Servicing, L.P., 722 F.3d 249 (5th Cir. 2013)
a mortgage servicer acting for a properly assigned mortgagee may foreclose in Texas without possessing the original note, and an oral promise to modify a large loan is not enforceable
- Homeowner lostSame topicMilton v. U.S. Bank National Ass'n
Milton v. U.S. Bank Nat'l Ass'n, 508 F. App'x 326 (5th Cir. 2013) (per curiam) (unpublished)
an agreement to delay a Texas foreclosure falls within the statute of frauds and must be in writing to be enforced
- Homeowner lostSame topicBFP v. Resolution Trust Corp.
BFP v. Resol. Tr. Corp., 511 U.S. 531 (1994)
the price received at a non-collusive foreclosure sale that complied with state law is reasonably equivalent value under the Bankruptcy Code
Related rights
The right to real notice before the government takes or sells your home
U.S. Const. amend. XIV, § 1Due Process Clause
Before a state or county sells your property — for example at a tax sale, or through a court foreclosure — the Constitution requires notice that is reasonably likely to actually reach you. If the government knows your address, publishing a notice in the newspaper is not enough. If a mailed notice comes back unclaimed, the government must take extra reasonable steps to reach you, if it practicably can.
Read this rightThe right to be heard in court, and to speak for yourself
U.S. Const. amend. XIV, § 1Due Process Clause
Due process means that before the government, through a court, takes your property, you must get a meaningful chance to be heard. In federal court, you have a legal right to present your own case without a lawyer. Most state courts also let people represent themselves, under state rules.
Read this rightConstitutional right to a procedure for claiming excess proceeds
La. Const. art. VII, § 25(A)(1)(d)
After the 2024 amendment, Louisiana’s Constitution requires the legislature to provide a procedure for claiming the excess proceeds when property is sold to enforce a tax lien. If your property is sold for more than the taxes and charges, ask the tax collector how to claim the rest.
Read this rightDue course of law under the Texas Constitution
Tex. Const. art. I, § 19
The Texas Constitution says no citizen may be deprived of property except by the “due course of the law of the land.” It is the state’s version of due process: government action that takes property must follow fair procedures, including notice and a chance to be heard.
Read this rightRight to claim excess proceeds after a tax sale
Cal. Rev. & Tax. Code § 4675(a)(1)
If the county sells your property for more than the taxes and costs, the extra money (excess proceeds) can be claimed. Any party of interest, including the former owner, can file a claim with the county within one year after the tax deed is recorded. California had this process before the 2023 Tyler v. Hennepin County decision.
Read this rightRight to the remaining overbid after a treasurer’s public auction
Colo. Rev. Stat. § 39-11.5-109
Since 2024 (after Tyler v. Hennepin County), Colorado requires a public auction before a tax-lien holder can take your property, and the extra money (overbid) is paid out. After junior lienholders are paid, any remaining overbid must be paid to the property owner. The treasurer must mail you a notice about it within 30 days after the auction.
Read this right