- A tax sale surplus occurs when a tax sale for a particular property results in the final selling price being higher than the amount needed to settle taxes on the property. The excess money is classified as the tax sale surplus.
- A tax sale surplus creates the need for additional paperwork if the property was sold at a tax sale with delinquent taxes still owed, causing the surplus funds to be deposited in a state tax sale surplus fund. This paperwork includes a disclosure form that must be filed with the county auditor before the property title is transferred.
- Tax sale surplus money is, in most instances, deposited into a state tax surplus fund prior to the filing of a disclosure notices. However, if a property is sold for greater than the minimum tax bid and then not redeemed, the original owner of record of the property when the tax deed is issued has a potential claim on the funds.
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