Tax-forfeited property

What is tax-forfeited property?

Tax-forfeited property is parcels of real estate on which delinquent property taxes were not paid. Title to the land and buildings was forfeited, and the title is now vested in the State of Minnesota. Following a review period per Minnesota statutes, these properties are classified and open to the public for purchase.

In May 2024, the Minnesota legislature substantially changed the state’s property tax forfeiture laws. In making these changes, the legislature wanted to do the following:

1. Create an opportunity for “interested parties” to claim “surplus” funds when counties were in the process of selling tax-forfeited land.
2. Capture the market value of the tax-forfeited property for the purpose of calculating what is a “surplus”.
3. Help ensure adequate due process for all “interested parties” participating in the tax forfeiture process. “Interested party/parties” is any party with an interest in the real estate including but not limited to an owner of the property, a lienholder, or any other party who has filed their name according to Minnesota Statute section 276.041. 

There are several steps to the tax-forfeiture process. Please review the general overview below.

When the taxes are not paid and become delinquent, the county obtains a judgment against the property in court. This is known as “bidding in” (claiming) the property for the State of Minnesota -- the property is ultimately going to belong to the State of Minnesota if the delinquent taxes are not paid. This triggers a 3-year redemption period where the property can be redeemed by paying the delinquent taxes, penalty, interest, special assessments, and fees owed, thereby removing any claim the state has to the property. Paying property taxes as a third party or interested party will not change ownership. If the redemption period expires and the property tax forfeits, the state becomes the owner of the property. The former owner loses their rights to the property, and any right to repurchase the property will expire at the time the property goes up for sale.   

At this point, if the property has valuable minerals, the DNR can claim the mineral interest in the property and start a proceeding in court to pay the former owner for the value of those minerals. If the DNR does not find the property has valuable minerals, the county will notify “interested parties” of the state acquired mineral rights in the property for $50. 

The county is obligated to find a new owner for the forfeited property and return the property to the tax rolls. The county will offer the property for sale for 30 days at the current estimated market value (EMV), calculated for tax purposes, within 6 months of the property forfeiting or the owner vacating the property, whichever is later. If the property does not sell within 30 days, it will be offered for sale for at least two weeks at “minimum bid." “Minimum bid” is the sum of delinquent taxes, special assessments, penalties, interest, and all costs associated with managing the tax-forfeited property. If the winning bid exceeds the “minimum bid," the county must notify the “interested parties” that a “surplus” exists. The county will deposit the “surplus” with the Court and the Court will determine who is to receive the “surplus." The county portion of the funds received from the sale will be placed in the forfeiture fund and used to reimburse the county for the expenses they incurred while managing the property. The forfeiture fund will help manage other tax-forfeited property the county is responsible for and offset the expenses for parcels that sell below the cost to maintain them. If no one bids on the property at the EMV or “minimum bid” sale, the county will offer it for sale under the “credit bid” sale at a reduced amount to facilitate a sale. The “credit bid” process is handled under Minn. Stat. 282.01. The property sale price will be set by the county board and the sale process will revert to the former rules under Minn. Stat. 282.01. Any claim to “surplus” funds expires if the property has not sold at the “minimum bid” sales.

Full details of the tax forfeiture process are available in the Minnesota Statutes.

Chapter 276.041 of the Minnesota Statutes – filing to receive notice of delinquent taxes.

Chapter 279 of the Minnesota Statutes – delinquent real estate taxes.

Chapter 280 of the Minnesota Statutes – real estate judgment sale.

Chapter 281 of the Minnesota Statutes – redemption period for delinquent real estate taxes.

Chapter 282 of the Minnesota Statutes – real estate tax forfeited land sales.

Land auctions

The properties listed below will be available to preview on PublicSurplus.com as of September 20, 2024. Bidding begins September 27.

Radon in Real Estate Transactions

Over-the-counter land sales

There are no over-the-counter land sales at this time.