When property taxes go unpaid, governments can eventually sell the home to recover what's owed. The injustice that made national news was what happened to the surplus — the money left over after the debt was paid.
Geraldine Tyler's case
As documented by the Pacific Legal Foundation, which represented her, Geraldine Tyler, a Minneapolis homeowner in her 90s, fell behind on property taxes after moving to a safer neighborhood. Her tax debt was about $2,300, which grew to roughly $15,000 with penalties and interest. The county seized her condo and sold it for $40,000 — then kept all of it, leaving her with about $25,000 in lost equity.
In May 2023, the U.S. Supreme Court ruled unanimously in Tyler v. Hennepin County that keeping the surplus is an unconstitutional “taking.” In January 2025, New Jersey's Supreme Court reinforced those protections in its own state.
How common was it?
According to the Pacific Legal Foundation, from 2014 to 2021, this kind of “home equity theft” took nearly 9,000 homes and more than $860 million in homeowners' equity nationwide, and it was legal in about a dozen states. The debts averaged a small fraction of each home's value.
What you can do
- Don't wait. The cheapest fix is paying or setting up a plan with your county tax collector before a sale is scheduled.
- Ask about redemption. In many cases you can “redeem” the property by paying what's owed before the deed is issued.
- If a sale already happened, ask about surplus funds. You may be owed money — and there are scammers who chase those funds, so work with the clerk of court or a trusted attorney.
- Consider selling before the sale if the taxes can't be cured, so you keep your equity instead of risking it at auction.
We walk Northeast Florida homeowners through exactly these choices every week. If you're behind on property taxes, here's a plain-English guide — or reach out and we'll help you figure out the next step.
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