The Delinquent Tax and Tax Forfeiture Manual

1 Delinquent Tax and Tax Forfeiture Manual Updated April 2020 Return to Table of Contents Page 2 of 242 Delinquent Tax and Tax Forfeiture Manual Table of Contents Chapter 1: Introduction .. 7 Overview .. 7 Stages of Property Tax Delinquency and 7 Chapter 2: Determination .. 9 Introduction: Stage One .. 9 Delinquent Date: First Business Day in January .. 9 Property Tax Lists: First Business Day in January .. 10 Delinquent Tax List: February 15 .. 13 Auditor s Affidavit: February 15 .. 18 Notice of Delinquent Taxes: February 20 .. 18 Delinquent Tax Letter: March 20 .. 21 Interest on Delinquent Taxes .. 22 Federal Active Service Property Tax Grace Period .. 24 Record of Interested Parties .. 26 Bankruptcy.

2 28 Determination Calendar .. 30 Sample Case: Stage One .. 31 Chapter 3: Publication ..34 Introduction: Stage Two .. 34 Bids for Publication: January .. 35 Designation of Newspaper: January .. 36 County Tasks before First Publication .. 37 Deadline for First Publication: March 20 .. 37 Requirements for Second Publication .. 37 Conditions for Republication .. 38 Affidavit of Publication .. 38 Payment of Publication Costs .. 38 Deadline for Mailing: March 20 .. 39 Return to Table of Contents Page 3 of 242 Delinquent Tax and Tax Forfeiture Manual Affidavit of Mailing .. 39 Announcement Confirms Court s Authority .. 39 Costs of Publication, Mailing, and Judgment .. 40 Publication of Notice and List Chart .. 42 Sample Case: Stage Two.

3 44 Chapter 4: Judgment ..47 Introduction: Stage Three .. 47 Objection to Delinquent Taxes .. 47 Tax Judgment by Court Administrator .. 48 Tax Judgment by Court .. 49 Interest Rate for Judgments by Court .. 50 Copy of Tax Judgment to County Auditor .. 51 Conditions for Canceling Tax Judgment .. 51 Recording Payments Before/After Tax Judgment .. 51 Distribution of Delinquent Tax Amount .. 52 Tax Judgment Sale: Second Monday in May .. 54 Judgment on Delinquent Taxes Chart .. 56 Sample Case: Stage Three .. 57 Chapter 5: Redemption ..59 Introduction: Stage Four (Part I) Redemption .. 59 Redemption under Tax Judgment Plan .. 60 Methods of Payment for Redemption .. 64 Conditions for Partial Redemption .. 65 Administration of Partial Redemption.

4 65 Administration of Full Redemption .. 67 Redemption upon Owner s Death .. 69 Delinquent Tax Paid in Inverse Order .. 71 Voluntary Conveyance in Lieu of Forfeiture .. 73 Attachment of Rents .. 74 Attachment of Crops .. 76 Redemption of Property Chart .. 78 Return to Table of Contents Page 4 of 242 Delinquent Tax and Tax Forfeiture Manual Sample Case: Stage Four (Part I) Redemption .. 79 Chapter 6: Confession of Judgment ..81 Introduction: Stage Four (Part II) Confession of 81 Ten Year Plan: Eligibility .. 82 Ten Year Plan: Confession Agreement .. 84 Ten Year Plan: Recording of Confession .. 86 Ten Year Plan: Administering Installments .. 87 Ten Year Plan: Default on Payments .. 88 Five Year Plan: Eligibility .. 90 Five and Ten Year Plan Comparison.

5 91 Properties Not Eligible for Confession .. 92 Interest Rates .. 93 Calculation of Installments and Interest .. 93 Format for Confession of Judgment .. 101 Notice of 101 Administrative Fees .. 102 Eligibility for Property Tax Refund .. 102 Confession of Judgment Flow 104 Sample Case: Stage Four (Part II) Confession of 105 Chapter 7: Expiration of Redemption ..109 Introduction: Stage Five .. 109 Notice of Expiration: General Information .. 111 Notice of Expiration: 112 Notice of Expiration: Publishing .. 113 Notice of Expiration: Mailing .. 114 Notice of Expiration: 118 Notice of Expiration: 60-Day Grace Period .. 120 Notice of Expiration: County Costs .. 121 Certificate of Forfeiture : General Information .. 123 Certificate of Forfeiture : Format.

6 124 Application for Cancelation of Forfeiture .. 124 Return to Table of Contents Page 5 of 242 Delinquent Tax and Tax Forfeiture Manual Certificate of Cancelation: General Information .. 127 Tax Action Following Cancelation .. 128 Persons in Active Military Service .. 129 Expiration of Redemption Flow Chart .. 131 Stage Five: Expiration of Redemption .. 132 Chapter 8: Tax Forfeiture ..135 Introduction: Stage Six .. 135 Delegation of County Board Powers to Auditor .. 136 Removal from Tax Rolls .. 136 Liens and Encumbrances .. 137 Classification of Tax-Forfeited Land .. 141 DNR Approval of Classification and Sale .. 144 Appraisal of Tax-Forfeited Land .. 150 Exchanging Tax-Forfeited Land .. 151 Improvements to Tax-Forfeited Land.

7 153 Timber Sales .. 155 Leasing Tax-Forfeited Land .. 156 Easements on Tax-Forfeited Land .. 159 Government Acquisition: Request .. 161 Government Acquisition: Purchasing .. 163 Government Acquisition: Authorized Public Use .. 165 Government Acquisition: Other Methods of No Cost Conveyance .. 169 Government Acquisition: Costs .. 170 Land Restricted or Withheld from Sale .. 171 Hazardous Waste on Tax-Forfeited Land .. 177 Notice of Public Sales .. 180 Conduct of Public Sales .. 187 Public Sale by Contract for Deed .. 194 Cancelation of Contract for Deed .. 197 Private Sale to the Other Owners or to Adjacent Owners .. 203 State Deed for Tax-Forfeited Land .. 205 Return to Table of Contents Page 6 of 242 Delinquent Tax and Tax Forfeiture Manual Taxes to be Paid Before Recording.

8 208 Forfeited Tax Sale 211 Distribution of Net Revenue .. 214 Three Percent Surcharge .. 217 Repurchase of Tax-Forfeited Land .. 219 Back on the Tax Rolls .. 231 Persons in Active Military Service .. 232 Public or Private Sale of Tax-Forfeited Land Flow Chart .. 234 Sample Case: Stage Six .. 235 Glossary ..239 Return to Table of Contents Page 7 of 242 Delinquent Tax and Tax Forfeiture Manual Chapter 1: Introduction Overview The Red Book is a Manual prepared and maintained, with county input, by the Property Tax Division of the Minnesota Department of Revenue. It is intended as a guide for county auditors and county land commissioners to use in the administration of the law concerning property tax delinquency and tax Forfeiture of real property.

9 Examples are given throughout the Manual to illustrate processes and concepts. The cases are fictional situations that are purely educational and not intended to criticize or embarrass any individuals or groups. Any connection between the fictitious names and places and any real persons or places is purely coincidental. Not every potential Delinquent tax or tax Forfeiture situation is covered in this Manual . If you have questions about specific circumstances, please contact the Department of Revenue for further consultation. Because seizure of the property is the final step, the Delinquent real property tax laws are purposefully set up to assure that all of the steps leading to the seizure and sale of real property are legally justifiable.

10 The complex set of provisions gives the taxpayer every chance to pay and makes the taxpayer clearly aware of the consequences of not paying the taxes before the confiscation of the real property. Only then can the title to the real property be justifiably acquired by the state and transferred to the purchaser of the property. The Minnesota Legislature has gradually built the major provisions of the Delinquent real property tax laws into four chapters in statute: Minnesota Statutes, Chapter 279: Delinquent Real Estate Taxes Minnesota Statutes, Chapter 280: Real Estate Tax Judgment Sales Minnesota Statutes, Chapter 281: Real Estate Tax Sales and Redemption Minnesota Statutes, Chapter 282: Tax-Forfeited Land Sales Stages of Property Tax Delinquency and Forfeiture The property tax delinquency and Forfeiture process can be broken down into six stages: 1.