How to Recover Surplus Funds from Tax Foreclosure Sales in Arkansas
If your property in Arkansas was sold for delinquent taxes, you may have money waiting to be claimed — money that the government is not going out of its way to tell you about. When tax-delinquent property sells for more than what was owed, the leftover money — called surplus funds or overages — may belong to you, the former property owner.
Across the country, billions of dollars in surplus funds sit unclaimed. In Arkansas, if you do not claim yours within the time allowed, the money escheats (is permanently taken) by the county government. That means taxpayer money goes right back to the government instead of to the people it belongs to.
How It Works in Arkansas
In Arkansas, the Commissioner of State Lands handles the sale of tax-delinquent properties. Under Section 26-37-205 (Distribution of Funds), after the Commissioner takes a small administrative fee (10% of the remaining funds up to a maximum of $500), the rest of the surplus is supposed to go back to you — the former owner.
But here is the problem: the Commissioner does not always come looking for you. The burden is on you to file an application requesting the release of the funds. If you do not know the money exists, or if you do not know how to claim it, it eventually disappears into county coffers.
Who Qualifies as a "Former Owner"
Arkansas defines "former owner" quite specifically. You must be a person, partnership, corporation, or other legal entity that held record title to the property on the date it was sold by the Commissioner of State Lands. This is an important detail.
Equally important: the definition does not include heirs or relations beyond the first degree of consanguinity (which means parents and children). If you are a sibling, grandchild, or more distant relative of the record owner, you may not qualify to claim the surplus under this statute.
Think you might be owed surplus funds? Check for free at AuctionBlock.org — it takes 2 minutes, costs nothing, and we only charge a flat fee if we recover your money.
Steps to Claim Your Surplus Funds
- Contact the Commissioner of State Lands and ask about surplus funds from your property's sale. You can also check with the County Tax Collector for information.
- Request the official application form for release of funds from the Commissioner's office.
- Gather your proof of ownership: deed, title records, or other documentation showing you were the record title holder at the time of the sale.
- Complete and submit the application with all required documentation, including any additional information the Commissioner deems necessary.
- Sign the release deed: You will need to formally relinquish all rights, title, and interests in the tax-delinquent land as a condition of receiving your surplus funds.
- Receive your funds: Under the law, all funds must be made payable directly to you, the former owner. No funds can be paid to any other person or entity without a court order.
A word of warning: filing a fraudulent claim is punishable as a Class D felony in Arkansas, and anyone whose claim results in an erroneous payment is responsible for repaying all funds. Only file if you are genuinely entitled.
Critical Deadlines You Must Know
- 1 year is the general collection window for tax sale overages before complications increase.
- 3 years for funds placed in escrow on or after July 1, 2005 — after that, the money escheats to the county where the property is located.
- 5 years for funds placed in escrow before July 1, 2005.
Do not wait. Once funds escheat to the county, they become county property and are extremely difficult — if not impossible — to recover.
Fee Protections That Protect You
Arkansas has some of the strongest fee protections in the country for surplus fund claimants under Section 26-37-205(b)(2)(F):
- Recovery assistance fees are capped at 10% of the recovery amount
- The agreement must be in writing, signed by the former owner
- It must clearly describe the property and services to be provided
- It must state the value of the funds before and after the fee is deducted
- All funds must be paid directly to you — no one else can receive your money without a court order
- Agreements with unconscionable compensation are unenforceable, and you can sue to reduce the fee
If anyone asks you to pay more than 10%, that agreement is unenforceable under Arkansas law. Know your rights.
Free Help from AuctionBlock.org
AuctionBlock.org is a mission-driven company that helps former property owners recover surplus funds for a flat $4,999 fee, paid only upon successful recovery — well below even Arkansas's 10% cap. We can help you:
- Find out if surplus funds exist from your property's sale
- Complete the Commissioner of State Lands application correctly
- Gather the right documentation to prove your ownership
- Meet the deadlines before your money is permanently lost to escheatment
You do not have to pay anyone to get back what is rightfully yours. Contact AuctionBlock.org today — our help is always free.
Visit AuctionBlock.org to get started.
Tyler v. Hennepin County: A Landmark for Property Owners
In 2023, the U.S. Supreme Court ruled unanimously in Tyler v. Hennepin County that governments cannot keep surplus proceeds from tax sales beyond what is owed, finding this violates the Takings Clause of the Fifth Amendment. This landmark decision has strengthened property owners' rights to surplus funds nationwide, and as of 2026, laws in this area are evolving rapidly. Many states have enacted or are considering reforms in response to this ruling. We strongly recommend verifying current statutes in your state, as the legal landscape may have changed since this guide was written.
AuctionBlock.org is a mission-driven company providing surplus fund recovery assistance. This guide is for educational purposes only and does not constitute legal advice. Laws change frequently — always verify current statutes with a licensed attorney in your state. Last updated: April 2026.