Short answer

After a Florida tax deed sale, any surplus funds are held by the clerk of court. The surplus is the amount the property sold for above the unpaid taxes and the costs of the sale. For homestead property, the opening bid also includes one-half of the assessed value, and that amount is part of the surplus too. The order in which surplus funds are paid is set by law, and former owners must follow specific steps and deadlines to claim their share.

Why it matters

Losing a property to a tax deed sale can be overwhelming, but understanding surplus funds is important because:

  • You may be entitled to money left over after the sale, even if you lost the property.
  • The surplus can be a significant sum, especially if the property sold for more than the taxes owed and costs of sale.
  • Missing deadlines or misunderstanding the process can mean losing out on funds you could otherwise receive.
  • The process is different from a mortgage foreclosure, so rules you may have heard about foreclosures do not apply here.

For example, if your home was sold at a tax deed auction, you could still recover some funds if there was a surplus, but you need to act within the required timeframe.

Steps

If you are a former owner whose property was sold at a Florida tax deed sale, here’s how the surplus process works:

Tax deed sale occurs When property taxes go unpaid, the holder of a tax certificate can apply for a tax deed. The clerk of the circuit court then sells the property at a public auction. This is a different process from a mortgage foreclosure.

Surplus funds are determined The surplus is the amount the property sold for above the unpaid taxes and the costs of the sale. For homestead property, the opening bid also includes one-half of the assessed value, and that amount is part of the surplus too. The clerk of court holds the surplus funds after the sale.

Notice of surplus is mailed The clerk of court mails a notice of surplus funds to all parties who may have an interest, including the former owner and any lienholders.

Filing a claim To claim surplus funds, a sworn written claim must be filed with the clerk of court within 120 days of the date of the notice. Lienholders who do not file within 120 days are barred from receiving payment. This bar does not apply to the property owner.

Distribution of surplus The clerk pays governmental liens first. Next, other lienholders are paid, with senior liens paid before junior liens. Any remaining surplus goes to the former owner (the titleholder of record). If there are conflicting claims, the clerk may ask the circuit court to decide who is paid, in a case called an interpleader.

If no claim is filed If no claim is filed within 120 days, the titleholder of record is presumed entitled and the funds are handled under Florida’s unclaimed property law. The firm also represents former owners, and the beneficiaries of owners who have died, in claims for surplus that has been sent to the Florida Department of Financial Services.

Example

This is a hypothetical example for illustration only.

Suppose your homestead property is sold at a tax deed auction for $150,000. The unpaid property taxes and costs of sale total $20,000. The assessed value of the homestead is $100,000, so the opening bid includes $50,000 (one-half of the assessed value). The surplus is calculated as follows:

  • Sale price: $150,000
  • Minus unpaid taxes and costs: $20,000
  • The opening bid included $50,000 (one-half of the assessed value) for homestead property, and that $50,000 is part of the surplus too.
  • Total surplus held by the clerk of court: $130,000

Distribution order:

  1. Governmental liens are paid first (for example, unpaid code enforcement fines).
  2. Any other lienholders are paid next, in order of priority.
  3. The remaining surplus goes to you, the former owner.

Tip: If you receive a notice of surplus funds from the clerk of court, review it promptly and consider your options for filing a claim within 120 days.

Common pitfalls

  • Missing the 120-day deadline: Lienholders who do not file a claim with the clerk of court within 120 days lose their right to the surplus. The property owner is not barred by this deadline, but waiting can complicate the process.
  • Confusing tax deed sales with mortgage foreclosures: The rules and timelines are different. Do not rely on foreclosure advice for a tax deed surplus.
  • Not understanding the surplus calculation: For homestead property, one-half of the assessed value is part of the surplus, even if no one bids above the opening bid.
  • Overlooking governmental liens: These are paid first from the surplus, which can reduce the amount available to other lienholders and the former owner.
  • Failing to respond to the clerk’s notice: Ignoring the notice or not filing a claim can delay or complicate payment.
  • Assuming you need a lawyer to file a claim: As the former owner, you may file a claim directly with the clerk of court.

Summary

  • The surplus from a Florida tax deed sale is the amount the property sold for above the unpaid taxes and sale costs. For homestead property, one-half of the assessed value is also part of the surplus.
  • The clerk of court holds the surplus and mails a notice after the sale.
  • Governmental liens are paid first, then other lienholders, then the former owner.
  • A sworn written claim must be filed with the clerk within 120 days of the notice. Lienholders who miss this deadline are barred, but the property owner is not.
  • If no claim is filed, the funds are handled under Florida’s unclaimed property law. Next steps:
  • If you have received a notice of surplus funds, review it carefully and consider filing a claim with the clerk of court within 120 days.
  • If you have questions about your rights or the process, consider seeking legal advice specific to your situation.

This page provides general information and does not create an attorney-client relationship.

Important information

Attorney advertising. Responsible attorney: Christian Cruz, Esq. Office: CRUZ LAW FIRM, 160 W Camino Real, 589, Boca Raton, FL, 33432.

Florida law does not require you to hire a lawyer or anyone else to claim tax deed surplus funds. A former owner may file a claim with the clerk of court directly.

This page is general information about Florida law, not legal advice. Reading it does not create an attorney-client relationship, and no such relationship is formed until we have a signed written agreement.

Fee arrangements depend on the posture of the matter and are set out in a written agreement before any work begins. We are glad to explain how fees would work in your situation when we speak.

FAQ

What is a surplus after a Florida tax deed sale?

The surplus is the amount the property sold for above the unpaid taxes and the costs of the sale. For homestead property, the opening bid also includes one-half of the assessed value, and that amount is part of the surplus too.

Who holds the surplus funds after a tax deed sale in Florida?

The surplus is held by the clerk of court after the tax deed sale.

What is the order of payment for surplus funds?

Governmental liens are paid first, then other lienholders (senior before junior), and finally the former owner (titleholder of record).

How long do I have to file a claim for surplus funds?

A sworn written claim must be filed with the clerk of court within 120 days of the date of the notice of surplus funds. Lienholders who do not file in that time are barred, but this does not apply to the property owner.

What happens if no claim is filed within 120 days?

If no claim is filed within 120 days, the titleholder of record is presumed entitled and the funds are handled under Florida’s unclaimed property law.