The property tax delinquency and tax forfeiture process for real estate property can be broken down into the basic phases listed below.
Taxes are considered delinquent on the first business day in January of the following year the taxes were due. At that point, the penalty rate increases, and interest is charged on the unpaid tax, penalty, and fees. Each year, the county starts delinquent tax proceedings against the first-year delinquent properties. A ‘tax judgment’ is entered against the property for the delinquent amount due. This starts the clock ticking toward tax forfeiture.
Generally, property owners have three years to pay all delinquent taxes and avoid tax forfeiture on the property. This is called the Period of Redemption.
Partial payments are accepted. In accordance with state law, payments are applied first to penalties, then to interest, fees, and taxes. For properties with more than one year of delinquency, taxes are paid in inverse order of the due date.
Expiration of Redemption
After three full years, a formal notice of pending forfeiture is given to the taxpayer in four ways: certified mail, published in the official newspaper of record, posted in the office for public viewing and personal service to the property. To stop the forfeiture process, the delinquent taxes are to be paid in full or entered into a Confession of Judgment payment plan.
After land is forfeited, ownership is transferred to the State of Minnesota where it is held in trust for the taxing jurisdictions. All taxes and special assessments at the time of forfeiture are canceled. For a period of time, a previous owner can go through the repurchase process.
A classification process takes place to determine whether the land will remain in public ownership and be managed for public benefit, or if it will be returned to private ownership via sealed bid auction.