Recovering Surplus Funds After a Georgia Tax Sale: FAQ and Step-by-Step Guide

Disclaimer: This is general information only and is not legal advice. I am not a lawyer. If you need legal advice about recovering surplus funds after a tax sale in Georgia, contact a licensed attorney.

Detailed Answer: How surplus funds are handled after a Georgia tax sale

When a Georgia county sells property for unpaid taxes, the sale may generate proceeds in excess of the taxes, interest, penalties, fees, and sale costs. Those excess proceeds are commonly called “surplus funds” or “overage.” Under Georgia law, surplus funds do not belong to the tax purchaser; they belong to parties with a prior legal interest in the property (for example, the former owner or junior lienholders). The county is responsible for holding and distributing proceeds according to statutory rules.

Key state law that governs tax sales and the handling of sale proceeds appears in the Official Code of Georgia Annotated (O.C.G.A.), Title 48 (Revenue and Taxation), Chapter 4. See, for example, O.C.G.A. § 48-4-40 for provisions dealing with sale and distribution. For the precise statutory language and any updates, review the code at the Georgia General Assembly website: https://www.legis.ga.gov/legislation/ocga/48-4-40 and the chapter index at https://www.legis.ga.gov/legislation/ocga/48-4.

Who can claim surplus funds?

The former record owner of the property (or the owner’s heirs or successors whose ownership interest existed before the sale).
Junior lienholders whose liens were on the property before the tax lien. These lienholders may have a right to part of the surplus, depending on lien priority and amounts owed.
Other persons who can prove a legally recognized, pre-sale interest in the property.

Typical step-by-step process to recover surplus funds in Georgia

Confirm the sale and the surplus amount. Contact the county tax commissioner’s office, county clerk, or sheriff’s office that conducted the sale. Ask for the sale docket, sale ledger, and any record of surplus proceeds. Counties maintain sale records and can tell you whether surplus funds exist and the amount.
Determine whether you have a legal claim. You must be able to prove you had an ownership interest (deed, heirship documents) or a recorded lien (mortgage, judgment) that predated the tax lien/sale. If you are a successor in interest, get certified documents that show your chain of title.
File a formal claim where the county directs. Counties often require a written claim or affidavit and supporting documentation. Some counties have a claim form; others will accept a notarized affidavit plus copies of title documents. If the county requires a court proceeding to resolve competing claims, the county may deposit the funds with the superior court or initiate an interpleader. Check with the county tax commissioner’s office for its procedures.
Provide proof of identity and interest. Expect to submit government ID and certified copies of deeds, recorded liens, mortgages, assignments, or probate documents that demonstrate your right to the funds.
Be aware of procedural deadlines and requirements. Georgia law and local procedures impose deadlines and documentation standards. Missing deadlines or failing to perfect a claim can forfeit recovery. Review the relevant O.C.G.A. provisions and county instructions carefully or ask an attorney to review deadlines that may apply to your situation (for example, whether the county has statutory or local rules for claim periods or distribution).
If the county refuses or there is a dispute, consider court action. If the county will not release funds or multiple parties claim the same surplus, the dispute is often resolved in the local superior court. You (or the county) may need to file a petition for interpleader or a claim for distribution so the court can determine rightful ownership. In contested matters, evidence of priority, dates, and amounts will be crucial.
Collect the funds or appeal. If the county or court determines you are entitled to the surplus, the county will release the funds (sometimes after a small administrative fee). If your claim is denied, you may have the right to appeal or to ask the court to reconsider, subject to Georgia civil procedure rules.

What usually happens to unclaimed surplus funds?

If surplus funds remain unclaimed for an extended period, local rules or state law may allow the county to retain or transfer those funds to a designated county fund, or to follow a statutory escheat process. Each county may have procedures for handling unclaimed funds; contact the county tax commissioner’s office for specifics.

When to hire an attorney

If multiple claimants exist, the amount is substantial, or the county directs you to court proceedings, consult a Georgia attorney familiar with tax-sale and real property law. An attorney can file claims correctly, collect documentation, and represent you in superior court if needed.

Helpful Hints

Contact the county tax commissioner or clerk immediately after learning of a tax sale—records and deadlines move quickly.
Obtain certified copies of deeds, recorded mortgages, and any recorded assignments to prove your interest.
Keep careful records: sale notices, tax bills, payment receipts, and communications with the county.
Ask the county whether it has a formal claim form and what documentation it requires before you submit a claim.
If you are a mortgage or lienholder, check whether your lien was foreclosed or extinguished by the sale; your share of surplus depends on lien priority and amounts owing.
If the county deposits funds into superior court (interpleader), act quickly—court timelines and filing requirements are strict.
Remember that mistakes in identity or chain-of-title documents slow or prevent recovery—use certified records where possible.
Consider hiring an attorney when the facts are complex or when competing claims exist; attorneys can also calculate priority and prepare court filings.
Review O.C.G.A. Title 48, Chapter 4 for statutory authority and any deadlines referenced by the county: https://www.legis.ga.gov/legislation/ocga/48-4 and specific provisions such as O.C.G.A. § 48-4-40.

If you want, tell me the county where the sale occurred and any documents you already have (deed, mortgage, sale notice), and I can give more tailored next steps you can take to start a claim in that county.