"At issue is whether a county can seize a homeowners residence for unpaid property taxes and sell the house at auction for less than the homeowners would get if they put their home on the market themselves. In 2023, the Supreme Court ruled that when a government entity puts up a house for foreclosure or auction in order to collect back taxes, the government has to give the taxpayer any proceeds beyond the taxes due."
"The case was brought by the estate of Timothy Pung, whose family lived in the house without settling the estate for more than a decade. Isabella County, Mich., advised the estate executor in 2012 that the estate owed roughly $2,000 in back taxes. What followed was a long legal fight, with the Michigan state and federal courts ultimately upholding a foreclosure sale of the house for $76,000."
"The homeowners, however, appealed to the U.S. Supreme Court, contending that if the house had been placed on the open market, instead of an auction sale, the value of the home would have been $194,000—the amount it sold for close to two years later."
The Supreme Court heard arguments in a case challenging whether government entities can seize and auction homes for unpaid property taxes without compensating owners for the difference between auction proceeds and fair market value. The case involves Timothy Pung's estate in Michigan, where Isabella County foreclosed on a home for approximately $2,000 in back taxes. The house sold at auction for $76,000 but would have fetched $194,000 on the open market two years later. Property rights advocates argue delinquent taxpayers deserve fair market value compensation, while the government maintains current foreclosure auction procedures are sufficient. The 2023 Supreme Court ruling required governments to return surplus proceeds to taxpayers, but this case seeks to expand protections further.
Read at www.npr.org
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