Tyler v. Hennepin County
The Unanimous Ruling That Changed Tax Sales
In 2023, the Supreme Court ruled 9-0 that counties cannot keep surplus equity after tax sales. In 2026, Pung v. Isabella County confirmed that floor and set how the surplus is measured: the auction price minus the debt, in a fairly conducted sale.
Geraldine Tyler's Story
Geraldine Tyler, 93 years old
Owned a one-bedroom condo in Hennepin County, Minnesota. Fell behind on property taxes after moving to a senior community.
The Taking
Hennepin County kept the entire $25,000 surplus under Minnesota law. Geraldine Tyler received nothing beyond the statutory redemption period. She sued, arguing this violated the Fifth Amendment Takings Clause.
Supreme Court Ruling
Unanimous SCOTUS ruling (9-0) authored by Chief Justice Roberts. Counties must return surplus equity above the tax debt. Keeping the $25,000 was an unconstitutional "taking" requiring just compensation under the Fifth Amendment.
The Impact Timeline
Key Quote from the Opinion
The taxpayer must render unto Caesar what is Caesar's, but no more. A taxpayer who loses her $40,000 house to the State to fulfill a $15,000 tax debt has made a far greater contribution to the public fisc than she owed. The Takings Clause "was designed to bar Government from forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole."
Mid-Atlantic States: Tyler Compliance Status
| State | Sale Type | Tyler Status | Notes |
|---|---|---|---|
| Washington, DC | Tax Lien | Affected | 18% statutory rate. Surplus rules under review post-Tyler. |
| Maryland | Tax Lien | Affected | 6-20% by county. County-level surplus practices vary. |
| Virginia | Tax Deed (judicial) | Affected | Judicial sale process. Surplus distribution rules apply. |
| Delaware | Sheriff's Sale | Affected | 9.3% delinquency rate. Surplus treatment post-Tyler unclear. |
| Pennsylvania | Upset/Judicial Sale | Affected | Two-phase sale process. Upset sales first, then judicial. |
Compliance status reflects ArrearIQ's assessment as of February 2026 and does not constitute legal advice. Consult counsel for jurisdiction-specific guidance.
The Question Tyler Left, Now Answered
How is the surplus measured?
Tyler established that surplus equity must be returned but did not say how to measure it. On June 23, 2026, Pung v. Isabella County answered: the auction price minus the debt, in a fairly conducted sale, not fair market value. The one question still open is what makes a sale fairly conducted, which the Court sent back to the lower courts.
Read the Pung rulingWhat this means now
Post-Pung, the surplus floor is settled and the contested upside lives in sales that were not fairly conducted. ArrearIQ computes the floor and frames the gap.
Get the post-Pung briefing
How the decided ruling reshapes surplus recovery.
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