Home » US Supreme Court rules that government cannot keep profit from properties sold to satisfy tax debt

US Supreme Court rules that government cannot keep profit from properties sold to satisfy tax debt

by Derek Andrews
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The US Supreme Court docket ruled Thursday that the federal government can not hold the earnings of properties bought to repay tax money owed. The court docket reached this determination within the case of Tyler v. Hennepin County, Minnesota, et al., whereby a neighborhood Minnesota authorities bought off a lady’s rental to fulfill her tax invoice.

The case centered round Geraldine Tyler, a 94-year-old girl, whose rental was bought by Hennepin County, Minnesota to fulfill her tax invoice. Tyler initially bought the rental in 1999, and lived there alone till 2010 when her household moved her right into a senior assisted dwelling neighborhood. When she moved out of the rental, the property tax invoice was forgotten by the household. By 2015, the rental had incurred $2,300 in unpaid property taxes and $13,000 in curiosity and penalties.

In 2015, Hennepin County seized the property, as permitted beneath Minnesota Statute §§281.18, 282.07, and bought it for $40,000. The county used $15,000 to repay the property tax debt, however stored the surplus $25,000 for their very own use. The county cited Minnesota Statute §282.08, which states that any proceeds in extra in the course of the sale of a seized property could also be stored by the county. Tyler argued, nevertheless, that this was unconstitutional beneath the Takings Clause of the US Structure’s Fifth Amendment.

The bulk agreed with Tyler.Writing for almost all opinion, Chief Justice Roberts acknowledged:

The Takings Clause “was designed to bar Authorities from forcing some folks alone to bear public burdens which, in all equity and justice, must be borne by the general public as an entire.” Armstrong, 364 U. S., at 49. A taxpayer who loses her $40,000 home to the State to meet a $15,000 tax debt has made a far larger contribution to the general public fisc than she owed. The taxpayer should render unto Caesar what’s Caesar’s, however no extra.

The court docket cited help from a number of precedent instances and noting that almost all of states wouldn’t uphold such a statute. The court docket concluded that, by maintaining the surplus revenue, the county was primarily performing a taking of personal property, which is regulated by the Takings Clause.

Source / Picture: jurist.org

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