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Ask Dr. Fiona Chen Your Own Question
Dr. Fiona Chen
Dr. Fiona Chen, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 482
Experience:  Former IRS Revenue Agent
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What are the laws regulating the reclaiming of excess funds

Customer Question

What are the laws regulating the reclaiming of excess funds resulting from tax-sales of foreclosed homes?
Submitted: 7 months ago.
Category: Tax
Expert:  Dr. Fiona Chen replied 7 months ago.

Dear Customer,

You want to start with the process as soon as possible.

Below is an example for the Orange County, California website. There is a one year time frame for us to claim. Please go to the property's county to start the process on the coming Monday, for example, if not today.

The quotations of laws and forms are procedures for the property tax sales. If it is mortgage foreclosures, they may not apply.--Just a side note.

Regards,

Fiona

Fiona Chen, MPA, Ph.D., CPA, ABV, CFF, CITP

The right to claim excess proceeds expires one year from the recording date provided for each property. Please check the listings above for applicable recording dates.

http://ttc.ocgov.com/proptax/pta/excess

Instructions For Filing A Claim For Excess Proceeds

Pursuant to California Revenue and Taxation Code Section §4675, any party of interest in a property sold at public auction may file with the county a claim for the excess proceeds, in proportion to his or her interest held with others of equal priority in the property at the time of sale, at any time prior to the expiration of one year following the recordation of the tax collector's deed to the purchaser. Parties of interest and their order of priority are:

  1. First, lien holders of record prior to the recordation of the tax deed to the purchaser in the order of their priority.
  2. Second, any person with title of record to all or any portion of the property prior to the recordation of the tax deed to the purchaser.

In order to make a claim for the excess proceeds, please complete the Excess Proceeds Claim Form along with documentation to support your claim as follows:

1. If you are a party of interest as defined in (a) above, attach a copy of the trust deed or other evidence of lien or security interest which sets forth the original amount of the lien or interest, the total amount of payments received reducing the original amount of the lien or interest, and the amount still due and payable as of the date of sale of the tax-defaulted property auction held by the Tax Collector.

2. If you are a party of interest as defined in (b) above, attach copies of all documents (e.g. deed, death certificate, will, court order, etc) supporting your claim.

In order for the Excess Proceeds Claim to be considered by the Orange County Tax Collector, claims must be received by the Tax Collector on or before the expiration of one year following the date of recordation of the deed to purchaser. If a claim is approved, the Orange County Auditor-Controller will issue a check for payment. By law, the Auditor-Controller cannot issue a check for payment of an approved claim until 90 days following the action taken by County Counsel if multiple claims are received.

Please mail completed forms and supporting documentation to:

Orange County Treasurer-Tax Collector
c/o Excess Proceeds Claims
P. O. Box 1438
Santa Ana, CA.###-##-####/strong>