Detailed Answer
When a property owned solely by a deceased spouse generates surplus proceeds—often after a tax sale or foreclosure auction—those funds become part of the decedent’s estate. Arkansas law directs how to claim and distribute these surplus proceeds.
1. Surplus Proceeds After a Tax Sale
Under Ark. Code Ann. § 26-37-112, any excess money remaining after satisfying taxes, penalties, interest, fees, and sale costs must be paid to the landowner or the owner’s legal representative, heirs, or assigns. If the original owner died before claiming the surplus, the personal representative of the estate may file a claim on behalf of the estate.
Statute link: Ark. Code Ann. § 26-37-112.
2. Surplus Proceeds After a Foreclosure Sale
Foreclosure under Ark. Code Ann. § 18-50-104 requires the commissioner or trustee to apply sale proceeds first to debts and costs, then to deliver any residue to the persons lawfully entitled. If the decedent outlived the sale but died before claiming surplus funds, the estate’s personal representative may step in to recover the excess.
Statute link: Ark. Code Ann. § 18-50-104.
3. Who Qualifies to Claim?
- Personal Representative: The executor or administrator of the decedent’s estate must file the initial claim and collect the funds.
- Heirs and Devisees: If there is no will, intestate succession rules apply. Under Ark. Code Ann. § 28-9-201, the surviving spouse and children inherit according to statutory shares:
- No children or parents: Spouse inherits all.
- Children only with surviving spouse: Spouse receives one-half; children share one-half.
- Children from another relationship: Spouse receives one-half; children share one-half.
- Other Successors: If no spouse or descendants, parents or siblings may claim under intestacy.
Statute link: Ark. Code Ann. § 28-9-201.
4. Deadlines and Documentation
Arkansas law allows one year from the sale date to claim surplus proceeds. The personal representative must submit:
- Certified death certificate
- Letters testamentary or letters of administration
- Proof of heirship or will
- Sale and surplus notices
Failing to file within one year may forfeit the right to claim, and funds may escheat to the county or state.
Helpful Hints
- Contact the county treasurer or circuit clerk’s office for specific procedures.
- Engage a probate attorney or clerk to handle filings and deadlines.
- Gather certified copies of all estate and death documents early.
- Review any will or trust to determine if surplus proceeds pass outside probate.
- Act promptly—statutory time limits are strict.
- Keep records of all communications with county and court officials.