Claiming surplus (overage) from a tax foreclosure sale in South Dakota: A step-by-step FAQ

Detailed answer

What are surplus funds?
When a county sells property to collect unpaid property taxes, the sale price can exceed the total amount owed (taxes, penalties, interest, costs, and any valid lien amounts paid by the purchaser). The extra money left over after those amounts are paid is commonly called surplus funds, overage, or an overbid return. That money belongs to certain entitled parties — usually the prior owner, and sometimes lienholders and other judgment creditors — not to the purchaser at the tax sale.

Who can claim surplus funds in South Dakota?
Typically the highest-priority claimant is the former owner of the property (your mother, in your situation). If the owner has died, the owner’s heirs or personal representative may be entitled to the funds. Other parties with recorded liens or judgments that were paid out of the sale may also have a right, according to their priority. Priority and exact entitlement depend on the sale mechanics and South Dakota law and county procedures.

Where to start — locating the surplus:

Find the tax sale record. Start at the county treasurer’s office (or the sheriff’s office if your county uses the sheriff to conduct sales) where the property was located. Ask for the tax sale or tax deed file for the property.
Confirm whether the sale produced surplus funds. County records will show sale bid amount, amount applied to taxes/costs, and whether an overage exists. The county treasurer or register of deeds can tell you whether a surplus exists and whether the county is holding it.
Check who is listed as the former owner in the deed and whether the owner (your mother) is deceased or alive.

How to make a claim if your mother is alive:

Contact the county treasurer or the official holding the funds and ask for the county’s required claim form or procedure for surplus funds. Different counties may have slightly different documentation requirements or forms.
Prepare proof of ownership: a deed, old tax bill, or other documents showing your mother’s ownership prior to the sale. Provide government ID for the claimant and any required notarized statements.
If you are acting on her behalf, provide a valid power of attorney that specifically authorizes you to claim money on her behalf. Counties typically require an original or certified copy of a power of attorney.
Submit the claim with certified copies of identity and ownership proof, any claim form, and any additional county-required documents. Keep copies of everything submitted.

How to make a claim if your mother is deceased:
If the owner has died, the county will typically require that the person claiming surplus funds be authorized to handle the decedent’s assets. That generally means either a personal representative (executor/administrator) appointed by a probate court or someone qualified under the state’s small‑estate procedures.

Open a probate (or obtain letters of administration) if required. A county court can appoint a personal representative who can then claim the surplus.
If the estate qualifies for a small‑estate affidavit (South Dakota provides simplified procedures for certain low‑value estates), you may be able to use that affidavit and a certified death certificate to claim the surplus without formal probate. Check the South Dakota court rules and county probate procedure.
Provide the county with certified copies of the death certificate and the document that shows you are authorized to collect (letters testamentary, letters of administration, or a small‑estate affidavit), plus any identification the county requires.

Timing and deadlines
Many states impose strict time limits for claiming surplus funds or set procedures that must be followed promptly. Because those deadlines vary and can affect your rights, contact the county treasurer immediately after discovering a possible overage. The South Dakota Codified Laws and your county webpages provide the controlling rules and timelines; see the South Dakota Codified Laws general entry for reference: https://sdlegislature.gov/Statutes/Codified_Laws.

Required documents — common checklist

Proof of identity (government photo ID).
Proof of former ownership (deed, tax bill, mortgage, or other title documents).
If claiming for a deceased owner: certified copy of the death certificate.
If you act for the owner: valid power of attorney (original or certified copy) or letters testamentary/administration, or small‑estate affidavit as applicable.
Completed county surplus claim form (if the county provides one).
Any notarizations or certified copies the county requires.

If the county denies your claim or another party disputes it
If the county refuses to release surplus funds, or if another party claims priority, you may need to file a petition in the county court to determine entitlement. South Dakota’s court system handles probate and civil petitions that resolve competing claims. For information about county court procedures, see the South Dakota Unified Judicial System: https://ujs.sd.gov.

Fees and third‑party claim services
Be cautious about companies that advertise to find and claim surplus funds for a large commission. Counties usually permit the owner or authorized representative to claim funds directly. If you hire someone, get a clear written fee agreement and verify the company’s reputation. Avoid signing over all rights to the funds without understanding consequences.

Where to get authoritative local help
– Contact the county treasurer or register of deeds for the county where the property sits. County offices administer tax collections and maintain sale records.
– For questions about probate or establishing authority to claim on behalf of a deceased owner, contact the county probate court or consult the South Dakota Unified Judicial System resources: https://ujs.sd.gov.
– For general tax questions and property tax information, see the South Dakota Department of Revenue: https://dor.sd.gov.

Helpful Hints

Act quickly. Counties may have time limits or re‑disbursement procedures that make early action important.
Start with the county treasurer or sheriff — they hold the sale records and the funds. Request a written statement showing what the sale produced and whether a surplus exists.
Get certified copies. Courts and county offices often require certified copies of death certificates, probate papers, and powers of attorney.
If your mother lacks capacity but is alive, a valid power of attorney is usually required before you can claim on her behalf.
If your claim is contested or the county won’t release funds, consider consulting a South Dakota attorney experienced in tax sales or probate to evaluate your options and to file any necessary court petitions.
Beware scams. Don’t pay large upfront fees to third parties promising to recover surplus funds without seeing written proof the county is holding money and without checking their credentials.
Keep careful records of every contact, document submitted, and any county statements. A clear paper trail helps if disputes arise.

Quick checklist to begin

Identify the county where the property was located.
Contact the county treasurer or sheriff to confirm whether a surplus exists and ask for the county’s claim procedure.
Gather ID, proof of prior ownership, and, if applicable, death certificate and probate/letters or small‑estate papers.
Complete the county claim form (if any) and submit with required documentation.
If you hit obstacles, consult the county probate court or a local attorney for next steps.

Important note and resources
Because procedures and deadlines vary by county, always confirm the exact steps and document lists with the county that conducted the tax sale. For South Dakota statutory materials and to view state law on taxation and probate, see the South Dakota Codified Laws: https://sdlegislature.gov/Statutes/Codified_Laws. For state tax office information: https://dor.sd.gov. For probate and court forms: https://ujs.sd.gov.

Disclaimer
This article is for general informational purposes only and is not legal advice. It does not create an attorney‑client relationship. For advice about a specific situation, contact a licensed South Dakota attorney or the county officials who handled the tax sale.