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TDC Asks Supreme Court to Hear Two Cases Protecting Taxpayers from Greedy State Revenue Agencies


By Travis Nix, National Taxpayers Union

The Supreme Court has a historic opportunity this term to protect taxpayers from greedy state revenue agencies that all too often punish their residents with punitive fines for falling behind on their taxes. The Taxpayer Defense Center has asked the Supreme Court to hear two cases that could put an end to two of the most cruel and unjust property tax schemes in Minnesota and Nebraska where local governments confiscate homes due to a few unpaid dollars in property taxes.

In Minnesota, a 93-year-old resident’s home was confiscated and sold for $40,000 due to $15,000 in unpaid property taxes and fines. The government kept the entire $25,000 windfall and the former homeowner received nothing.

In Nebraska, a local county transferred a home worth over $60,000 to a private developer for only $5,200 in unpaid property taxes and fines. It is a government enabled scheme that allows private developers and the government to prey on residents who have fallen on tough economic times.

Minnesota and Nebraska are two of 14 states that engage in this cruel practice of confiscating taxpayer homes and retaining the entire home windfall. The rest of the states follow the right –and constitutionally mandated– practice of returning the excess proceeds from a foreclosure sale to the former homeowner or appropriate creditor.

The only interest the state has in the property is the unpaid tax; anything above that amount is punitive and belongs either to the homeowner or a creditor.

The Taxpayer Defense Center’s two amicus curiae (“friend of the court”) briefs asked the Supreme Court to hear both cases and strike down the property tax schemes as unconstitutional violations of the Eighth Amendment’s Excessive Fines Clause.

All Americans have a fundamental right to be free from excessive government fines and punishments. These state property tax schemes are clearly punitive and grossly disproportionate to the offense of a few thousand dollars in unpaid property taxes, making them unconstitutional.

Our brief outlines how this right can be traced all the way back to the Magna Carta and was a critical right at our nation’s founding. Yet, courts have been reluctant to use the doctrine to protect taxpayers as it only became a part of American legal jurisprudence over the last few decades despite being enshrined in the Constitution. For far too long, this fundamental freedom has been a right Americans only have on paper and not in practice.

The Excessive Fines Clause could be a game changer for taxpayers. A strong Excessive Fines jurisprudence could save them from punitive and excessive government fines greedy revenue agencies often impose on taxpayers for honest mistakes.

The Taxpayer Defense Center will be monitoring whether the Supreme Court grants certiorari to hear this case. It is proud to stand up for taxpayers fighting unjust and excessive government penalties.


Travis Nix writes for the National Taxpayers Union.