New Hampshire handles tax sales at the municipal level, with each city and town responsible for its own tax collection and enforcement. When a property owner falls behind on taxes, the municipality initiates a tax deeding process after approximately two years of delinquency. If the property is later sold and the sale produces more than the amount owed, the excess becomes surplus funds. Under RSA 80:88, the municipality is required to interplead that surplus with the superior court, which then determines who is entitled to the money. This process is unique to New Hampshire and creates a specific path for former property owners to recover what is rightfully theirs.
How New Hampshire Tax Deeding Works
In New Hampshire, when property taxes remain unpaid for two years, the municipality can take a tax deed to the property. This transfers ownership from the delinquent taxpayer to the city or town. The municipality may then sell the property to recover the outstanding taxes, interest, penalties, and administrative costs. If the sale price exceeds the total amount owed, the difference is surplus. Under RSA 80:88, the municipality cannot simply keep these excess proceeds. Instead, the law requires the municipality to file an interpleader action with the superior court, depositing the surplus funds with the court for proper distribution. The court then reviews competing claims and determines who is entitled to the money, which in most cases is the former property owner.
The RSA 80:88 Interpleader Process
The interpleader process under RSA 80:88 is a distinguishing feature of New Hampshire's surplus funds system. Once a municipality sells a tax-deeded property and generates surplus, it deposits the excess funds with the superior court rather than holding them locally. The court then opens a case to determine the rightful recipient. In most situations, the former property owner is entitled to the surplus, but other parties with valid liens or claims on the property may also come forward. This court-supervised process provides a layer of protection for former owners, ensuring that surplus funds are distributed according to law rather than left in municipal accounts. If you believe surplus was generated from the sale of your former property, you may need to file a motion with the superior court to initiate or join the distribution proceeding.
Key Areas for Surplus Funds in New Hampshire
Hillsborough County is home to Manchester and Nashua, the two largest cities in New Hampshire. Higher property values and greater transaction volume in these cities mean that tax deedings here are more likely to produce meaningful surplus amounts. Both Manchester and Nashua maintain active tax collection offices that can provide information about recent tax deed sales and any surplus that was generated.
Rockingham County includes growing communities such as Salem and Derry, which sit along the southern border near Massachusetts. Population growth and rising property values in this corridor lead to a steady volume of tax deedings each year, and surplus funds can result when these properties sell above the debt owed.
Merrimack County contains Concord, the state capital. While smaller than Manchester or Nashua, Concord still sees regular tax deed activity. The Merrimack County Superior Court handles interpleader cases for surplus funds originating from municipalities within the county, making it a key courthouse to check for pending distributions.
How to Claim Surplus Funds in New Hampshire
Start by contacting the municipal tax collector in the city or town where your property was located. Ask whether the property was sold after the tax deed was taken and whether surplus funds were generated from the sale. If the municipality has already interpleaded the funds with the superior court under RSA 80:88, you will need to file a motion with that court to claim your share. Have your property address, parcel information, and proof of former ownership ready when you make contact. This article is for informational purposes only and is not legal advice.
Act Now to Recover Your New Hampshire Surplus Funds
Surplus funds from New Hampshire tax deedings can sit with the superior court for extended periods, but they will not be returned to you automatically. Whether the funds are still held by a municipality or have already been deposited with the court, the former owner needs to initiate the claim. Contact the relevant municipality or court for the current process.
Use our New Hampshire surplus funds directory to browse available records and start your search. Whether your property was in Manchester, Nashua, Concord, or a smaller town, the first step is confirming that surplus funds exist from your tax deed sale.