What Happens If You Don’t Pay Property Taxes in Arkansas?

If you don’t pay property taxes in Arkansas, a 10% penalty hits your balance the day after October 15, your county collector holds the delinquent property for about a year, and by July 1 of the following year it is turned over to the Arkansas Commissioner of State Lands. The state then sends notices, schedules an auction, and sells the property if you don’t redeem it first. You can pay off the debt and reclaim the property any time before the auction, but the costs grow the longer you wait.

The Day After October 15

Arkansas property taxes are due at the county collector’s office between the first business day in March and October 15. If October 15 lands on a weekend or postal holiday, the deadline shifts to the next business day.¹ Anything still unpaid after that date is delinquent, and a 10% penalty is added to the outstanding balance right away.

Before the deadline, you can split a current-year bill into installments: a quarter by the third Monday in April, another quarter by the third Monday in July, and the remaining half by October 15. Some counties also accept payments in any amount between March and the deadline.² No penalty attaches as long as the full amount is paid by October 15. Once you cross into delinquency, that flexibility disappears.

One quirk catches people off guard. If you owe delinquent personal property taxes, the county collector cannot accept payment on delinquent real property taxes until the personal property balance is paid in full.²

Year One: The County Holds the Property

The county collector holds delinquent property for one year after the delinquency date. If the taxes are still unpaid, the collector certifies the property to the Arkansas Commissioner of State Lands by July 1 of the following year.³ Certification transfers oversight from the county to the state and includes a record of all taxes, penalties, interest, and costs owed, along with your last known address.

Here is how that works on a real calendar. Taxes for 2025 are due by October 15, 2025. If unpaid, they become delinquent October 16, 2025, with the 10% penalty. The county holds the property through 2026. By July 1, 2027, the collector certifies it to the Commissioner of State Lands. From that point forward, you are dealing with the state, not the county.

This year-plus window at the county level is the easiest time to resolve the debt. Some counties are more flexible than the state about timing, and the balance is smaller than it will ever be again.

Notices You Should Receive

Once the Commissioner of State Lands receives your tax-delinquent property, the office must notify you by certified mail at the last known address on file with the county. The notice spells out your right to redeem the property by paying all taxes, penalties, interest, and costs, including the cost of sending that notice.⁴

A second round of notice goes out when a sale is scheduled. For in-person auctions, owners and interested parties receive notice by regular mail at least 30 days before the sale. For online auctions and negotiated sales, the Commissioner sends notice by certified mail once the first bid comes in.⁵ The Commissioner also publishes a sale notice in a newspaper with general circulation in the county where the property is located.⁶

If certified mail comes back unclaimed, the state cannot simply proceed with a sale. The U.S. Supreme Court held in Jones v. Flowers that when mailed notice is returned undelivered, the government must take additional reasonable steps to reach the owner before selling the property.⁷ Knowing that your mail returned unclaimed and doing nothing violates due process. If the state sold your property without adequate follow-up, that failure can be the basis of a legal challenge.

Make sure the county has your current mailing address. If you’ve moved, update it with the assessor and collector. Mail that never reaches you still counts as proper notice if the state wasn’t on notice that it failed.

Redeeming Before the Auction

Arkansas does not set a fixed redemption deadline that expires on a particular date after certification. You can redeem at any point before the property is sold, up to 4:00 p.m. Central Time on the last business day before the scheduled sale.⁸ Once the auction hammer falls, the opportunity is gone.

To redeem, you submit a petition and payment to the Commissioner of State Lands for the full amount of outstanding taxes, penalties, interest, fees, and costs as of the date the office receives your petition.⁸ The 10% penalty from the initial delinquency is part of that total, interest continues to accrue, and administrative costs for certified mail notices and newspaper publication get folded in. The longer you wait, the more expensive redemption becomes.

Don’t count on negotiating. The Commissioner’s office requires the full amount, and there is no statutory provision for state-level installment payments on delinquent taxes.

The Auction and What Happens to Any Extra Money

If you don’t redeem, the Commissioner sells the property through a live public auction or an online auction. The minimum bid equals the total of delinquent taxes, penalties, interest, and sale costs; competitive bidding can drive the final price higher.⁹ Properties that don’t sell at the live auction move to an online post-auction sale 30 days later. If a property is still unsold after two years, the Commissioner can negotiate a sale price based on what’s in the best interest of the state and local taxing units.⁵

If the property sells for more than you owed, the excess doesn’t belong to the state. The Commissioner of State Lands holds surplus proceeds in escrow for one year after the sale, and the former owner of record at the time of sale can apply to claim them. For properties sold after July 1, 2018, the funds stay available for two years. If no one claims them in that window, the money is returned to the county.¹⁰

This process follows the U.S. Supreme Court’s ruling in Tyler v. Hennepin County, which held that a government can sell property to recover unpaid taxes but cannot keep value beyond what was owed. Retaining the surplus is an unconstitutional taking.¹¹ If you lost property to a tax sale and think it brought more than your tax debt, check the Commissioner’s website for a list of parcels with available excess proceeds. The office does not actively track down former owners for this purpose, and the claim window is short.

If You Can’t Pay

Arkansas offers two programs that can lower your tax bill and help you avoid getting into this situation again.

Homestead Tax Credit

Any Arkansas homeowner can receive a credit that reduces property tax on a primary residence. Beginning with 2026 tax bills, the credit increases to up to $600 per year.¹² You claim it by registering with your county assessor’s office, and only one property per year qualifies. The home must qualify as your homestead before January 1 of the year after assessment.¹³

Assessment Freeze at 65 or on Disability

Homeowners who qualify for the homestead credit and are either 65 or older or disabled can have the property’s taxable assessed value frozen. The freeze locks the assessed value at the level set on the next assessment date after you turn 65 or become disabled. If you buy a new home after reaching 65 or becoming disabled, the freeze applies at the next assessment date after purchase.¹² The freeze does not transfer to a new buyer if you sell, and substantial improvements that add 25% or more to the home’s value can raise the frozen assessment. You apply through the county assessor.

Active-Duty Military

If you owned the property before entering active-duty military service, the Servicemembers Civil Relief Act caps interest on pre-service debts at 6% per year. The cap covers all types of pre-service obligations, including property tax debts, and reaches additional charges and fees beyond interest. To invoke it, send the creditor written notice and a copy of your military orders no later than 180 days after your service ends. Once received, the creditor must forgive interest above 6% retroactively to the date your active-duty orders were issued and refund any excess interest already paid.¹⁴

Bankruptcy as a Pause Button

Filing bankruptcy triggers an automatic stay under federal law that halts most collection actions against you and your property, including actions to seize or sell property of the bankruptcy estate and efforts to enforce liens against it.¹⁵ A pending tax sale generally falls within that stay. Chapter 13 is usually the better fit, because it lets you propose a repayment plan for tax arrears over up to five years. A Chapter 7 filing also triggers the stay but involves liquidation rather than repayment, so it won’t necessarily solve the tax debt. If the case is dismissed or the court lifts the stay, the tax sale picks up where it left off. Filing solely to delay a sale without a realistic plan to pay can draw sanctions or dismissal with prejudice.

1
Justia. Arkansas Code 26-36-201 – Dates Taxes Due and Payable
2
Justia. Arkansas Code 26-35-501 – Time to Pay – Installments
3
Justia. Arkansas Code 26-37-101 – Transfer of Tax-Delinquent Lands
4
Justia. Arkansas Code 26-37-301 – Notice to Owner – Definitions
5
FindLaw. Arkansas Code 26-37-202 – Procedure to Sell
6
Legal Information Institute. Arkansas Code R. 135.00.19 – Commissioner of State Lands Rules
7
Library of Congress. Jones v. Flowers, 547 U.S. 220 (2006)
8
Code of Arkansas Rules. 26 CAR 400-108 – Redemption of Tax-Delinquent Parcels
9
Arkansas Commissioner of State Lands. Purchasing Tax-Delinquent Property
10
Arkansas Commissioner of State Lands. Available Excess Proceeds
11
Supreme Court of the United States. Tyler v. Hennepin County, 598 U.S. 631 (2023)
12
Arkansas Department of Finance and Administration. Property Tax Relief
13
Justia. Arkansas Code 26-26-1118 – Homestead Property Tax Credit
14
U.S. Department of Justice. Your Rights as a Servicemember – 6% Interest Rate Cap for Servicemembers on Pre-Service Debts
15
Office of the Law Revision Counsel. 11 USC 362 – Automatic Stay