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Government Surplus Auction Guide

Government Surplus Auction Guide

Government Surplus Auction Guide

Hey there! We heard that you want to know how a typical government auction works, and we would love to help you understand everything from beginning to end.Here’s a behind the scenes look at the government surplus auctions scene from our comprehensive experiences in the field as well as from an online government auctions websites perspective. 

There are two main categories of federal government auctions:

A) Seized Property Auctions:

This includes government seized car auctions, other seized auctions, seized auto auction, etc.

B) Surplus Property Auctions:

 This includes original property of the military surplus auction, state auctions like Wisconsin surplus auction, and other military surplus auctions.

Seized Property Auctions:

A) come about via

i. Criminal Seizures

Example: Drug trafficker’s home is raided, and his possessions are confiscated because they were purchased with money made from illegal activities.

ii. Tax Seizures

Example: IRS finds individual did not pay the required tax, and seizes the person’s possessions, (like cars, jewelry, and real estate) and sells them with the intent to sell them to satisfy outstanding tax liability. Sometimes these are even sold via online tax lien auctions!

iii. Customs Seizures

Example:  from companies that tried to smuggle merchandise into the country without paying import duties or declaring merchandise properly, or even from people that failed to declare their merchandise properly when returning from a foreign vacation.

All of the above is included as well as any other ill-gotten gains.

Example: Police seizures of stolen property, not claimed by rightful owner within the allotted time, so the property goes into a police seized auction.

Examplelocal sheriff’s sales of foreclosed real estate and other court ordered assets go into federal government auctions that specialize in government property auctions.

Surplus Property Auctions:

These are essentially US government auctions for goods or property that a particular government agency no longer needs or that have been become obsolete by government standards. This category includes state surplus auction sales as well.

Example: a particular state decides to sell its automobiles or other equipment which it no longer has any use for, and it decides to upgrade by selling its unwanted assets in a gov surplus auction.

Example: A state university sells furniture, sports equipment, scientific equipment, or medical supplies to make way for new ones by selling off their holdings in gov surplus auctions.

Example: the US military decides to sell its surplus equipment through a military surplus auction. In the case of the US army, any American military goods that have been classified as surplus are ones that fit the following criteria:

  • Surplus military goods may be becoming too old or obsolete for our military’s current use – like tents, sleeping bags, and clothing, all of which go through some wear and tear over time, and it is only a matter of time before the military deems the items unfit for official use.
  • Military technology advances have created a need to upgrade to current state of the art equipment that is better than the enemy’s equipment. That is to say, when you take a look at any of these items sold in public surplus auctions, you can see on the market that there have been new and upgraded versions created with modified technology that is a better fit for today’s military requirements. Instruments used in the field from the 1980s are very different from the ones the military uses today. They could be made from different materials, might be designed differently, and today are able to withstand colder and hotter temperatures. With all of the above in mind, we can understand the reasoning behind why military surplus goods items are such bargains online. The underlying reason for these amazing deals that you can find at any US government auction is that the military needs to keep our armed forces equipped, armed, and supplied with the most cutting edge military technology that is available today.

Now we understand the structure of the typical government liquidation auction.

Let’s discuss how it all works on your end.

In all these circumstances, the government agency involved (either directly, through online government auctions on government auction sites, or through a third party auctioneer) typically puts up the property at a public oral auction, and the general public is able to attend and bid on the seized or surplus items or property, and the goods go to the highest bidder.

While this works differently for various auctions the larger ones typically make a special list available for the public two to three weeks before the auction. This is a list of items is created by the government agency that will be conducting the sale or auction, and is put out in order to help bidders decide what they want to buy and how much they would like to spend.

There will usually be a one or two-day period several days before the auction during which one must register for the auction, and during which time one can (and should) inspect the merchandise that will be offered up for bid on the auction day.

When you register for the auction, you will typically get a large bidder number and an auction catalog that will list the items up for sale next to their ID numbers. Then, when you walk around the inspection area and physically look at and inspect the goods that will be up for bid, you will notice that they are marked with their ID numbers which you can then look up in the auction catalog.

Sometimes, however, inspection of a particular lot may be in another location altogether, (like some government customs auctions).

Several days later, at the time of the actual auction, the auctioneer will call out the ID number of the item being auctioned off (one-by one), and will give a short description of the item. At that time, the auctioneer will begin soliciting bids. This process will go on until the item is sold to the highest bidder, and then bidding begins on the next item.

For most merchandise or property, full payment will have to be made that day (or within several days) via cash or cashier’s check, and you will have to remove it from the promises yourself.

In the case of real estate or other very expensive items, there is usually a 10 to 20% deposit that will be required on the day of the auction, and you may have from several weeks to a month to pay the balance.

We hope that this guide has educated you on the various types of government surplus auctions, and how to take advantage of the great deals being offered, even if it your first time at the auction house! For any further information, and to view government surplus auctions near you,  simply click here to subscribe to for your FREE 3 day trial.


US Treasury Auctions: How the Treasury Department Confiscates and Auctions Off Seized Goods

US Treasury AuctionsIf you’ve been following along in our blog series, you’re starting to see why the government is such a great source for seized and surplus assets. It has numerous agencies, some of which have been empowered to seize or confiscate an individual’s property for breaking the law, and others that spend billions of dollars on assets, which they themselves use and must eventually dispose of. The agency that we will be discussing here today falls into the first category, and it is notorious for seizing people’s assets for failure to do one simple thing, and that’s pay their taxes. Let’s start by talking about the broader U.S. Department of the Treasury, which includes the IRS.

What is the U.S. Department of the Treasury?

The Department of the Treasury was established in 1789 to manage government revenue. The Treasury prints and mints all paper currency and coins in circulation. It also collects all federal taxes through the Internal Revenue Service, and manages the government’s debt.

Where does the Department of the Treasury get stuff it auctions off?

There’s a reason why accountants frequently dispense the advice “Don’t mess with the IRS.” The first major source of assets for the treasury department is the IRS, which has the power to seize anything a person owns of value for failing to pay their taxes. This includes houses, jewelry, cars, boats, planes, and businesses. Not only can the IRS take your property, but you can also face fines and imprisonment for failing to pay or fraudulently reporting on your taxes. Despite this, countless people fail to pay their taxes every year and the IRS is able to seize millions of dollars in assets.

The second major source of assets for the Treasury Department is from people who violate federal laws such as counterfeiting. Property acquired with these illegal funds is also confiscated and auctioned off to the public.

How are Treasury Auctions Conducted?

Treasury auctions are somewhat different from other auctions we have discussed in that some of them are conducted through a sealed-bid auction rather than a public auction. In this type of auction all bidders simultaneously submit sealed bids to the auctioneer, so that no bidder knows how much the other auction participants have bid. The highest bidder is declared the winner. In a public auction bidders verbally call out their bids, and the auction ends when no one is willing to pay more than the highest bid.

What you need to know?

  • Each year approximately 300 auctions are conducted throughout the United States and Puerto Rico to sell seized/forfeited property.
  • There is a 180-day redemption period for seized assets, during which the tax offender can pay their taxes and have the property returned to them. Thus, if you are the winner of the auction, you will have to wait 180 days before the property will be transferred over to you. Furthermore, the owner, his heirs, or any person that has an interest in the property (such as a lien-holder) can come forward and pay the taxes, penalty, and interest owed.
  • While you are waiting out the 180-day redemption period you will receive an interest of 20% annually on your money, so even if they tax offender pays up, it’s a WIN for you.
  • The IRS only accepts Cash or Certified funds at their auctions. You can bring a combination of both since you do not know what the final price will be. For example if you think a car will sell for around $7,000, you can bring a certified check for $5,000 and and $2,500 in cash, just in case.

Start looking for Seized stuff from the United States Department of the Treasury by activating your free trial account right now!

DOD Auctions: How the US Department of Defense Gets Rid of its Surplus

Humvee In part III of our six-part series discussing various types of government agencies that hold auctions, we talked about the General Services Administration (G.S.A), which auctions off billions of dollars of surplus assets for countless government agencies every year. However, one of the agencies that the G.S.A does not deal with is the Department of Defense, which instead contracts with outside companies to auction off its assets. The Department of Defense or DOD is a great source of assets and deals. The Department of Defense doesn’t just auction off combat gear and military vehicles, either. On the contrary, it the department also auctions off tons of other stuff like medical supplies, computer and office supplies, gym equipment, and a slew of other things. Keep reading to learn more!  


What is the Department of Defense (DOD)?

The Department of Defense is a part of the executive branch of the federal government charged with coordinating and supervising all agencies concerned with our national security. It also happens to be the largest employer in the world. In total, the DOD has over 3.2 million people working for its various agencies. It takes a tremendous amount of money and resources to run a department of that size. For 2014, Congress allocated over $526 billion for the DOD to carry out its mandate. Every year the DOD auctions off hundreds of millions of dollars of assets that it no longer needs, some of which can be had for extraordinarily low prices.

Where does the Department of Defense get stuff it auctions off?

As we mentioned above, the Department of Defense spends more money than some countries do. It has a lot of stuff, and not just military vehicles and gear, either. As our military grows ever more sophisticated, a large percentage of money is spent on offices and intelligence equipment and offices. Thus, you can find some great deals on computers, printers, office furniture, and more. Additionally, the DOD is an excellent source of scrap metal, plumbing supplies, medical supplies (x-ray machines, hospital furniture, instruments,etc), travel trailers, and more.

What you need to know?

  • Many of the auctions for the Department of Defense have a buyer’s premium attached to them. This means you will have to pay an additional amount (around 10% of the purchase price) to the auctioneer, in order to cover the expenses that they incur in running the auction. Remember to take the buyer’s premium into account when coming up with a maximum bid for yourself.
  • Almost all auctions for the DOD now take place online. However, the auctioneer will not ship the items in most cases so you will either need to find a reliable shipping and packaging service to handle this for you, or pick the items up yourself.
  • As a general rule, credit cards are now accepted as payment for items that are won, although an amount in excess of $10,000 has to be paid with certified funds (e.g. certified bank check).

Start looking for surplus stuff from the United States Department of Defense by activating your free trial account right now!