Property Tax Refunds
Minnesota has two property tax refund programs available to owners of homesteaded property. As a homeowner you may be eligible for one or both of the following refunds if you owned and lived in your home on January 2nd of the current year:
- The regular property tax refund, sometimes called the "circuit breaker" is based on your household income and the amount of property tax you pay on your principal place of residence.
- The special or "targeting" property tax refund requires your net property tax to have increased by at least 12% and $100. The special property tax refund is not based on income.
You may be eligible for one or both, depending on your income and the size of your property tax bill. For more information or to determine if you are eligible for either of these refunds, read and fill out Form M1PR.
In order to complete Form M1PR, homeowners and mobile home owners will need information from their 2010 Statement of Property Taxes Payable, which you should receive by April 30th (or by mid July 2010, if you are a mobile home owner). It is not the Notice of Proposed Taxes (TNT) that you received in November 2009.
Due to a change in the filing requirements by the State of Minnesota you are no longer required to include your Statement of Property Taxes Payable when you mail your paper return. Your property tax information will be provided by the county.
You will need to list your 12-digit property identification number and county name. Your property identification number is located on the front of the tax statement or can be searched online at Property Look Up using your property address.
Only homestead property qualifies for the property tax refund. Your property tax statement will say if your property is classified as “homestead.” If it does not, or if you bought your home in 2009 you must apply for homestead status with your county assessor's office. You have until December 15, 2010 to apply. Get a signed statement saying that your application has been approved and include it with your Form M1PR.
Homesteaded Property / Homestead Status
- Your homestead is your primary, legal residence
- A person can have only one homestead
- Homestead property is taxed at a lower rate than non-homestead property
Do you owe delinquent property taxes on your home?
If you do, they must be paid before you can apply for your refund. If you pay the taxes (or make arrangements to pay them) by August 15, 2011, you will still be able to apply. You will need to get a receipt or a signed confession of judgment statement from your county auditor's or treasurer's office and include it with your Form M1PR.
Relative Homestead
“Relative homestead” is a property tax classification that allows the homeowner to retain homestead status on his or her property if a relative occupies it. However, relative homestead property does not qualify for the property tax refund, nor does it qualify for the special refund.
Life Estate
Elderly homeowners may transfer their property to a relative or friend but continue to occupy the property under a life estate. The occupants continue to retain an ownership interest in the home and will qualify for the property tax refund, provided they meet the regular qualifications, regardless who pays the property taxes.
For more information, go to the State of MN Homeowners Refund Information.
Special Relief Programs
The State of Minnesota also administers the Senior Citizens Property Tax Deferral program. This program allows people 65 or older to defer a portion of their homestead property taxes. The deferral begins with real estate taxes payable the year after you make the initial application. To be eligible, you must:
- be at least 65 years old,
- own and occupy the property as a homestead,
- have a household income of $60,000 or less, and
- have lived in your home for at least 15 years.
If you qualify your taxes cannot exceed 3% of your net income. The State of Minnesota will pay any remaining tax as a low interest loan. This is not a tax forgiveness program - the unpaid tax along with accumulated interest will become a lien on the property. This lien must be satisfied upon sale of the property.
Participants who apply for property tax refunds or rebates will not receive the refunds or rebates as cash payments. Instead, the refunds or rebates will be applied to the deferred property tax total. Form CR-SCD and instructions are available from the State of Minnesota.
Important facts to know about the program:
- This is a loan from the state to you
- Interest will be charged on the loan
- A lien will attach to the property
- The tax and loan information becomes public data
- The amount of property tax you pay is based on your income the year before you enter the program
