Certificate of Real Estate Value (CRV)
September 2006
In Minnesota, when recording a document that transfers property with a purchase price over $1,000, a certificate of real estate value (CRV) also known as Form PE-20 is required to be filed with the county auditor in the county where the property is located. A supplemental schedule, Form PE-20A, must also be submitted for agricultural, apartment, or commercial-industrial sale property. This responsibility is carried out by the seller, buyer, or an authorized legal agent so that true, correct, and complete information regarding the sale is provided. If a certificate of real estate value is not filed, the deed or instrument of conveyance that transfers title cannot be recorded. Additionally, a property cannot be granted the homestead classification by the assessor without it being filed.
Do the CRV and the supplemental schedule have a required format or design?
Yes, the format of the certificate of real estate value and the supplemental schedule is prescribed by the Department of Revenue. They are both printed on carbon paper forms with the CRV having four copies and the supplemental schedule having three copies. Each document includes facts and information that is deemed necessary for purposes of tax administration. These forms are the result of input from assessors, auditors, appraisers, and people in the real estate industry. They have been in use for many years with the latest revisions made in 1995.
What information must be furnished on the CRV and supplemental schedule?
The certificate of real estate value requires the preparer to provide: both buyer and seller identification and contact information, property identification information, details on the financial arrangement of the transaction, a description of the acquisition type, a description of the property transferred, an indication of the property’s planned use, and an explanation of financing if either a contract-for-deed or an assumed mortgage is used as the means to buy the property. The preparer of the supplemental schedule must also answer a series of ordinary questions that have been devised to facilitate the sales verification process for only farm, apartment, or commercial-industrial property. Furthermore, the county auditor furnishes the county code, parcel number, document transfer type, and an internal tracking number for county and state uses. The assessor presents assessment information and specific codes regarding the use of the sale for sales ratio study purposes, too.
Who can view the information on the CRV and the supplemental schedule?
The county auditor receives these forms when they are submitted with a transfer document. They are processed with one copy of the CRV sent to the Income Tax Division of the Department of Revenue and the other three copies of the CRV and supplemental schedule forwarded to the assessor for further review and completion. Once the assessor’s work is finished, one copy is passes on to the Property Tax Division of the Department of Revenue, the second copy is mailed to the governing body of each township or city where the property is located, and the third copy is kept on file in the assessor’s office for reference. Since the forms processed by the assessor are considered public data, any person who has a desire to review them may do so.
Is the information on the CRV and the supplemental schedule verified and validated by its users?
Some individuals who use these forms may contact the seller, buyer, or agent who prepared them to verify the information filed. Specifically, representatives from the Department of Revenue and some real estate professionals (i.e. appraisers, assessors, and realtors) might validate information on a sale property to determine if it sold under conditions that meet the definition of market value. Since appraisals completed for property tax purposes are based on sales data, the assessor will regularly complete a sales verification on a recently sold property in order to provide credibility and ensure accuracy in the assessment process.
How is the information on the CRV and the supplemental schedule used?
The information reported on these forms is used in a variety of ways. It is the county auditor’s responsibility to verify that they are completed with the required information and that the deed tax submitted is correct based on the reported sale price of the property. The assessor uses the sale data to develop an understanding of the marketplace and to improve the quality of assessments. This information is carefully analyzed to determine if the sale meets the acceptance criteria established for sales ratio study purposes or if the purchase price should be further adjusted to reflect the price paid for real estate. The Department of Revenue collects this information for use in the development of specialized studies and reports. One of the major studies is the sales ratio used to measure the quality of assessments and to equalize market values throughout the state. It is also used for school aids and tax court matters. Some of the other analyses undertaken are in the areas of planning, housing and finance, and agriculture. Appraisers and realtors use this information to support their work processes when rendering an opinion of value or listing a property. Local government officials and the general public occasionally use this data to develop an awareness of what property is selling for. They also use it to verify that property assessments are fair and equitable.
Where can someone obtain a CRV and supplemental schedule for completion?
Each county auditor has a supply of certificates for the general public to use. Most real estate offices, closing companies, and law firms have these forms, too. They purchase their certificates from the State of Minnesota Bookstore and routinely complete them for their clients in preparation for real estate closings and to fulfill the requirements to record property transfer documents. Eventually, an electronic (eCRV) alternative to the paper forms will be available for use on a statewide basis during the spring of 2008. These documents are in the process of being established by the Property Tax Division of the Minnesota Department of Revenue and are being deployed by test counties and selected industry CRV submitters in the spring of 2007.