Property Tax Refund Program
June 2003
The Minnesota Property Tax Refund Program is designed to minimize the burden of property taxation by providing relief to all qualifying applicants through an annual reimbursement. There are two property tax refunds linked with this program and the Department of Revenue offers both of them. The regular refund is intended for renters, mobile/manufactured homeowners, and homeowners. An additional refund only available to mobile/manufactured homeowners and homeowners is the special property tax refund. People who meet certain program requirements and file a timely application may be eligible for one or both of these refunds.
What is the regular property tax refund?
This repayment is based upon the total household income of the renter or homestead owner and the property taxes paid on their residence. If the amount of property taxes payable or rent constituting property taxes is greater than the specified percentage of income prescribed by law, the renter or owner is eligible for a refund. Conversely, the renter or owner is not eligible for a refund when the tax amount is equal to or less than the specified percentage of income.
What is the special property tax refund?
This reimbursement is for people who own and occupy their home as of January 2nd of both the current and preceding years. It is based entirely on the amount of tax increase experienced between these two years regardless of the applicant’s household income. If the current year’s payable property taxes increased by more than 12 percent and the taxes are at least $100 more than the previous year’s taxes, the owner is eligible for a refund. This targeted refund does not apply to tax increases attributable to new improvements, special assessments, or the expiration of a value exclusion under the program “This Old House”.
What requirements must be satisfied in order to qualify for a property tax refund?
One must fulfill several prerequisites to obtain a refund. First, the applicant has to be a renter, a mobile/manufactured homeowner, or a homeowner who has been either a full or part year resident of Minnesota during the past year. Second, the applicant cannot be a dependent of another taxpayer. Third, if one is a renter, this person must have lived in a building where the owner was assessed property taxes or made payments to a governmental unit in lieu of property taxes. If one is a mobile/manufactured homeowner or a homeowner, the property must be classified as a homestead and the owner must have paid taxes or made arrangements to pay any delinquent taxes. Fourth, if a property qualifies as homestead under the relative homestead law, neither the property owner nor the relative can claim a property tax refund. Last of all, there are certain income requirements established for the applicant seeking a regular property tax refund, while there are no income requirements set for the applicant seeking a special property tax refund.
What are the income requirements for a renter or homeowner seeking a regular property tax refund?
The total household income limits established for the regular property tax refund vary depending upon family size and whether or not the applicant is a renter or homeowner. As a renter with no dependents, the total household income limit is $44,019. This limit increases to $62,019 for a renter with five or more dependents. For senior citizen and disabled renters with five or more dependents, the income limit is $65,019. The total household income limit for a homeowner is $81,599. It increases to $99,599 for a homeowner with five or more dependents. Senior citizen and disabled homeowners with five or more dependents have an income limit of $102,599.
How much can an applicant get back from the property tax refund program?
The maximum refund that a renter can receive through the regular property tax refund program is $1,250. A homestead owner can receive a regular property tax refund up to a maximum amount of $1,530. The size of this refund depends upon the applicant’s total household income, number of dependents, and how much property tax is paid by the homestead owner or deemed paid in rent by the renter. With regards to the special property tax refund, the reimbursement to a homestead owner is 60 percent of the qualifying property tax increase up to a maximum amount of $1,000.
What is the deadline for filing a property tax refund claim?
The deadline for filing a refund is on or before August 15th of the year following the year in which the rent was paid by the renter and of the year in which the property taxes are due and payable for the homestead owner. A claim filed after this date can be submitted up to one year after this original deadline. No claim is allowed if it is filed more than one year after the original due date.
How does a renter or homestead owner apply for one or both of these tax refunds?
To apply, one must use Minnesota property tax refund form M1PR. This form and a set of instructions are provided in a booklet that can be obtained from some banks and libraries, many tax offices and accounting firms, and the county auditor-treasurer’s office. One can also get this information from the Department of Revenue by calling their 24-hour forms order service at 651.296.4444 or by accessing their website (www.taxes.state.mn.us).
When can one expect to receive a refund?
A qualifying applicant who is either a renter or a mobile/manufactured homeowner can expect to receive a refund check from the Department of Revenue after August 1st and prior to August 15th, or 60 days after the receipt of the application, whichever is later. A homeowner who qualifies for a refund can expect to receive it after September 15th and before September 30th, or 60 days after the application has been submitted for processing, whichever is later.