HF 1491

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to taxation; property; indexing the residential homestead and agricultural
market value credits; amending Minnesota Statutes 2006, section 273.1384,
subdivisions 1, 2, by adding subdivisions.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2006, section 273.1384, subdivision 1, is amended to
read:

Subdivision 1.

Residential homestead market value credit.

Each county auditor
shall determine a homestead credit for each class 1a, 1b, and 2a homestead property
within the county equal to 0.4 percent of the deleted text begin first $76,000 of deleted text end market value of the property new text begin
up to the residential homestead market value credit valuation limit under subdivision 1a new text end
minus .09 percent of the market value in excess of deleted text begin $76,000 deleted text end new text begin the residential homestead
market value credit valuation limit under subdivision 1a new text end . The credit amount may not
be less than zero. In the case of an agricultural or resort homestead, only the market
value of the house, garage, and immediately surrounding one acre of land is eligible in
determining the property's homestead credit. In the case of a property that is classified as
part homestead and part nonhomestead, (i) the credit shall apply only to the homestead
portion of the property, but (ii) if a portion of a property is classified as nonhomestead
solely because not all the owners occupy the property, not all the owners have qualifying
relatives occupying the property, or solely because not all the spouses of owners occupy
the property, the credit amount shall be initially computed as if that nonhomestead portion
were also in the homestead class and then prorated to the owner-occupant's percentage
of ownership. For the purpose of this section, when an owner-occupant's spouse does
not occupy the property, the percentage of ownership for the owner-occupant spouse is
one-half of the couple's ownership percentage.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes payable in 2008 and
thereafter.
new text end

Sec. 2.

Minnesota Statutes 2006, section 273.1384, is amended by adding a subdivision
to read:

new text begin Subd. 1a. new text end

new text begin Residential homestead market value credit valuation limit. new text end

new text begin (a)
Beginning with assessment year 2007, the commissioner of revenue must annually certify
the residential homestead market value credit valuation limit as the product of: (1) the
ratio of the statewide average taxable market value of a residential homestead in the
preceding assessment year to the statewide average taxable market value of a residential
homestead for assessment year 2005; and (2) $76,000. The limit must be rounded to
the nearest $1,000.
new text end

new text begin (b) The commissioner must certify the limit by January 2 of each assessment year,
except that for assessment year 2007, the commissioner must certify the limit by June
1, 2007.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes payable in 2008 and
thereafter.
new text end

Sec. 3.

Minnesota Statutes 2006, section 273.1384, subdivision 2, is amended to read:

Subd. 2.

Agricultural homestead market value credit.

Property classified as class
2a agricultural homestead is eligible for an agricultural credit. The credit is computed
using the property's agricultural credit market value, defined for this purpose as the
property's class 2a market value excluding the market value of the house, garage, and
immediately surrounding one acre of land. The credit is equal to 0.3 percent of the deleted text begin first
$115,000 of the deleted text end property's agricultural credit market value new text begin up to the agricultural credit
market value limit under subdivision 2a, new text end minus .05 percent of the property's agricultural
credit market value in excess of deleted text begin $115,000 deleted text end new text begin the agricultural credit market value limit under
subdivision 2a new text end , subject to a maximum reduction of $115. In the case of property that is
classified in part as class 2a agricultural homestead and in part as class 2b nonhomestead
farm land solely because not all the owners occupy or farm the property, not all the owners
have qualifying relatives occupying or farming the property, or solely because not all the
spouses of owners occupy the property, the credit must be initially computed as if that
nonhomestead agricultural land was also classified as class 2a agricultural homestead and
then prorated to the owner-occupant's percentage of ownership.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes payable in 2008 and
thereafter.
new text end

Sec. 4.

Minnesota Statutes 2006, section 273.1384, is amended by adding a subdivision
to read:

new text begin Subd. 2a. new text end

new text begin Agricultural credit market value limit. new text end

new text begin (a) Beginning with assessment
year 2007, the commissioner of revenue must annually certify the agricultural credit
market value limit as the product of (1) $115,000, and (2) the ratio of the statewide
average taxable market value of agricultural property per acre of deeded farm land in the
preceding assessment year to the statewide average taxable market value of agricultural
property per acre of deeded farm land for assessment year 2005. The limit must be
rounded to the nearest $5,000.
new text end

new text begin (b) For the purposes of this subdivision, "agricultural property" means all class 2
property under section , subdivision 23, except for (1) timberland, (2) a landing
area or public access area of a privately owned public use airport, and (3) property
consisting of the house, garage, and immediately surrounding one acre of land of an
agricultural homestead.
new text end

new text begin (c) The commissioner must certify the limit by January 2 of each assessment year,
except that for assessment year 2007 the commissioner must certify the limit by June
1, 2007.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes payable in 2008 and
thereafter.
new text end