HF 2277

as introduced - 88th Legislature (2013 - 2014) Posted on 03/12/2014 01:58pm

A bill for an act
relating to taxation; making policy changes to property taxes and other
miscellaneous taxes and tax provisions; amending Minnesota Statutes 2012,
sections 270C.56, subdivision 3; 274.01, subdivision 1; 274.014, subdivision 3;
289A.18, subdivision 2; Minnesota Statutes 2013 Supplement, section 273.1325,
subdivision 1.

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

ARTICLE 1

PROPERTY TAXES

Section 1.

Minnesota Statutes 2013 Supplement, section 273.1325, subdivision 1,
is amended to read:

Subdivision 1.

Computation.

The Department of Revenue must annually conduct
an assessment/sales ratio study of the taxable property in each county, city, town, and
school district in accordance with the procedures in subdivisions 2 and 3. Based upon the
results of this assessment/sales ratio study, the Department of Revenue must determine
an equalized net tax capacity for the various classes of taxable property in each taxing
district, the aggregate of which is designated as the adjusted net tax capacity. The adjusted
net tax capacity must be reduced by the captured tax capacity of tax increment districts
under section 469.177, subdivision 2, fiscal disparities contribution tax capacities under
sections 276A.06 and 473F.08, and the tax capacity of transmission lines required to be
subtracted from the local tax base under section 273.425; and increased by fiscal disparities
distribution tax capacities under sections 276A.06 and 473F.08. The adjusted net tax
capacities shall be determined using the net tax capacity percentages in effect for the
assessment year following the assessment year of the study. The Department of Revenue
must make whatever estimates are necessary to account for changes in the classification
system. The Department of Revenue may incur the expense necessary to make the
determinations. The commissioner of revenue may reimburse any county or governmental
official for requested services performed in ascertaining the adjusted net tax capacity. On
or before March 15 annually, the Department of Revenue shall file with the chair of the
Tax Committee of the house of representatives and the chair of the Committee on Taxes
and Tax laws of the senate a report of adjusted net tax capacities for school districts.
On or before June deleted text begin 15 deleted text end new text begin 30 new text end annually, the Department of Revenue shall file its final report
on the adjusted net tax capacities for school districts established by the previous year's
assessments and the current year's net tax capacity percentages with the commissioner of
education and each county auditor for those school districts for which the auditor has the
responsibility for determination of local tax rates. A copy of the report so filed shall be
mailed to the clerk of each school district involved and to the county assessor or supervisor
of assessments of the county or counties in which each school district is located.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2014.
new text end

Sec. 2.

Minnesota Statutes 2012, section 274.01, subdivision 1, is amended to read:

Subdivision 1.

Ordinary board; meetings, deadlines, grievances.

(a) The town
board of a town, or the council or other governing body of a city, is the board of appeal
and equalization except (1) in cities whose charters provide for a board of equalization or
(2) in any city or town that has transferred its local board of review power and duties to
the county board as provided in subdivision 3. The county assessor shall fix a day and
time when the board or the board of equalization shall meet in the assessment districts
of the county. Notwithstanding any law or city charter to the contrary, a city board of
equalization shall be referred to as a board of appeal and equalization. On or before
February 15 of each year the assessor shall give written notice of the time to the city or
town clerk. Notwithstanding the provisions of any charter to the contrary, the meetings
must be held between April 1 and May 31 each year. The clerk shall give published and
posted notice of the meeting at least ten days before the date of the meeting.

The board deleted text begin shall deleted text end new text begin may new text end meet new text begin either at a central location within the county or new text end at the
office of the clerk to review the assessment and classification of property in the town or
city. No changes in valuation or classification which are intended to correct errors in
judgment by the county assessor may be made by the county assessor after the board has
adjourned in those cities or towns that hold a local board of review; however, corrections
of errors that are merely clerical in nature or changes that extend homestead treatment to
property are permitted after adjournment until the tax extension date for that assessment
year. The changes must be fully documented and maintained in the assessor's office and
must be available for review by any person. A copy of the changes made during this
period in those cities or towns that hold a local board of review must be sent to the county
board no later than December 31 of the assessment year.

(b) The board shall determine whether the taxable property in the town or city has
been properly placed on the list and properly valued by the assessor. If real or personal
property has been omitted, the board shall place it on the list with its market value, and
correct the assessment so that each tract or lot of real property, and each article, parcel,
or class of personal property, is entered on the assessment list at its market value. No
assessment of the property of any person may be raised unless the person has been
duly notified of the intent of the board to do so. On application of any person feeling
aggrieved, the board shall review the assessment or classification, or both, and correct
it as appears just. The board may not make an individual market value adjustment or
classification change that would benefit the property if the owner or other person having
control over the property has refused the assessor access to inspect the property and the
interior of any buildings or structures as provided in section 273.20. A board member
shall not participate in any actions of the board which result in market value adjustments
or classification changes to property owned by the board member, the spouse, parent,
stepparent, child, stepchild, grandparent, grandchild, brother, sister, uncle, aunt, nephew,
or niece of a board member, or property in which a board member has a financial interest.
The relationship may be by blood or marriage.

(c) A local board may reduce assessments upon petition of the taxpayer but the total
reductions must not reduce the aggregate assessment made by the county assessor by more
than one percent. If the total reductions would lower the aggregate assessments made by
the county assessor by more than one percent, none of the adjustments may be made. The
assessor shall correct any clerical errors or double assessments discovered by the board
without regard to the one percent limitation.

(d) A local board does not have authority to grant an exemption or to order property
removed from the tax rolls.

(e) A majority of the members may act at the meeting, and adjourn from day to day
until they finish hearing the cases presented. The assessor shall attend, with the assessment
books and papers, and take part in the proceedings, but must not vote. The county assessor,
or an assistant delegated by the county assessor shall attend the meetings. The board shall
list separately, on a form appended to the assessment book, all omitted property added
to the list by the board and all items of property increased or decreased, with the market
value of each item of property, added or changed by the board, placed opposite the item.
The county assessor shall enter all changes made by the board in the assessment book.

(f) Except as provided in subdivision 3, if a person fails to appear in person, by
counsel, or by written communication before the board after being duly notified of the
board's intent to raise the assessment of the property, or if a person feeling aggrieved by an
assessment or classification fails to apply for a review of the assessment or classification,
the person may not appear before the county board of appeal and equalization for a review
of the assessment or classification. This paragraph does not apply if an assessment was
made after the local board meeting, as provided in section 273.01, or if the person can
establish not having received notice of market value at least five days before the local
board meeting.

(g) The local board must complete its work and adjourn within 20 days from the
time of convening stated in the notice of the clerk, unless a longer period is approved by
the commissioner of revenue. No action taken after that date is valid. All complaints
about an assessment or classification made after the meeting of the board must be heard
and determined by the county board of equalization. A nonresident may, at any time,
before the meeting of the board file written objections to an assessment or classification
with the county assessor. The objections must be presented to the board at its meeting by
the county assessor for its consideration.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2012, section 274.014, subdivision 3, is amended to read:

Subd. 3.

Proof of compliance; transfer of duties.

(a) Any city or town that
conducts local boards of appeal and equalization meetings must provide proof to the
county assessor by deleted text begin December 1, 2006 deleted text end new text begin February 15, 2015 new text end , and each year thereafter, that it
is in compliance with the requirements of subdivision 2. Beginning in deleted text begin 2006 deleted text end new text begin 2015 new text end , this
notice must also verify that there was a quorum of voting members at each meeting of the
board of appeal and equalization in the current year. A city or town that does not comply
with these requirements is deemed to have transferred its board of appeal and equalization
powers to the county beginning with the following year's assessment and continuing
unless the powers are reinstated under paragraph (c).

(b) The county shall notify the taxpayers when the board of appeal and equalization
for a city or town has been transferred to the county under this subdivision and, prior to
the meeting time of the county board of equalization, the county shall make available to
those taxpayers a procedure for a review of the assessments, including, but not limited to,
open book meetings. This alternate review process shall take place in April and May.

(c) A local board whose powers are transferred to the county under this subdivision
may be reinstated by resolution of the governing body of the city or town and upon proof
of compliance with the requirements of subdivision 2. The resolution and proofs must be
provided to the county assessor by deleted text begin December 1 deleted text end new text begin February 15 new text end in order to be effective for
the following year's assessment.

(d) A local board whose powers are transferred to the county under this subdivision
may continue to employ a local assessor and is not deemed to have transferred its powers
to make assessments.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with local boards of appeal
and equalization meetings held after December 31, 2014.
new text end

ARTICLE 2

MISCELLANEOUS

Section 1.

Minnesota Statutes 2012, section 270C.56, subdivision 3, is amended to read:

Subd. 3.

Procedure for assessment; claims for refunds.

(a) The commissioner
may assess liability for the taxes described in subdivision 1 against a person liable
under this section. The assessment may be based upon information available to the
commissioner. It must be made within the prescribed period of limitations for assessing
the underlying tax, deleted text begin or deleted text end within one year after the date of an order assessing underlying
tax new text begin , or within one year after the date of a final administrative or judicial determination new text end ,
whichever period expires later. An order assessing personal liability under this section is
reviewable under section 270C.35 and is appealable to Tax Court.

(b) If the time for appealing the order has expired and a payment is made by or
collected from the person assessed on the order in excess of the amount lawfully due
from that person of any portion of the liability shown on the order, a claim for refund
may be made by that person within 120 days after any payment of the liability if the
payment is within 3-1/2 years after the date the order was issued. Claims for refund under
this paragraph are limited to the amount paid during the 120-day period. Any amounts
collected under paragraph (c) after a claim for refund is filed in order to satisfy the unpaid
balance of the assessment that is the subject of the claim shall be returned if the claim is
allowed. There is no claim for refund available under this paragraph if the assessment has
previously been the subject of an administrative or Tax Court appeal, or a denied claim
for refund. The taxpayer may contest denial of the refund as provided in the procedures
governing claims for refunds under section 289A.50, subdivision 7.

(c) If a person has been assessed under this section for an amount for a given period
and the time for appeal has expired, regardless of whether an action contesting denial of a
claim for refund has been filed under paragraph (b), or there has been a final determination
that the person is liable, collection action is not stayed pursuant to section 270C.33,
subdivision 5, for that assessment or for subsequent assessments of additional amounts for
the same person for the same period and tax type.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2012, section 289A.18, subdivision 2, is amended to read:

Subd. 2.

Withholding returns, entertainer withholding returns, returns for
withholding from payments to out-of-state contractors, and withholding returns
from partnerships and S corporations.

new text begin (a) new text end Withholding returns deleted text begin for the first, second,
deleted text end deleted text begin and third quarters deleted text end are due on or before the last day of the month following the close of
the quarterly period. However, if the return shows timely deposits in full payment of
the taxes due for that period, the returns deleted text begin for the first, second, and third quarters deleted text end may be
filed on or before the tenth day of the second calendar month following the period. deleted text begin The
return for the fourth quarter must be filed on or before the 28th day of the second calendar
month following the period. deleted text end An employer, in preparing a quarterly return, may take credit
for deposits previously made for that quarter. Entertainer withholding tax returns are
due within 30 days after each performance. Returns for withholding from payments to
out-of-state contractors are due within 30 days after the payment to the contractor. Returns
for withholding by partnerships are due on or before the due date specified for filing
partnership returns. Returns for withholding by S corporations are due on or before the
due date specified for filing corporate franchise tax returns.

new text begin (b) A seasonal employer who provides notice in the form and manner prescribed
by the commissioner before the end of the calendar quarter is not required to file a
withholding tax return for periods of anticipated inactivity unless the employer pays wages
during the period from which tax is withheld. For purposes of this paragraph, a seasonal
employer is an employer that regularly, in the same one or more quarterly periods of each
calendar year, pays no wages to employees.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin (a) The amendments in paragraph (a) are effective for returns
due after January 1, 2016.
new text end

new text begin (b) The amendment adding paragraph (b) is effective for wages paid after December
31, 2015.
new text end