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HF 1343

as introduced - 93rd Legislature (2023 - 2024) Posted on 02/06/2023 11:00am

KEY: stricken = removed, old language.
underscored = added, new language.

Bill Text Versions

Engrossments
Introduction Posted on 02/03/2023

Current Version - as introduced

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A bill for an act
relating to taxation; property; modifying identification requirements for homestead
determination; amending Minnesota Statutes 2022, sections 270B.12, subdivisions
8, 9; 273.124, subdivisions 13, 13c, 13d, 14; 273.1245, subdivision 1; 273.1315,
subdivision 2; 290A.25.

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

Section 1.

Minnesota Statutes 2022, section 270B.12, subdivision 8, is amended to read:


Subd. 8.

County assessors; homestead classification and renter credit.

The
commissioner may disclose names and Social Security numbersnew text begin or names and individual
taxpayer identification numbers
new text end of individuals who have applied for both homestead
classification under section 273.13 and a property tax refund as a renter under chapter 290A
for the purpose of and to the extent necessary to administer section 290A.25.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for allowed disclosures made in 2023
and thereafter.
new text end

Sec. 2.

Minnesota Statutes 2022, section 270B.12, subdivision 9, is amended to read:


Subd. 9.

County assessors; homestead application, determination, and income tax
status.

(a) If, as a result of an audit, the commissioner determines that a person is a Minnesota
nonresident or part-year resident for income tax purposes, the commissioner may disclose
the person's name, address, and Social Security numbernew text begin or the person's name, address, and
individual taxpayer identification number
new text end to the assessor of any political subdivision in the
state, when there is reason to believe that the person may have claimed or received homestead
property tax benefits for a corresponding assessment year in regard to property apparently
located in the assessor's jurisdiction.

(b) To the extent permitted by section 273.124, subdivision 1, paragraph (a), the
Department of Revenue may verify to a county assessor whether an individual who is
requesting or receiving a homestead classification has filed a Minnesota income tax return
as a resident for the most recent taxable year for which the information is available.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for allowed disclosures made in 2023
and thereafter.
new text end

Sec. 3.

Minnesota Statutes 2022, section 273.124, subdivision 13, is amended to read:


Subd. 13.

Homestead application.

(a) A person who meets the homestead requirements
under subdivision 1 must file a homestead application with the county assessor to initially
obtain homestead classification.

(b) The commissioner shall prescribe the content, format, and manner of the homestead
application required to be filed under this chapter pursuant to section 270C.30. The
application must clearly inform the taxpayer that this application must be signed by all
owners who occupy the property or by the qualifying relative and returned to the county
assessor in order for the property to receive homestead treatment.

(c) Every property owner applying for homestead classification must furnish to the
county assessor the Social Security numbernew text begin or individual taxpayer identification numbernew text end of
each occupant who is listed as an owner of the property on the deed of record, the name
and address of each owner who does not occupy the property, and the name and Social
Security numbernew text begin or individual taxpayer identification numbernew text end of the spouse of each occupying
owner. The application must be signed by each owner who occupies the property and by
each owner's spouse who occupies the property, or, in the case of property that qualifies as
a homestead under subdivision 1, paragraph (c), by the qualifying relative.

If a property owner occupies a homestead, the property owner's spouse may not claim
another property as a homestead unless the property owner and the property owner's spouse
file with the assessor an affidavit or other proof required by the assessor stating that the
property qualifies as a homestead under subdivision 1, paragraph (e).

Owners or spouses occupying residences owned by their spouses and previously occupied
with the other spouse, either of whom fail to include the other spouse's name and Social
Security numbernew text begin or individual taxpayer identification numbernew text end on the homestead application
or provide the affidavits or other proof requested, will be deemed to have elected to receive
only partial homestead treatment of their residence. The remainder of the residence will be
classified as nonhomestead residential. When an owner or spouse's name and Social Security
numbernew text begin or individual taxpayer identification numbernew text end appear on homestead applications for
two separate residences and only one application is signed, the owner or spouse will be
deemed to have elected to homestead the residence for which the application was signed.

(d) If residential real estate is occupied and used for purposes of a homestead by a relative
of the owner and qualifies for a homestead under subdivision 1, paragraph (c), in order for
the property to receive homestead status, a homestead application must be filed with the
assessor. The Social Security numbernew text begin or individual taxpayer identification numbernew text end of each
relative occupying the property and the name and Social Security numbernew text begin or individual
taxpayer identification number
new text end of the spouse of a relative occupying the property shall be
required on the homestead application filed under this subdivision. If a different relative of
the owner subsequently occupies the property, the owner of the property must notify the
assessor within 30 days of the change in occupancy. The Social Security numbernew text begin or individual
taxpayer identification number
new text end of a relative occupying the property or the spouse of a relative
occupying the property is private data on individuals as defined by section 13.02, subdivision
12
, but may be disclosed to the commissioner of revenue, or, for the purposes of proceeding
under the Revenue Recapture Act to recover personal property taxes owing, to the county
treasurer.

(e) The homestead application shall also notify the property owners that if the property
is granted homestead status for any assessment year, that same property shall remain
classified as homestead until the property is sold or transferred to another person, or the
owners, the spouse of the owner, or the relatives no longer use the property as their
homestead. Upon the sale or transfer of the homestead property, a certificate of value must
be timely filed with the county auditor as provided under section 272.115. Failure to notify
the assessor within 30 days that the property has been sold, transferred, or that the owner,
the spouse of the owner, or the relative is no longer occupying the property as a homestead,
shall result in the penalty provided under this subdivision and the property will lose its
current homestead status.

(f) If a homestead application has not been filed with the county by December 31, the
assessor shall classify the property as nonhomestead for the current assessment year for
taxes payable in the following year, provided that the owner may be entitled to receive the
homestead classification by proper application under section 375.192.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for homestead applications filed in 2023
and thereafter.
new text end

Sec. 4.

Minnesota Statutes 2022, section 273.124, subdivision 13c, is amended to read:


Subd. 13c.

Property lists.

In addition to lists of homestead properties, the commissioner
may ask the counties to furnish lists of all properties and the record owners. The Social
Security numbersnew text begin, individual taxpayer identification numbers,new text end and federal identification
numbers that are maintained by a county or city assessor for property tax administration
purposes, and that may appear on the lists retain their classification as private or nonpublic
data; but may be viewed, accessed, and used by the county auditor or treasurer of the same
county for the limited purpose of assisting the commissioner in the preparation of microdata
samples under section 270C.12. The commissioner shall use the information provided on
the lists as appropriate under the law, including for the detection of improper claims by
owners, or relatives of owners, under chapter 290A.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for homestead data provided to the
commissioner of revenue in 2024 and thereafter.
new text end

Sec. 5.

Minnesota Statutes 2022, section 273.124, subdivision 13d, is amended to read:


Subd. 13d.

Homestead data.

On or before April 30 each year beginning in 2007, each
county must provide the commissioner with the following data for each parcel of homestead
property by electronic means as defined in section 289A.02, subdivision 8:

(1) the property identification number assigned to the parcel for purposes of taxes payable
in the current year;

(2) the name and Social Security numbernew text begin or individual taxpayer identification numbernew text end
of each occupant of homestead property who is the property owner or qualifying relative
of a property owner, and the spouse of the property owner who occupies homestead property
or spouse of a qualifying relative of a property owner who occupies homestead property;

(3) the classification of the property under section 273.13 for taxes payable in the current
year and in the prior year;

(4) an indication of whether the property was classified as a homestead for taxes payable
in the current year because of occupancy by a relative of the owner or by a spouse of a
relative;

(5) the property taxes payable as defined in section 290A.03, subdivision 13, for the
current year and the prior year;

(6) the market value of improvements to the property first assessed for tax purposes for
taxes payable in the current year;

(7) the assessor's estimated market value assigned to the property for taxes payable in
the current year and the prior year;

(8) the taxable market value assigned to the property for taxes payable in the current
year and the prior year;

(9) whether there are delinquent property taxes owing on the homestead;

(10) the unique taxing district in which the property is located; and

(11) such other information as the commissioner decides is necessary.

The commissioner shall use the information provided on the lists as appropriate under
the law, including for the detection of improper claims by owners, or relatives of owners,
under chapter 290A.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for homestead data provided to the
commissioner of revenue in 2024 and thereafter.
new text end

Sec. 6.

Minnesota Statutes 2022, section 273.124, subdivision 14, is amended to read:


Subd. 14.

Agricultural homesteads; special provisions.

(a) Real estate of less than ten
acres that is the homestead of its owner must be classified as class 2a under section 273.13,
subdivision 23
, paragraph (a), if:

(1) the parcel on which the house is located is contiguous on at least two sides to (i)
agricultural land, (ii) land owned or administered by the United States Fish and Wildlife
Service, or (iii) land administered by the Department of Natural Resources on which in lieu
taxes are paid under sections 477A.11 to 477A.14 or section 477A.17;

(2) its owner also owns a noncontiguous parcel of agricultural land that is at least 20
acres;

(3) the noncontiguous land is located not farther than four townships or cities, or a
combination of townships or cities from the homestead; and

(4) the agricultural use value of the noncontiguous land and farm buildings is equal to
at least 50 percent of the market value of the house, garage, and one acre of land.

Homesteads initially classified as class 2a under the provisions of this paragraph shall
remain classified as class 2a, irrespective of subsequent changes in the use of adjoining
properties, as long as the homestead remains under the same ownership, the owner owns a
noncontiguous parcel of agricultural land that is at least 20 acres, and the agricultural use
value qualifies under clause (4). Homestead classification under this paragraph is limited
to property that qualified under this paragraph for the 1998 assessment.

(b)(i) Agricultural property shall be classified as the owner's homestead, to the same
extent as other agricultural homestead property, if all of the following criteria are met:

(1) the agricultural property consists of at least 40 acres including undivided government
lots and correctional 40's;

(2) the owner, the owner's spouse, or a grandchild, child, sibling, or parent of the owner
or of the owner's spouse, is actively farming the agricultural property, either on the person's
own behalf as an individual or on behalf of a partnership operating a family farm, family
farm corporation, joint family farm venture, or limited liability company of which the person
is a partner, shareholder, or member;

(3) both the owner of the agricultural property and the person who is actively farming
the agricultural property under clause (2), are Minnesota residents;

(4) neither the owner nor the spouse of the owner claims another agricultural homestead
in Minnesota; and

(5) neither the owner nor the person actively farming the agricultural property lives
farther than four townships or cities, or a combination of four townships or cities, from the
agricultural property, except that if the owner or the owner's spouse is required to live in
employer-provided housing, the owner or owner's spouse, whichever is actively farming
the agricultural property, may live more than four townships or cities, or combination of
four townships or cities from the agricultural property.

The relationship under this paragraph may be either by blood or marriage.

(ii) Property containing the residence of an owner who owns qualified property under
clause (i) shall be classified as part of the owner's agricultural homestead, if that property
is also used for noncommercial storage or drying of agricultural crops.

(iii) As used in this paragraph, "agricultural property" means class 2a property and any
class 2b property that is contiguous to and under the same ownership as the class 2a property.

(c) Noncontiguous land shall be included as part of a homestead under section 273.13,
subdivision 23
, paragraph (a), only if the homestead is classified as class 2a and the detached
land is located in the same township or city, or not farther than four townships or cities or
combination thereof from the homestead. Any taxpayer of these noncontiguous lands must
notify the county assessor that the noncontiguous land is part of the taxpayer's homestead,
and, if the homestead is located in another county, the taxpayer must also notify the assessor
of the other county.

(d) Agricultural land used for purposes of a homestead and actively farmed by a person
holding a vested remainder interest in it must be classified as a homestead under section
273.13, subdivision 23, paragraph (a). If agricultural land is classified class 2a, any other
dwellings on the land used for purposes of a homestead by persons holding vested remainder
interests who are actively engaged in farming the property, and up to one acre of the land
surrounding each homestead and reasonably necessary for the use of the dwelling as a home,
must also be assessed class 2a.

(e) Agricultural land and buildings that were class 2a homestead property under section
273.13, subdivision 23, paragraph (a), for the 1997 assessment shall remain classified as
agricultural homesteads for subsequent assessments if:

(1) the property owner abandoned the homestead dwelling located on the agricultural
homestead as a result of the April 1997 floods;

(2) the property is located in the county of Polk, Clay, Kittson, Marshall, Norman, or
Wilkin;

(3) the agricultural land and buildings remain under the same ownership for the current
assessment year as existed for the 1997 assessment year and continue to be used for
agricultural purposes;

(4) the dwelling occupied by the owner is located in Minnesota and is within 30 miles
of one of the parcels of agricultural land that is owned by the taxpayer; and

(5) the owner notifies the county assessor that the relocation was due to the 1997 floods,
and the owner furnishes the assessor any information deemed necessary by the assessor in
verifying the change in dwelling. Further notifications to the assessor are not required if the
property continues to meet all the requirements in this paragraph and any dwellings on the
agricultural land remain uninhabited.

(f) Agricultural land and buildings that were class 2a homestead property under section
273.13, subdivision 23, paragraph (a), for the 1998 assessment shall remain classified
agricultural homesteads for subsequent assessments if:

(1) the property owner abandoned the homestead dwelling located on the agricultural
homestead as a result of damage caused by a March 29, 1998, tornado;

(2) the property is located in the county of Blue Earth, Brown, Cottonwood, Le Sueur,
Nicollet, Nobles, or Rice;

(3) the agricultural land and buildings remain under the same ownership for the current
assessment year as existed for the 1998 assessment year;

(4) the dwelling occupied by the owner is located in this state and is within 50 miles of
one of the parcels of agricultural land that is owned by the taxpayer; and

(5) the owner notifies the county assessor that the relocation was due to a March 29,
1998, tornado, and the owner furnishes the assessor any information deemed necessary by
the assessor in verifying the change in homestead dwelling. For taxes payable in 1999, the
owner must notify the assessor by December 1, 1998. Further notifications to the assessor
are not required if the property continues to meet all the requirements in this paragraph and
any dwellings on the agricultural land remain uninhabited.

(g) Agricultural property of a family farm corporation, joint family farm venture, family
farm limited liability company, or partnership operating a family farm as described under
subdivision 8 shall be classified homestead, to the same extent as other agricultural homestead
property, if all of the following criteria are met:

(1) the property consists of at least 40 acres including undivided government lots and
correctional 40's;

(2) a shareholder, member, or partner of that entity is actively farming the agricultural
property;

(3) that shareholder, member, or partner who is actively farming the agricultural property
is a Minnesota resident;

(4) neither that shareholder, member, or partner, nor the spouse of that shareholder,
member, or partner claims another agricultural homestead in Minnesota; and

(5) that shareholder, member, or partner does not live farther than four townships or
cities, or a combination of four townships or cities, from the agricultural property.

Homestead treatment applies under this paragraph even if:

(i) the shareholder, member, or partner of that entity is actively farming the agricultural
property on the shareholder's, member's, or partner's own behalf; or

(ii) the family farm is operated by a family farm corporation, joint family farm venture,
partnership, or limited liability company other than the family farm corporation, joint family
farm venture, partnership, or limited liability company that owns the land, provided that:

(A) the shareholder, member, or partner of the family farm corporation, joint family
farm venture, partnership, or limited liability company that owns the land who is actively
farming the land is a shareholder, member, or partner of the family farm corporation, joint
family farm venture, partnership, or limited liability company that is operating the farm;
and

(B) more than half of the shareholders, members, or partners of each family farm
corporation, joint family farm venture, partnership, or limited liability company are persons
or spouses of persons who are a qualifying relative under section 273.124, subdivision 1,
paragraphs (c) and (d).

Homestead treatment applies under this paragraph for property leased to a family farm
corporation, joint farm venture, limited liability company, or partnership operating a family
farm if legal title to the property is in the name of an individual who is a member, shareholder,
or partner in the entity.

(h) To be eligible for the special agricultural homestead under this subdivision, an initial
full application must be submitted to the county assessor where the property is located.
Owners and the persons who are actively farming the property shall be required to complete
only a one-page abbreviated version of the application in each subsequent year provided
that none of the following items have changed since the initial application:

(1) the day-to-day operation, administration, and financial risks remain the same;

(2) the owners and the persons actively farming the property continue to live within the
four townships or city criteria and are Minnesota residents;

(3) the same operator of the agricultural property is listed with the Farm Service Agency;

(4) a Schedule F or equivalent income tax form was filed for the most recent year;

(5) the property's acreage is unchanged; and

(6) none of the property's acres have been enrolled in a federal or state farm program
since the initial application.

The owners and any persons who are actively farming the property must include the
appropriate Social Security numbersnew text begin or individual taxpayer identification numbersnew text end, and sign
and date the application. If any of the specified information has changed since the full
application was filed, the owner must notify the assessor, and must complete a new
application to determine if the property continues to qualify for the special agricultural
homestead. The commissioner of revenue shall prepare a standard reapplication form for
use by the assessors.

(i) Agricultural land and buildings that were class 2a homestead property under section
273.13, subdivision 23, paragraph (a), for the 2007 assessment shall remain classified
agricultural homesteads for subsequent assessments if:

(1) the property owner abandoned the homestead dwelling located on the agricultural
homestead as a result of damage caused by the August 2007 floods;

(2) the property is located in the county of Dodge, Fillmore, Houston, Olmsted, Steele,
Wabasha, or Winona;

(3) the agricultural land and buildings remain under the same ownership for the current
assessment year as existed for the 2007 assessment year;

(4) the dwelling occupied by the owner is located in this state and is within 50 miles of
one of the parcels of agricultural land that is owned by the taxpayer; and

(5) the owner notifies the county assessor that the relocation was due to the August 2007
floods, and the owner furnishes the assessor any information deemed necessary by the
assessor in verifying the change in homestead dwelling. For taxes payable in 2009, the
owner must notify the assessor by December 1, 2008. Further notifications to the assessor
are not required if the property continues to meet all the requirements in this paragraph and
any dwellings on the agricultural land remain uninhabited.

(j) Agricultural land and buildings that were class 2a homestead property under section
273.13, subdivision 23, paragraph (a), for the 2008 assessment shall remain classified as
agricultural homesteads for subsequent assessments if:

(1) the property owner abandoned the homestead dwelling located on the agricultural
homestead as a result of the March 2009 floods;

(2) the property is located in the county of Marshall;

(3) the agricultural land and buildings remain under the same ownership for the current
assessment year as existed for the 2008 assessment year and continue to be used for
agricultural purposes;

(4) the dwelling occupied by the owner is located in Minnesota and is within 50 miles
of one of the parcels of agricultural land that is owned by the taxpayer; and

(5) the owner notifies the county assessor that the relocation was due to the 2009 floods,
and the owner furnishes the assessor any information deemed necessary by the assessor in
verifying the change in dwelling. Further notifications to the assessor are not required if the
property continues to meet all the requirements in this paragraph and any dwellings on the
agricultural land remain uninhabited.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for homestead applications filed in 2023
and thereafter.
new text end

Sec. 7.

Minnesota Statutes 2022, section 273.1245, subdivision 1, is amended to read:


Subdivision 1.

Private or nonpublic data.

The following data are private or nonpublic
data as defined in section 13.02, subdivisions 9 and 12, when they are submitted to a county
or local assessor under section 273.124, 273.13, or another section, to support a claim for
the property tax homestead classification under section 273.13, or other property tax
classification or benefit:

(1) Social Security numbers;

(2)new text begin individual taxpayer identification numbers;
new text end

new text begin (3)new text end copies of state or federal income tax returns; and

deleted text begin (3)deleted text endnew text begin (4)new text end state or federal income tax return information, including the federal income tax
schedule F.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for homestead applications filed in 2023
and thereafter.
new text end

Sec. 8.

Minnesota Statutes 2022, section 273.1315, subdivision 2, is amended to read:


Subd. 2.

Class 1b homestead declaration 2009 and thereafter.

(a) Any property owner
seeking classification and assessment of the owner's homestead as class 1b property pursuant
to section 273.13, subdivision 22, paragraph (b), after October 1, 2008, shall file with the
county assessor a class 1b homestead declaration, on a form prescribed by the commissioner
of revenue. The declaration must contain the following information:

(1) the information necessary to verify that, on or before June 30 of the filing year, the
property owner or the owner's spouse satisfies the requirements of section 273.13, subdivision
22, paragraph (b), for class 1b classification; and

(2) any additional information prescribed by the commissioner.

(b) The declaration must be filed on or before October 1 to be effective for property
taxes payable during the succeeding calendar year. The Social Security numbersnew text begin, individual
taxpayer identification numbers,
new text end and income and medical information received from the
property owner pursuant to this subdivision are private data on individuals as defined in
section 13.02. If approved by the assessor, the declaration remains in effect until the property
no longer qualifies under section 273.13, subdivision 22, paragraph (b). Failure to notify
the assessor within 30 days that the property no longer qualifies under that paragraph because
of a sale, change in occupancy, or change in the status or condition of an occupant shall
result in the penalty provided in section 273.124, subdivision 13b, computed on the basis
of the class 1b benefits for the property, and the property shall lose its current class 1b
classification.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for homestead applications filed in 2023
and thereafter.
new text end

Sec. 9.

Minnesota Statutes 2022, section 290A.25, is amended to read:


290A.25 VERIFICATION OF SOCIAL SECURITY NUMBERS.

Annually, the commissioner of revenue shall furnish a list to the county assessor
containing the names deleted text beginanddeleted text endnew text begin,new text end Social Security numbersnew text begin, and individual taxpayer identification
numbers
new text end of persons who have applied for both homestead classification under section 273.13
and a property tax refund as a renter under this chapter.

Within 90 days of the notification, the county assessor shall investigate to determine if
the homestead classification was improperly claimed. If the property owner does not qualify,
the county assessor shall notify the county auditor who will determine the amount of
homestead benefits that has been improperly allowed. For the purpose of this section,
"homestead benefits" has the meaning given in section 273.124, subdivision 13b. The county
auditor shall send a notice to persons who owned the affected property at the time the
homestead application related to the improper homestead was filed, demanding
reimbursement of the homestead benefits plus a penalty equal to 100 percent of the homestead
benefits. The person notified may appeal the county's determination with the Minnesota
Tax Court within 60 days of the date of the notice from the county as provided in section
273.124, subdivision 13b.

If the amount of homestead benefits and penalty is not paid within 60 days, and if no
appeal has been filed, the county auditor shall certify the amount of taxes and penalty to
the county treasurer. The county treasurer will add interest to the unpaid homestead benefits
and penalty amounts at the rate provided for delinquent personal property taxes for the
period beginning 60 days after demand for payment was made until payment. If the person
notified is the current owner of the property, the treasurer may add the total amount of
benefits, penalty, interest, and costs to the real estate taxes otherwise payable on the property
in the following year. If the person notified is not the current owner of the property, the
treasurer may collect the amounts due under the Revenue Recapture Act in chapter 270A,
or use any of the powers granted in sections 277.20 and 277.21 without exclusion, to enforce
payment of the benefits, penalty, interest, and costs, as if those amounts were delinquent
tax obligations of the person who owned the property at the time the application related to
the improperly allowed homestead was filed. The treasurer may relieve a prior owner of
personal liability for the benefits, penalty, interest, and costs, and instead extend those
amounts on the tax lists against the property for taxes payable in the following year to the
extent that the current owner agrees in writing.

Any amount of homestead benefits recovered by the county from the property owner
shall be distributed to the county, city or town, and school district where the property is
located in the same proportion that each taxing district's levy was to the total of the three
taxing districts' levy for the current year. Any amount recovered attributable to taconite
homestead credit shall be transmitted to the St. Louis County auditor to be deposited in the
taconite property tax relief account. Any amount recovered that is attributable to supplemental
homestead credit is to be transmitted to the commissioner of revenue for deposit in the
general fund of the state treasury. The total amount of penalty collected must be deposited
in the county general fund.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for lists furnished by the commissioner
of revenue to county assessors in 2023 and thereafter.
new text end