1.1                          A bill for an act 
  1.2             relating to property tax refunds; modifying the 
  1.3             definition of property taxes payable; amending 
  1.4             Minnesota Statutes 2002, section 290A.03, subdivision 
  1.5             13. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 2002, section 290A.03, 
  1.8   subdivision 13, is amended to read: 
  1.9      Subd. 13.  [PROPERTY TAXES PAYABLE.] (a) "Initial property 
  1.10  taxes payable" means (i) the property tax exclusive of payable 
  1.11  on a claimant's homestead plus (ii) any fees or charges for 
  1.12  police or fire services included in the total amount on the 
  1.13  property tax statement, excluding charges related to capital 
  1.14  expenditures. 
  1.15     (b) "Property taxes payable" means initial property taxes 
  1.16  payable minus 
  1.17     (i) special assessments, other than fees or charges for 
  1.18  police or fire services that are included in paragraph (a)(ii); 
  1.19     (ii) penalties, and; 
  1.20     (iii) interest payable on a claimant's homestead after; 
  1.21     (iv) deductions made under sections 273.135, 273.1384, 
  1.22  273.1391, 273.42, subdivision 2, and any other state paid 
  1.23  property tax credits in any calendar year,; and after 
  1.24     (v) any refund claimed and allowable under section 290A.04, 
  1.25  subdivision 2h, that is first payable in the year that the 
  2.1   property tax is payable.  
  2.2      (c) In the case of a claimant who makes ground lease 
  2.3   payments, "property taxes payable" includes the amount of the 
  2.4   payments directly attributable to the property taxes assessed 
  2.5   against the parcel on which the house is located.  No 
  2.6   apportionment or reduction of the "property taxes payable" shall 
  2.7   be required for the use of a portion of the claimant's homestead 
  2.8   for a business purpose if the claimant does not deduct any 
  2.9   business depreciation expenses for the use of a portion of the 
  2.10  homestead in the determination of federal adjusted gross 
  2.11  income.  For homesteads which are manufactured homes as defined 
  2.12  in section 273.125, subdivision 8, and for homesteads which are 
  2.13  park trailers taxed as manufactured homes under section 168.012, 
  2.14  subdivision 9, "property taxes payable" shall also include 19 
  2.15  percent of the gross rent paid in the preceding year for the 
  2.16  site on which the homestead is located.  When a homestead is 
  2.17  owned by two or more persons as joint tenants or tenants in 
  2.18  common, such tenants shall determine between them which tenant 
  2.19  may claim the property taxes payable on the homestead.  If they 
  2.20  are unable to agree, the matter shall be referred to the 
  2.21  commissioner of revenue whose decision shall be final.  Property 
  2.22  taxes are considered payable in the year prescribed by law for 
  2.23  payment of the taxes. 
  2.24     (d) In the case of a claim relating to "property taxes 
  2.25  payable," the claimant must have owned and occupied the 
  2.26  homestead on January 2 of the year in which the tax is payable 
  2.27  and (i) the property must have been classified as homestead 
  2.28  property pursuant to section 273.124, on or before December 15 
  2.29  of the assessment year to which the "property taxes payable" 
  2.30  relate; or (ii) the claimant must provide documentation from the 
  2.31  local assessor that application for homestead classification has 
  2.32  been made on or before December 15 of the year in which the 
  2.33  "property taxes payable" were payable and that the assessor has 
  2.34  approved the application. 
  2.35     <b>[EFFECTIVE DATE.]</b> This section is effective for refunds 
  2.36  based on property taxes payable in 2005 and following years.