SF 3392

Introduction - 94th Legislature (2025 - 2026)

Posted on 04/23/2025 10:11 a.m.

A bill for an act
relating to taxation; modifying eligibility for certain tax programs and
classifications; amending Minnesota Statutes 2024, sections 273.124, subdivision
13; 290.0661, subdivision 1; 290.0671, subdivision 1.

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

Section 1.

Minnesota Statutes 2024, 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 number or individual taxpayer identification number 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 number or individual taxpayer identification number 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. new text begin For purposes of
this paragraph, an individual taxpayer identification number shall not be accepted by the
county assessor if the individual taxpayer identification number is assigned to an individual
who is a noncitizen of the United States who is either undocumented or otherwise not
lawfully present in the United States.
new text end

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 number or individual taxpayer identification number 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
number or individual taxpayer identification number 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 number or individual taxpayer identification number of each
relative occupying the property and the name and Social Security number or individual
taxpayer identification number 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 number or individual
taxpayer identification number 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 beginning with homestead applications
filed in 2026.
new text end

Sec. 2.

Minnesota Statutes 2024, section 290.0661, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

new text begin (a) new text end For the purposes of this section, "qualifying child" has
the meaning given in section 32(c) of the Internal Revenue Code, except:

(1) excluding individuals who attained the age of 18 or greater in the taxable year; and

(2) section 32(m) of the Internal Revenue Code does not apply.

new text begin (b) If the taxpayer and qualifying child are noncitizens, paragraph (a), clause (2), is
applicable only if the taxpayer and qualifying child are documented and lawfully present
in the United States.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after December
31, 2024.
new text end

Sec. 3.

Minnesota Statutes 2024, section 290.0671, subdivision 1, is amended to read:

Subdivision 1.

Credit allowed.

(a) An individual who is a resident of Minnesota is
allowed a credit against the tax imposed by this chapter equal to a percentage of earned
income. To receive a credit, a taxpayer must be eligible for a credit under section 32 of the
Internal Revenue Code, except that:

(1) a taxpayer with no qualifying children who has attained the age of 19, but not attained
age 65 before the close of the taxable year and is otherwise eligible for a credit under section
32 of the Internal Revenue Code may also receive a credit;

(2) a taxpayer who is otherwise eligible for a credit under section 32 of the Internal
Revenue Code remains eligible for the credit even if the taxpayer's earned income or adjusted
gross income exceeds the income limitation under section 32 of the Internal Revenue Code;
and

(3) section 32(m) of the Internal Revenue Code does not apply.

new text begin (b) If the taxpayer and qualifying child are noncitizens, paragraph (a), clause (3), is
applicable only if the taxpayer and qualifying child are documented and lawfully present
in the United States.
new text end

deleted text begin (b) deleted text end new text begin (c) new text end A taxpayer's working family credit equals four percent of the first $8,750 of
earned income.

deleted text begin (c) deleted text end new text begin (d) new text end The credit under this section is increased by:

(1) $925 for a taxpayer with one qualifying older child;

(2) $2,100 for a taxpayer with two qualifying older children; or

(3) $2,500 for a taxpayer with three or more qualifying older children.

deleted text begin (d) deleted text end new text begin (e) new text end The credit under this section is phased out jointly with the credit under section
290.0661, subdivision 4. For a taxpayer with one or more qualifying older children who
did not qualify for the credit under section 290.0661, the phaseout rate equals nine percent.

deleted text begin (e) deleted text end new text begin (f) new text end For a person who was a resident for the entire tax year and has earned income not
subject to tax under this chapter, the credit must be allocated based on the ratio of federal
adjusted gross income reduced by the earned income not subject to tax under this chapter
over federal adjusted gross income. For purposes of this paragraph, the following clauses
are not considered "earned income not subject to tax under this chapter":

(1) the subtractions for military pay under section 290.0132, subdivisions 11 and 12;

(2) the exclusion of combat pay under section 112 of the Internal Revenue Code; and

(3) income derived from an Indian reservation by an enrolled member of the reservation
while living on the reservation.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after December
31, 2024.
new text end