HF 1653

as introduced - 93rd Legislature (2023 - 2024) Posted on 02/13/2023 01:07pm

A bill for an act
relating to taxation; property tax refunds and individual income; converting the
renter's credit to a refundable income tax credit; amending Minnesota Statutes
2022, sections 270B.12, subdivision 8; 289A.38, subdivision 4; 289A.56,
subdivision 6; 289A.60, subdivision 12; 290A.02; 290A.03, subdivisions 3, 6, 8,
12; 290A.04, subdivision 1; 290A.05; 290A.07, subdivision 2a; 290A.08; 290A.09;
290A.091; 290A.13; 290A.19; 290A.25; 462A.05, subdivision 24; proposing
coding for new law in Minnesota Statutes, chapter 290; repealing Minnesota
Statutes 2022, sections 290A.03, subdivisions 9, 11; 290A.04, subdivisions 2a, 5;
290A.23, subdivision 1.

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 deleted text begin renter deleted text end new text begin renter's new text end credit.

The
commissioner may disclose names and Social Security numbers of individuals who have
applied for both homestead classification under section 273.13 and a deleted text begin property tax refund
as a renter under chapter 290A deleted text end new text begin renter's credit under section 290.0693 new text end 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 credits based on rent paid after
December 31, 2022.
new text end

Sec. 2.

Minnesota Statutes 2022, section 289A.38, subdivision 4, is amended to read:

Subd. 4.

Property tax refund.

For purposes of computing the limitation under this
section, the due date of the property tax refund return as provided for in chapter 290A is
the due date for an income tax return covering deleted text begin the year in which the rent was paid or deleted text end the
year preceding the year in which the property taxes are payable.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for credits based on rent paid after
December 31, 2022.
new text end

Sec. 3.

Minnesota Statutes 2022, section 289A.56, subdivision 6, is amended to read:

Subd. 6.

Property tax refunds under chapter 290A.

deleted text begin (a) When a renter is owed a
property tax refund, an unpaid refund bears interest after August 14, or 60 days after the
refund claim was made, whichever is later, until the date the refund is paid.
deleted text end

deleted text begin (b) deleted text end When deleted text begin any other deleted text end new text begin a new text end claimant is owed a property tax refund new text begin under chapter 290A new text end , the
unpaid refund bears interest after September 29, or 60 days after the refund claim was made,
whichever is later, until the date the refund is paid.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for credits based on rent paid after
December 31, 2022.
new text end

Sec. 4.

Minnesota Statutes 2022, section 289A.60, subdivision 12, is amended to read:

Subd. 12.

Penalties relating to property tax refunds.

(a) If it is determined that a
property tax refund claim is excessive and was negligently prepared, a claimant is liable
for a penalty of ten percent of the disallowed claim. If the claim has been paid, the amount
disallowed must be recovered by assessment and collection.

(b) An owner who without reasonable cause fails to give a certificate of rent constituting
property tax to a renter, as required by deleted text begin section deleted text end new text begin sections 290.0693, subdivision 4, and new text end 290A.19,
paragraph (a), is liable to the commissioner for a penalty of $100 for each failure.

(c) If the owner or managing agent knowingly gives rent certificates that report total
rent constituting property taxes in excess of the amount of actual rent constituting property
taxes paid on the rented part of a property, the owner or managing agent is liable for a
penalty equal to the greater of (1) $100 or (2) 50 percent of the excess that is reported. An
overstatement of rent constituting property taxes is presumed to be knowingly made if it
exceeds by ten percent or more the actual rent constituting property taxes.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for credits based on rent paid after
December 31, 2022.
new text end

Sec. 5.

new text begin [290.0693] RENTER'S CREDIT.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For the purposes of this section, the following terms have
the meanings given.
new text end

new text begin (b) "Dependent" means any individual who is considered a dependent under sections
151 and 152 of the Internal Revenue Code.
new text end

new text begin (c) "Disability" has the meaning given in section 290A.03, subdivision 10.
new text end

new text begin (d) "Exemption amount" means the exemption amount under section 290.0121,
subdivision 1, paragraph (b).
new text end

new text begin (e) "Gross rent" means rent paid for the right of occupancy, at arm's length, of a
homestead, exclusive of charges for any medical services furnished by the landlord as a
part of the rental agreement, whether expressly set out in the rental agreement or not. The
gross rent of a resident of a nursing home or intermediate care facility is $600 per month.
The gross rent of a resident of an adult foster care home is $930 per month. The commissioner
shall annually adjust the amounts in this paragraph as provided in section 270C.22. The
statutory year is 2023. If the landlord and tenant have not dealt with each other at arm's
length and the commissioner determines that the gross rent charged was excessive, the
commissioner may adjust the gross rent to a reasonable amount for purposes of this section.
new text end

new text begin (f) "Homestead" has the meaning given in section 290A.03, subdivision 6.
new text end

new text begin (g) "Household" has the meaning given in section 290A.03, subdivision 4.
new text end

new text begin (h) "Household income" means all income received by all persons of a household in a
taxable year while members of the household, other than income of a dependent.
new text end

new text begin (i) "Income" means adjusted gross income, minus:
new text end

new text begin (1) for the taxpayer's first dependent, the exemption amount multiplied by 1.4;
new text end

new text begin (2) for the taxpayer's second dependent, the exemption amount multiplied by 1.3;
new text end

new text begin (3) for the taxpayer's third dependent, the exemption amount multiplied by 1.2;
new text end

new text begin (4) for the taxpayer's fourth dependent, the exemption amount multiplied by 1.1;
new text end

new text begin (5) for the taxpayer's fifth dependent, the exemption amount; and
new text end

new text begin (6) if the taxpayer or taxpayer's spouse had a disability or attained the age of 65 on or
before the close of the taxable year, the exemption amount.
new text end

new text begin (j) "Rent constituting property taxes" means 17 percent of the gross rent actually paid
in cash, or its equivalent, or the portion of rent paid in lieu of property taxes, in any taxable
year by a claimant for the right of occupancy of the claimant's Minnesota homestead in the
taxable year, and which rent constitutes the basis, in the succeeding taxable year of a claim
for a credit under this section by the claimant. If an individual occupies a homestead with
another person or persons not related to the individual as the individual's spouse or as
dependents, and the other person or persons are residing at the homestead under a rental or
lease agreement with the individual, the amount of rent constituting property tax for the
individual equals that portion not covered by the rental agreement.
new text end

new text begin Subd. 2. new text end

new text begin Credit allowed; refundable. new text end

new text begin (a) An individual is allowed a credit against the
tax due under this chapter equal to the amount that rent constituting property taxes exceeds
the percentage of the household income of the claimant specified in subdivision 3 in the
taxable year in which the rent was paid as specified in that subdivision.
new text end

new text begin (b) If the amount of credit which a taxpayer is eligible to receive under this section
exceeds the taxpayer's liability for tax under this chapter, the commissioner shall refund the
excess to the taxpayer.
new text end

new text begin Subd. 3. new text end

new text begin Renters. new text end

new text begin (a) A taxpayer whose rent constituting property taxes exceeds the
percentage of the household income stated below must pay an amount equal to the percent
of income shown for the appropriate household income level along with the co-payment of
the remaining amount of rent constituting property taxes. The credit under subdivision 2
equals the amount of rent constituting property taxes that remain, up to the maximum credit
amount shown below.
new text end

new text begin Household Income new text end	new text begin Percent of Income new text end	new text begin Co-payment new text end	new text begin Maximum Credit new text end
new text begin $0 to 6,329 new text end	new text begin 1.0 percent new text end	new text begin 5 percent new text end	new text begin $ new text end	new text begin 2,580 new text end
new text begin 6,330 to 8,409 new text end	new text begin 1.0 percent new text end	new text begin 10 percent new text end	new text begin $ new text end	new text begin 2,580 new text end
new text begin 8,410 to 10,509 new text end	new text begin 1.1 percent new text end	new text begin 10 percent new text end	new text begin $ new text end	new text begin 2,510 new text end
new text begin 10,510 to 14,739 new text end	new text begin 1.2 percent new text end	new text begin 10 percent new text end	new text begin $ new text end	new text begin 2,450 new text end
new text begin 14,740 to 18,959 new text end	new text begin 1.3 percent new text end	new text begin 15 percent new text end	new text begin $ new text end	new text begin 2,380 new text end
new text begin 18,960 to 21,049 new text end	new text begin 1.4 percent new text end	new text begin 15 percent new text end	new text begin $ new text end	new text begin 2,320 new text end
new text begin 21,050 to 23,139 new text end	new text begin 1.4 percent new text end	new text begin 20 percent new text end	new text begin $ new text end	new text begin 2,260 new text end
new text begin 23,140 to 27,369 new text end	new text begin 1.5 percent new text end	new text begin 20 percent new text end	new text begin $ new text end	new text begin 2,190 new text end
new text begin 27,370 to 29,469 new text end	new text begin 1.6 percent new text end	new text begin 20 percent new text end	new text begin $ new text end	new text begin 2,130 new text end
new text begin 29,470 to 31,579 new text end	new text begin 1.7 percent new text end	new text begin 25 percent new text end	new text begin $ new text end	new text begin 2,130 new text end
new text begin 31,580 to 35,789 new text end	new text begin 1.8 percent new text end	new text begin 25 percent new text end	new text begin $ new text end	new text begin 2,130 new text end
new text begin 35,790 to 37,879 new text end	new text begin 1.9 percent new text end	new text begin 30 percent new text end	new text begin $ new text end	new text begin 2,130 new text end
new text begin 37,880 to 44,199 new text end	new text begin 2.0 percent new text end	new text begin 30 percent new text end	new text begin $ new text end	new text begin 2,130 new text end
new text begin 44,200 to 50,509 new text end	new text begin 2.0 percent new text end	new text begin 35 percent new text end	new text begin $ new text end	new text begin 2,130 new text end
new text begin 50,510 to 58,939 new text end	new text begin 2.0 percent new text end	new text begin 40 percent new text end	new text begin $ new text end	new text begin 2,130 new text end
new text begin 58,940 to 61,039 new text end	new text begin 2.0 percent new text end	new text begin 45 percent new text end	new text begin $ new text end	new text begin 1,930 new text end
new text begin 61,040 to 63,149 new text end	new text begin 2.0 percent new text end	new text begin 45 percent new text end	new text begin $ new text end	new text begin 1,740 new text end
new text begin 63,150 to 65,259 new text end	new text begin 2.0 percent new text end	new text begin 45 percent new text end	new text begin $ new text end	new text begin 1,480 new text end
new text begin 65,260 to 67,359 new text end	new text begin 2.0 percent new text end	new text begin 50 percent new text end	new text begin $ new text end	new text begin 1,290 new text end
new text begin 67,360 to 69,469 new text end	new text begin 2.0 percent new text end	new text begin 50 percent new text end	new text begin $ new text end	new text begin 1,170 new text end
new text begin 69,470 to 71,569 new text end	new text begin 2.0 percent new text end	new text begin 50 percent new text end	new text begin $ new text end	new text begin 650 new text end
new text begin 71,570 to 73,679 new text end	new text begin 2.0 percent new text end	new text begin 50 percent new text end	new text begin $ new text end	new text begin 250 new text end

new text begin The credit is the amount calculated under this subdivision. No credit is allowed if the
taxpayer's household income is $73,680 or more.
new text end

new text begin (b) The commissioner must annually adjust the dollar amounts of the income thresholds
and the maximum refunds in paragraph (a), as provided in section 270C.22. The statutory
year is 2023.
new text end

new text begin (c) The commissioner shall construct and make available to taxpayers a comprehensive
table showing the rent constituting property taxes to be paid and refund allowed at various
levels of income and assessment. The table shall follow the schedule of income percentages,
maximums, and other provisions specified in paragraph (a), except that the commissioner
may graduate the transition between income brackets. All refunds shall be computed in
accordance with tables prepared and issued by the commissioner.
new text end

new text begin Subd. 4. new text end

new text begin Owner or managing agent to furnish rent certificate. new text end

new text begin (a) The owner or
managing agent of any property for which rent is paid for occupancy as a homestead must
furnish a certificate of rent paid to a person who is a renter on December 31, in the form
prescribed by the commissioner. If the renter moves before December 31, the owner or
managing agent may give the certificate to the renter at the time of moving, or mail the
certificate to the forwarding address if an address has been provided by the renter. The
certificate must be made available to the renter before February 1 of the year following the
year in which the rent was paid. The owner or managing agent must retain a duplicate of
each certificate or an equivalent record showing the same information for a period of three
years. The duplicate or other record must be made available to the commissioner upon
request.
new text end

new text begin (b) The commissioner may require the owner or managing agent, through a simple
process, to furnish to the commissioner on or before March 1 a copy of each certificate of
rent paid furnished to a renter for rent paid in the prior year. The commissioner shall prescribe
the content, format, and manner of the form pursuant to section 270C.30. The commissioner
may require the Social Security number, individual taxpayer identification number, federal
employer identification number, or Minnesota taxpayer identification number of the owner
or managing agent who is required to furnish a certificate of rent paid under this paragraph.
Before implementation, the commissioner, after consulting with representatives of owners
or managing agents, shall develop an implementation and administration plan for the
requirements of this paragraph that attempts to minimize financial burdens, administration
and compliance costs, and takes into consideration existing systems of owners and managing
agents.
new text end

new text begin Subd. 5. new text end

new text begin Eligibility; residency. new text end

new text begin (a) A taxpayer is eligible for the credit under this section
if the taxpayer is an individual, other than a dependent, as defined under sections 151 and
152 of the Internal Revenue Code, disregarding section 152(b)(3) of the Internal Revenue
Code, who filed for a credit and who was a resident of this state during the taxable year for
which the credit was claimed.
new text end

new text begin (b) In the case of a credit for rent constituting property taxes of a part-year Minnesota
resident, the household income and rent constituting property taxes reflected in this
computation shall be for the period of Minnesota residency only. Any rental expenses paid
that may be reflected in arriving at federal adjusted gross income cannot be utilized for this
computation.
new text end

new text begin (c) When two individuals of a household are able to meet the qualifications to claim a
credit under this section, the individuals may determine among them as to which individual
may claim the credit. If the individuals are unable to agree, the matter shall be referred to
the commissioner of revenue whose decision shall be final.
new text end

new text begin (d) To claim a credit under this section, the taxpayer must have resided in a rented or
leased unit on which ad valorem taxes or payments made in lieu of ad valorem taxes,
including payments of special assessments imposed in lieu of ad valorem taxes, are payable
at some time during the taxable year for which the taxpayer claimed the credit.
new text end

new text begin Subd. 6. new text end

new text begin Residents of nursing homes, intermediate care facilities, long-term care
facilities, or facilities accepting housing support payments. new text end

new text begin (a) A taxpayer must not claim
a credit under this section if the taxpayer is a resident of a nursing home, intermediate care
facility, long-term residential facility, or a facility that accepts housing support payments
whose rent constituting property taxes is paid pursuant to the Supplemental Security Income
program under title XVI of the Social Security Act, the Minnesota supplemental aid program
under sections 256D.35 to 256D.54, the medical assistance program pursuant to title XIX
of the Social Security Act, or the housing support program under chapter 256I.
new text end

new text begin (b) If only a portion of the rent constituting property taxes is paid by these programs,
the resident is eligible for a credit, but the credit calculated must be multiplied by a fraction,
the numerator of which is adjusted gross income, reduced by the total amount of income
from the above sources other than vendor payments under the medical assistance program
and the denominator of which is adjusted gross income, plus vendor payments under the
medical assistance program, to determine the allowable credit.
new text end

new text begin (c) Notwithstanding paragraphs (a) and (b), if the taxpayer was a resident of the nursing
home, intermediate care facility, long-term residential facility, or facility for which the rent
was paid for the claimant by the housing support program for only a portion of the taxable
year covered by the claim, the taxpayer may compute rent constituting property taxes by
disregarding the rent constituting property taxes from the nursing home or facility and may
use only that amount of rent constituting property taxes or property taxes payable relating
to that portion of the year when the taxpayer was not in the facility. The taxpayer's household
income is the income for the entire taxable year covered by the claim.
new text end

new text begin Subd. 7. new text end

new text begin Credit for unmarried taxpayers residing in the same household. new text end

new text begin If a
homestead is occupied by two or more renters who are not married to each other, the rent
shall be deemed to be paid equally by each renter, and separate claims shall be filed by each
renter. The income of each renter shall be each renter's household income for purposes of
computing the amount of credit to be allowed.
new text end

new text begin Subd. 8. new text end

new text begin One claimant per household. new text end

new text begin Only one taxpayer per household per year is
entitled to claim a credit under this section. In the case of a married taxpayer filing a separate
return, only one spouse may claim the credit under this section. The credit amount for the
spouse that claims the credit must be calculated based on household income and not solely
on the income of the spouse.
new text end

new text begin Subd. 9. new text end

new text begin Proof of claim. new text end

new text begin (a) Every taxpayer claiming a credit under this section shall
supply to the commissioner of revenue, in support of the claim, proof of eligibility under
this section, including but not limited to amount of rent paid, name and address of owner
or managing agent of property rented, changes in household membership, and household
income.
new text end

new text begin (b) Taxpayers with a disability shall submit proof of disability in the form and manner
as the commissioner prescribes. The department may require examination and certification
by the taxpayer's physician or by a physician designated by the commissioner. The cost of
any examination shall be borne by the taxpayer, unless the examination proves the disability,
in which case the cost of the examination shall be borne by the commissioner.
new text end

new text begin (c) A determination of disability of a taxpayer by the Social Security Administration
under Title II or Title XVI of the Social Security Act shall constitute presumptive proof of
disability.
new text end

new text begin Subd. 10. new text end

new text begin No relief allowed in certain cases. new text end

new text begin No claim for a credit under this section
shall be allowed if the commissioner determines that the claimant received tenancy to the
homestead primarily for the purpose of receiving a credit under this section and not for bona
fide residence purposes.
new text end

new text begin Subd. 11. new text end

new text begin Appropriation. new text end

new text begin The amount necessary to pay the refunds under this section
is appropriated from the general fund to the commissioner.
new text end

new text begin Subd. 12. new text end

new text begin Simplified filing for individuals without an income tax liability. new text end

new text begin The
commissioner of revenue must establish a simplified filing process through which a taxpayer
who did not file an individual income tax return due to a lack of tax liability may file a
return to claim the credit under this section. The filing process and forms may be in the
form or manner determined by the commissioner, but must be designed to reduce the
complexity of the filing process and the time needed to file for individuals without an income
tax liability.
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, 2022.
new text end

Sec. 6.

Minnesota Statutes 2022, section 290A.02, is amended to read:

290A.02 PURPOSE.

The purpose of this chapter is to provide property tax relief to certain persons who own
deleted text begin or rent deleted text end their homesteads.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 7.

Minnesota Statutes 2022, section 290A.03, subdivision 3, is amended to read:

Subd. 3.

Income.

(a) "Income" means the sum of the following:

(1) federal adjusted gross income as defined in the Internal Revenue Code; and

(2) the sum of the following amounts to the extent not included in clause (1):

(i) all nontaxable income;

(ii) the amount of a passive activity loss that is not disallowed as a result of section 469,
paragraph (i) or (m) of the Internal Revenue Code and the amount of passive activity loss
carryover allowed under section 469(b) of the Internal Revenue Code;

(iii) an amount equal to the total of any discharge of qualified farm indebtedness of a
solvent individual excluded from gross income under section 108(g) of the Internal Revenue
Code;

(iv) cash public assistance and relief;

(v) any pension or annuity (including railroad retirement benefits, all payments received
under the federal Social Security Act, Supplemental Security Income, and veterans benefits),
which was not exclusively funded by the claimant or spouse, or which was funded exclusively
by the claimant or spouse and which funding payments were excluded from federal adjusted
gross income in the years when the payments were made;

(vi) interest received from the federal or a state government or any instrumentality or
political subdivision thereof;

(vii) workers' compensation;

(viii) nontaxable strike benefits;

(ix) the gross amounts of payments received in the nature of disability income or sick
pay as a result of accident, sickness, or other disability, whether funded through insurance
or otherwise;

(x) a lump-sum distribution under section 402(e)(3) of the Internal Revenue Code of
1986, as amended through December 31, 1995;

(xi) contributions made by the claimant to an individual retirement account, including
a qualified voluntary employee contribution; simplified employee pension plan;
self-employed retirement plan; cash or deferred arrangement plan under section 401(k) of
the Internal Revenue Code; or deferred compensation plan under section 457 of the Internal
Revenue Code, to the extent the sum of amounts exceeds the retirement base amount for
the claimant and spouse;

(xii) to the extent not included in federal adjusted gross income, distributions received
by the claimant or spouse from a traditional or Roth style retirement account or plan;

(xiii) nontaxable scholarship or fellowship grants;

(xiv) alimony received to the extent not included in the recipient's income;

(xv) the amount of deduction allowed under section 220 or 223 of the Internal Revenue
Code;

(xvi) the amount deducted for tuition expenses under section 222 of the Internal Revenue
Code; and

(xvii) the amount deducted for certain expenses of elementary and secondary school
teachers under section 62(a)(2)(D) of the Internal Revenue Code.

In the case of an individual who files an income tax return on a fiscal year basis, the
term "federal adjusted gross income" shall mean federal adjusted gross income reflected in
the fiscal year ending in the calendar year. Federal adjusted gross income shall not be reduced
by the amount of a net operating loss carryback or carryforward or a capital loss carryback
or carryforward allowed for the year.

(b) "Income" does not include:

(1) amounts excluded pursuant to the Internal Revenue Code, sections 101(a) and 102;

(2) amounts of any pension or annuity which was exclusively funded by the claimant
or spouse and which funding payments were not excluded from federal adjusted gross
income in the years when the payments were made;

(3) to the extent included in federal adjusted gross income, amounts contributed by the
claimant or spouse to a traditional or Roth style retirement account or plan, but not to exceed
the retirement base amount reduced by the amount of contributions excluded from federal
adjusted gross income, but not less than zero;

(4) surplus food or other relief in kind supplied by a governmental agency;

(5) relief granted under this chapter;

(6) child support payments received under a temporary or final decree of dissolution or
legal separation;

(7) restitution payments received by eligible individuals and excludable interest as
defined in section 803 of the Economic Growth and Tax Relief Reconciliation Act of 2001,
Public Law 107-16;

(8) alimony paid; or

(9) veterans disability compensation paid under title 38 of the United States Code.

(c) The sum of the following amounts may be subtracted from income:

(1) for the claimant's first dependent, the exemption amount multiplied by 1.4;

(2) for the claimant's second dependent, the exemption amount multiplied by 1.3;

(3) for the claimant's third dependent, the exemption amount multiplied by 1.2;

(4) for the claimant's fourth dependent, the exemption amount multiplied by 1.1;

(5) for the claimant's fifth dependent, the exemption amount; and

(6) if the claimant or claimant's spouse had a disability or attained the age of 65 on or
before December 31 of the year for which the taxes were levied deleted text begin or rent paid deleted text end , the exemption
amount.

(d) For purposes of this subdivision, the following terms have the meanings given:

(1) "exemption amount" means the exemption amount under section 290.0121,
subdivision 1, paragraph (b), for the taxable year for which the income is reported;

(2) "retirement base amount" means the deductible amount for the taxable year for the
claimant and spouse under section 219(b)(5)(A) of the Internal Revenue Code, adjusted for
inflation as provided in section 219(b)(5)(C) of the Internal Revenue Code, without regard
to whether the claimant or spouse claimed a deduction; and

(3) "traditional or Roth style retirement account or plan" means retirement plans under
sections 401, 403, 408, 408A, and 457 of the Internal Revenue Code.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 8.

Minnesota Statutes 2022, section 290A.03, subdivision 6, is amended to read:

Subd. 6.

Homestead.

"Homestead" means the dwelling occupied as the claimant's
principal residence and so much of the land surrounding it, not exceeding ten acres, as is
reasonably necessary for use of the dwelling as a home and any other property used for
purposes of a homestead as defined in section 273.13, subdivision 22, except for agricultural
land assessed as part of a homestead pursuant to section 273.13, subdivision 23, "homestead"
is limited to the house and garage and immediately surrounding one acre of land. The
homestead may be owned deleted text begin or rented and may be deleted text end new text begin as new text end a part of a multidwelling or multipurpose
building and the land on which it is built. A manufactured home, as defined in section
273.125, subdivision 8, or a park trailer taxed as a manufactured home under section 168.012,
subdivision 9, assessed as personal property may be a dwelling for purposes of this
subdivision.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 9.

Minnesota Statutes 2022, section 290A.03, subdivision 8, is amended to read:

Subd. 8.

Claimant.

deleted text begin (a) deleted text end "Claimant" means a person, other than a dependent, as defined
under sections 151 and 152 of the Internal Revenue Code disregarding section 152(b)(3)
of the Internal Revenue Code, who filed a claim authorized by this chapter and who was a
resident of this state as provided in chapter 290 during the calendar year for which the claim
for relief was filed.

deleted text begin (b) In the case of a claim relating to rent constituting property taxes, the claimant shall
have resided in a rented or leased unit on which ad valorem taxes or payments made in lieu
of ad valorem taxes, including payments of special assessments imposed in lieu of ad valorem
taxes, are payable at some time during the calendar year covered by the claim.
deleted text end

deleted text begin (c) "Claimant" shall not include a resident of a nursing home, intermediate care facility,
long-term residential facility, or a facility that accepts housing support payments whose
rent constituting property taxes is paid pursuant to the Supplemental Security Income
program under title XVI of the Social Security Act, the Minnesota supplemental aid program
under sections 256D.35 to 256D.54, the medical assistance program pursuant to title XIX
of the Social Security Act, or the housing support program under chapter 256I.
deleted text end

deleted text begin If only a portion of the rent constituting property taxes is paid by these programs, the
resident shall be a claimant for purposes of this chapter, but the refund calculated pursuant
to section 290A.04 shall be multiplied by a fraction, the numerator of which is income as
defined in subdivision 3, paragraphs (a) and (b), reduced by the total amount of income
from the above sources other than vendor payments under the medical assistance program
and the denominator of which is income as defined in subdivision 3, paragraphs (a) and (b),
plus vendor payments under the medical assistance program, to determine the allowable
refund pursuant to this chapter.
deleted text end

deleted text begin (d) Notwithstanding paragraph (c), if the claimant was a resident of the nursing home,
intermediate care facility, long-term residential facility, or facility for which the rent was
paid for the claimant by the housing support program for only a portion of the calendar year
covered by the claim, the claimant may compute rent constituting property taxes by
disregarding the rent constituting property taxes from the nursing home or facility and use
only that amount of rent constituting property taxes or property taxes payable relating to
that portion of the year when the claimant was not in the facility. The claimant's household
income is the income for the entire calendar year covered by the claim.
deleted text end

deleted text begin (e) In the case of a claim for rent constituting property taxes of a part-year Minnesota
deleted text end deleted text begin resident, the income and rent reflected in this computation shall be for the period of
deleted text end deleted text begin Minnesota residency only. Any rental expenses paid which may be reflected in arriving at
deleted text end deleted text begin federal adjusted gross income cannot be utilized for this computation. When two individuals
deleted text end deleted text begin of a household are able to meet the qualifications for a claimant, they may determine among
deleted text end deleted text begin them as to who the claimant shall be. If they are unable to agree, the matter shall be referred
deleted text end deleted text begin to the commissioner of revenue whose decision shall be final. deleted text end If a homestead property owner
was a part-year Minnesota resident, the income reflected in the computation made pursuant
to section 290A.04 shall be for the entire calendar year, including income not assignable to
Minnesota.

deleted text begin (f) If a homestead is occupied by two or more renters, who are not married to each other,
the rent shall be deemed to be paid equally by each, and separate claims shall be filed by
each. The income of each shall be each renter's household income for purposes of computing
the amount of credit to be allowed.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 10.

Minnesota Statutes 2022, section 290A.03, subdivision 12, is amended to read:

Subd. 12.

Gross rent.

(a) "Gross rent" means rent paid for the right of occupancy, at
arm's length, of a new text begin site on which a new text end homestead, deleted text begin exclusive of charges for any medical services
furnished by the landlord as a part of the rental agreement, whether expressly set out in the
rental agreement or not deleted text end new text begin which is a manufactured home as defined in section 273.125,
subdivision 8, including a manufactured home located in a manufactured home community
owned by a cooperative organized under chapter 308A or 308B, and park trailers taxed as
manufactured homes under section 168.012, subdivision 9, is located new text end .

deleted text begin (b) The gross rent of a resident of a nursing home or intermediate care facility is $500
per month. The gross rent of a resident of an adult foster care home is $780 per month. The
commissioner shall annually adjust the amounts in this paragraph as provided in section
270C.22. The statutory year is 2018.
deleted text end

deleted text begin (c) deleted text end new text begin (b) new text end If the landlord and tenant have not dealt with each other at arm's length and the
commissioner determines that the gross rent charged was excessive, the commissioner may
adjust the gross rent to a reasonable amount for purposes of this chapter.

deleted text begin (d) deleted text end new text begin (c) new text end Any amount paid by a claimant residing in property assessed pursuant to section
273.124, subdivision 3, 4, 5, or 6 for occupancy in that property deleted text begin shall be excluded from
gross rent for purposes of this chapter. However, property taxes imputed to the homestead
of the claimant or the dwelling unit occupied by the claimant that qualifies for homestead
treatment pursuant to section 273.124, subdivision 3, 4, 5, or 6 deleted text end shall be included within the
term "property taxes payable" as defined in subdivision 13, new text begin to the extent allowed,
new text end notwithstanding the fact that ownership is not in the name of the claimant.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 11.

Minnesota Statutes 2022, section 290A.04, subdivision 1, is amended to read:

Subdivision 1.

Refund.

A refund shall be allowed each claimant in the amount that
property taxes payable deleted text begin or rent constituting property taxes deleted text end exceed the percentage of the
household income of the claimant specified in subdivision 2 deleted text begin or 2a deleted text end in the year for which the
taxes were levied deleted text begin or in the year in which the rent was paid deleted text end as specified in subdivision 2 deleted text begin or
2a deleted text end . If the amount of property taxes payable deleted text begin or rent constituting property taxes deleted text end is equal to
or less than the percentage of the household income of the claimant specified in subdivision
2 deleted text begin or 2a deleted text end in the year for which the taxes were levied deleted text begin or in the year in which the rent was paid deleted text end ,
the claimant shall not be eligible for a state refund pursuant to this section.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 12.

Minnesota Statutes 2022, section 290A.05, is amended to read:

290A.05 COMBINED HOUSEHOLD INCOME new text begin ; RENTAL AGREEMENTS AND
REDUCTION OF PROPERTY TAXES PAYABLE new text end .

new text begin (a) new text end If a person occupies a homestead with another person not related to the person as
the person's spouse, excluding dependents, roomers or boarders on contract, and has property
tax payable with respect to the homestead, the household income of the claimant or claimants
for the purpose of computing the refund allowed by section 290A.04 shall include the total
income received by the other persons residing in the homestead. For purposes of this section,
"dependent" includes a parent of the claimant or spouse who lives in the claimant's homestead
and does not have an ownership interest in the homestead.

new text begin (b) new text end If a person occupies a homestead with another person or persons not related to the
person as the person's spouse or as dependents, deleted text begin the property tax payable or rent constituting
property tax shall be reduced as follows.
deleted text end

deleted text begin If deleted text end new text begin and new text end the other person or persons are residing at the homestead under new text begin a new text end rental or lease
agreement new text begin with the homeowner new text end , the amount of property tax payable deleted text begin or rent constituting
property tax shall be deleted text end new text begin equals new text end that portion not covered by the rental agreement.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and property taxes payable in 2024, and following years.
new text end

Sec. 13.

Minnesota Statutes 2022, section 290A.07, subdivision 2a, is amended to read:

Subd. 2a.

Time of payment to deleted text begin renter or deleted text end manufactured home homeowner.

A claimant
who is deleted text begin a renter or deleted text end a homeowner who occupies a manufactured home, as defined in section
273.125, subdivision 8, paragraph (c), or a park trailer taxed as a manufactured home under
section 168.012, subdivision 9, shall receive full payment after August 1 and before August
15 or 60 days after receipt of the application, whichever is later.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 14.

Minnesota Statutes 2022, section 290A.08, is amended to read:

290A.08 ONE CLAIMANT PER HOUSEHOLD.

Only one claimant per household per year is entitled to relief under this chapter. Payment
of the claim for relief may be made payable to the spouses as one claimant. The
commissioner, upon written request, may issue separate checks, to the spouses for one-half
of the relief provided the original check has not been issued or has been returned. Individuals
related as spouses who were married during the year may elect to file a joint claim which
shall include each spouse's income deleted text begin , rent constituting property taxes, deleted text end and property taxes
payable. Spouses who were married for the entire year and were domiciled in the same
household for the entire year must file a joint claim. The maximum dollar amount allowable
for a joint claim shall not exceed the amount that one person could receive.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 15.

Minnesota Statutes 2022, section 290A.09, is amended to read:

290A.09 PROOF OF CLAIM.

Every claimant shall supply to the commissioner of revenue, in support of the claim,
proof of eligibility under this chapter, including but not limited to amount of deleted text begin rent paid or deleted text end
property taxes accrued, deleted text begin name and address of owner or managing agent of property rented, deleted text end
changes in homestead, household membership, household income, size and nature of property
claimed as a homestead.

Persons with a disability filing claims shall submit proof of disability in the form and
manner as the commissioner may prescribe. The department may require examination and
certification by the claimant's physician or by a physician designated by the commissioner.
The cost of any examination shall be borne by the claimant, unless the examination proves
the disability, in which case the cost of the examination shall be borne by the commissioner.

A determination of disability of a claimant by the Social Security Administration under
Title II or Title XVI of the Social Security Act shall constitute presumptive proof of disability.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 16.

Minnesota Statutes 2022, section 290A.091, is amended to read:

290A.091 CLAIMS OF TENANTS IN LEASEHOLD COOPERATIVES.

The cooperative manager of a leasehold cooperative shall furnish a statement to each
tenant by March 31 of the year in which the property tax is payable showing each unit's
share of the gross property tax and each unit's share of any property tax credits. Each tenant
may apply for a property tax refund under this chapter as a homeowner based on each
tenant's share of property taxes. The tenant may not deleted text begin include any rent constituting property
taxes paid on that unit deleted text end new text begin claim the renter's credit under section 290.0693 new text end . For the purposes of
this section, a leasehold cooperative is formed on the day that leasehold cooperative status
is granted by the appropriate county official.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 17.

Minnesota Statutes 2022, section 290A.13, is amended to read:

290A.13 NO RELIEF ALLOWED IN CERTAIN CASES.

No claim for relief under this chapter shall be allowed if the commissioner determines
that the claimant received title deleted text begin or tenancy deleted text end to the homestead primarily for the purpose of
receiving benefits under this chapter and not for bona fide residence purposes.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 18.

Minnesota Statutes 2022, section 290A.19, is amended to read:

290A.19 OWNER OR MANAGING AGENT TO FURNISH RENT CERTIFICATE.

(a) The new text begin park new text end owner deleted text begin or managing agent of any deleted text end new text begin of a new text end property for which rent is paid for
occupancy as a homestead must furnish a certificate of rent paid to a person who is a renter
on December 31, in the form prescribed by the commissioner. If the renter moves before
December 31, the new text begin park new text end owner deleted text begin or managing agent deleted text end may give the certificate to the renter at
the time of moving, or mail the certificate to the forwarding address if an address has been
provided by the renter. The certificate must be made available to the renter before February
1 of the year following the year in which the rent was paid. The new text begin park new text end owner deleted text begin or managing
agent deleted text end must retain a duplicate of each certificate or an equivalent record showing the same
information for a period of three years. The duplicate or other record must be made available
to the commissioner upon request.

(b) The commissioner may require the new text begin park new text end owner deleted text begin or managing agent deleted text end , through a simple
process, to furnish to the commissioner on or before March 1 a copy of each certificate of
rent paid furnished to a renter for rent paid in the prior year. The commissioner shall prescribe
the content, format, and manner of the form pursuant to section 270C.30. new text begin The commissioner
may require the Social Security number, individual taxpayer identification number, federal
employer identification number, or Minnesota taxpayer identification number of the park
owner who is required to furnish a certificate of rent paid under this paragraph. new text end Prior to
implementation, the commissioner, after consulting with representatives of new text begin park new text end owners deleted text begin or
managing agents deleted text end , shall develop an implementation and administration plan for the
requirements of this paragraph that attempts to minimize financial burdens, administration
and compliance costs, and takes into consideration existing systems of new text begin park new text end owners deleted text begin and
managing agents deleted text end .

(c) For the purposes of this section, deleted text begin "owner" includes deleted text end new text begin "park owner" means new text end a park owner
as defined under section 327C.015, subdivision 9, and "property" includes a lot as defined
under section 327C.015, subdivision 6.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 19.

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 and Social Security numbers of persons who have applied for both
homestead classification under section 273.13 and a deleted text begin property tax refund as a renter under
this chapter deleted text end new text begin renter's credit under section 290.0693 new text end .

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 claims based on rent paid in 2023
and following years.
new text end

Sec. 20.

Minnesota Statutes 2022, section 462A.05, subdivision 24, is amended to read:

Subd. 24.

Housing for elderly, persons with physical or developmental disabilities,
and single parent families.

(a) It may engage in housing programs for low- and
moderate-income elderly, persons with physical or developmental disabilities, or single
parent families in the case of home sharing programs, as defined by the agency, to provide
grants or loans, with or without interest, for:

(1) accessibility improvements to residences occupied by elderly persons;

(2) housing sponsors, as defined by the agency, of home sharing programs to match
existing homeowners with prospective tenants who will contribute either rent or services
to the homeowner, where either the homeowner or the prospective tenant is elderly, a person
with physical or developmental disabilities, or the head of a single parent family;

(3) the construction of or conversion of existing buildings into structures for occupancy
by the elderly that contain from three to 12 private sleeping rooms with shared cooking
facilities and common space; and

(4) housing sponsors, as defined by the agency, to demonstrate the potential for home
equity conversion in Minnesota for the elderly, in both rural and urban areas, and to determine
the need in those equity conversions for consumer safeguards.

(b) In making the grants or loans, the agency shall determine the terms and conditions
of repayment and the appropriate security, if any, should repayment be required. The agency
may provide technical assistance to sponsors of home sharing programs or may contract or
delegate the provision of the technical assistance in accordance with section 462A.07,
subdivision 12.

(c) Housing sponsors who receive funding through these programs shall provide
homeowners and tenants participating in a home sharing program with information regarding
their rights and obligations as they relate to federal and state tax law including, but not
limited to, taxable rental income, homestead classification under chapter 273, new text begin the renter's
credit under section 290.0693, new text end and the property tax refund act under chapter 290A.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

Sec. 21. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2022, sections 290A.03, subdivisions 9 and 11; 290A.04, subdivisions
2a and 5; and 290A.23, subdivision 1, new text end new text begin are repealed.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims based on rent paid in 2023
and following years.
new text end

APPENDIX

Repealed Minnesota Statutes: 23-02685

290A.03 DEFINITIONS.

Subd. 9.

Disabled claimant.

"Disabled claimant" means any claimant who has a disability.

Subd. 11.

Rent constituting property taxes.

"Rent constituting property taxes" means 17 percent of the gross rent actually paid in cash, or its equivalent, or the portion of rent paid in lieu of property taxes, in any calendar year by a claimant for the right of occupancy of the claimant's Minnesota homestead in the calendar year, and which rent constitutes the basis, in the succeeding calendar year of a claim for relief under this chapter by the claimant.

290A.04 REFUND ALLOWABLE.

Subd. 2a.

Renters.

A claimant whose rent constituting property taxes exceeds the percentage of the household income stated below must pay an amount equal to the percent of income shown for the appropriate household income level along with the percent to be paid by the claimant of the remaining amount of rent constituting property taxes. The state refund equals the amount of rent constituting property taxes that remain, up to the maximum state refund amount shown below.

Household Income	Percent of Income	Percent Paid byClaimant	Maximum StateRefund
$0 to 5,269	1.0 percent	5 percent	$	2,150
5,270 to 6,999	1.0 percent	10 percent	$	2,150
7,000 to 8,749	1.1 percent	10 percent	$	2,090
8,750 to 12,269	1.2 percent	10 percent	$	2,040
12,270 to 15,779	1.3 percent	15 percent	$	1,980
15,780 to 17,519	1.4 percent	15 percent	$	1,930
17,520 to 19,259	1.4 percent	20 percent	$	1,880
19,260 to 22,779	1.5 percent	20 percent	$	1,820
22,780 to 24,529	1.6 percent	20 percent	$	1,770
24,530 to 26,279	1.7 percent	25 percent	$	1,770
26,280 to 29,789	1.8 percent	25 percent	$	1,770
29,790 to 31,529	1.9 percent	30 percent	$	1,770
31,530 to 36,789	2.0 percent	30 percent	$	1,770
36,790 to 42,039	2.0 percent	35 percent	$	1,770
42,040 to 49,059	2.0 percent	40 percent	$	1,770
49,060 to 50,799	2.0 percent	45 percent	$	1,610
50,800 to 52,559	2.0 percent	45 percent	$	1,450
52,560 to 54,319	2.0 percent	45 percent	$	1,230
54,320 to 56,059	2.0 percent	50 percent	$	1,070
56,060 to 57,819	2.0 percent	50 percent	$	970
57,820 to 59,569	2.0 percent	50 percent	$	540
59,570 to 61,319	2.0 percent	50 percent	$	210

The payment made to a claimant is the amount of the state refund calculated under this subdivision. No payment is allowed if the claimant's household income is $61,320 or more.

Subd. 5.

Combined renter and homeowner refund.

In the case of a claimant who is entitled to a refund in a calendar year for claims based both on rent constituting property taxes and property taxes payable, the refund allowable equals the sum of the refunds allowable.

290A.23 APPROPRIATION.

Subdivision 1.

Renters credit.

There is appropriated from the general fund in the state treasury to the commissioner of revenue the amount necessary to make the payments required under section 290A.04, subdivision 2a.