HF 249

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to taxation; property; extending the special
agricultural homestead to include grandsons and
granddaughters; amending Minnesota Statutes 2004,
section 273.124, subdivision 14.

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

Section 1.

Minnesota Statutes 2004, 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;

(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 consisting of at least 40
acres 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 owner, the owner's spouse, deleted text begin or deleted text end the son or daughter
of the owner or owner's spouse, new text begin or the grandson or granddaughter
of the owner or the owner's spouse, new text end 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;

(2) both the owner of the agricultural property and the
person who is actively farming the agricultural property under
clause (1), are Minnesota residents;

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

(4) neither the owner nor the person actively farming the
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) Real property held by a trustee under a trust is
eligible for agricultural homestead classification under this
paragraph if the qualifications in clause (i) are met, except
that "owner" means the grantor of the trust.

(iii) 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.

(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, LeSueur, 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 consisting of at least 40 acres
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) a shareholder, member, or partner of that entity is
actively farming the agricultural property;

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

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

(4) 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 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 numbers,
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.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for assessment
year 2004 and thereafter, for taxes payable in 2005 and
thereafter.
new text end