HF 567

as introduced - 91st Legislature (2019 - 2020) Posted on 01/31/2019 02:24pm

A bill for an act
relating to taxation; property; modifying provisions related to agricultural historical
society property, certain property owned by Indian tribes, the disabled veteran
homestead exclusion, and the senior citizens' property tax deferral program;
appropriating money; amending Minnesota Statutes 2018, sections 272.02,
subdivision 49, by adding a subdivision; 273.13, subdivision 34; 290B.04,
subdivision 1.

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

Section 1.

Minnesota Statutes 2018, section 272.02, subdivision 49, is amended to read:

Subd. 49.

Agricultural historical society property.

Property is exempt from taxation
if it is owned by a nonprofit charitable or educational organization that qualifies for
exemption under section 501(c)(3) of the Internal Revenue Code and meets the following
criteria:

(1) the property is primarily used for storing and exhibiting tools, equipment, and artifacts
useful in providing an understanding of local or regional agricultural history. Primary use
is determined each year based on the number of days the property is used solely for storage
and exhibition purposes;

(2) the property is limited to a maximum of deleted text begin 20 deleted text end new text begin 40 new text end acres per owner per county, but
includes the land and any taxable structures, fixtures, and equipment on the land;

(3) the property is not used for a revenue-producing activity for more than ten days in
each calendar year; and

(4) the property is not used for residential purposes on either a temporary or permanent
basis.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for assessments beginning in 2019.
new text end

Sec. 2.

Minnesota Statutes 2018, section 272.02, is amended by adding a subdivision to
read:

new text begin Subd. 102. new text end

new text begin Certain property owned by an Indian tribe. new text end

new text begin (a) Property is exempt that:
new text end

new text begin (1) is located in a city of the first class with a population of more than 380,000 as of the
2010 federal census;
new text end

new text begin (2) was on January 1, 2016, and is for the current assessment, owned by a federally
recognized Indian tribe, or its instrumentality, that is located within the state of Minnesota;
and
new text end

new text begin (3) is used exclusively as a pharmacy.
new text end

new text begin (b) Property that qualifies for the exemption under this subdivision is limited to parcels
and structures that do not exceed, in the aggregate, 4,000 square feet. Property acquired for
single-family housing, market-rate apartments, agriculture, or forestry does not qualify for
this exemption. The exemption created by this subdivision expires with taxes payable in
2028.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2020
and thereafter.
new text end

Sec. 3.

Minnesota Statutes 2018, section 273.13, subdivision 34, is amended to read:

Subd. 34.

Homestead of disabled veteran or family caregiver.

(a) All or a portion of
the market value of property owned by a veteran and serving as the veteran's homestead
under this section is excluded in determining the property's taxable market value if the
veteran has a service-connected disability of 70 percent or more as certified by the United
States Department of Veterans Affairs. To qualify for exclusion under this subdivision, the
veteran must have been honorably discharged from the United States armed forces, as
indicated by United States Government Form DD214 or other official military discharge
papers.

(b)(1) For a disability rating of 70 percent or more, $150,000 of market value is excluded,
except as provided in clause (2); and

(2) for a total (100 percent) and permanent disability, $300,000 of market value is
excluded.

(c) If a disabled veteran qualifying for a valuation exclusion under paragraph (b), clause
(2), predeceases the veteran's spouse, and if upon the death of the veteran the spouse holds
the legal or beneficial title to the homestead and permanently resides there, the exclusion
shall carry over to the benefit of the veteran's spouse for the current taxes payable year and
for eight additional taxes payable years or until such time as the spouse remarries, or sells,
transfers, or otherwise disposes of the property, whichever comes first. Qualification under
this paragraph requires an application under paragraph (h), and a spouse must notify the
assessor if there is a change in the spouse's marital status, ownership of the property, or use
of the property as a permanent residence.

(d) If the spouse of a member of any branch or unit of the United States armed forces
who dies due to a service-connected cause while serving honorably in active service, as
indicated on United States Government Form DD1300 or DD2064, holds the legal or
beneficial title to a homestead and permanently resides there, the spouse is entitled to the
benefit described in paragraph (b), clause (2), for eight taxes payable years, or until such
time as the spouse remarries or sells, transfers, or otherwise disposes of the property,
whichever comes first.

(e) If a veteran meets the disability criteria of paragraph (a) but does not own property
classified as homestead in the state of Minnesota, then the homestead of the veteran's primary
family caregiver, if any, is eligible for the exclusion that the veteran would otherwise qualify
for under paragraph (b).

(f) In the case of an agricultural homestead, only the portion of the property consisting
of the house and garage and immediately surrounding one acre of land qualifies for the
valuation exclusion under this subdivision.

(g) A property qualifying for a valuation exclusion under this subdivision is not eligible
for the market value exclusion under subdivision 35, or classification under subdivision 22,
paragraph (b).

(h) To qualify for a valuation exclusion under this subdivision a property owner must
apply to the assessor by deleted text begin July 1 deleted text end new text begin December 15 new text end of the first assessment year for which the
exclusion is sought. For an application received after deleted text begin July 1 deleted text end new text begin December 15 new text end , the exclusion
shall become effective for the following assessment year. Except as provided in paragraph
(c), the owner of a property that has been accepted for a valuation exclusion must notify
the assessor if there is a change in ownership of the property or in the use of the property
as a homestead.

(i) A first-time application by a qualifying spouse for the market value exclusion under
paragraph (d) must be made any time within two years of the death of the service member.

(j) For purposes of this subdivision:

(1) "active service" has the meaning given in section 190.05;

(2) "own" means that the person's name is present as an owner on the property deed;

(3) "primary family caregiver" means a person who is approved by the secretary of the
United States Department of Veterans Affairs for assistance as the primary provider of
personal care services for an eligible veteran under the Program of Comprehensive Assistance
for Family Caregivers, codified as United States Code, title 38, section 1720G; and

(4) "veteran" has the meaning given the term in section 197.447.

(k) If a veteran dying after December 31, 2011, did not apply for or receive the exclusion
under paragraph (b), clause (2), before dying, the veteran's spouse is entitled to the benefit
under paragraph (b), clause (2), for eight taxes payable years or until the spouse remarries
or sells, transfers, or otherwise disposes of the property if:

(1) the spouse files a first-time application within two years of the death of the service
member or by June 1, 2019, whichever is later;

(2) upon the death of the veteran, the spouse holds the legal or beneficial title to the
homestead and permanently resides there;

(3) the veteran met the honorable discharge requirements of paragraph (a); and

(4) the United States Department of Veterans Affairs certifies that:

(i) the veteran met the total (100 percent) and permanent disability requirement under
paragraph (b), clause (2); or

(ii) the spouse has been awarded dependency and indemnity compensation.

(l) The purpose of this provision of law providing a level of homestead property tax
relief for gravely disabled veterans, their primary family caregivers, and their surviving
spouses is to help ease the burdens of war for those among our state's citizens who bear
those burdens most heavily.

(m) By July 1, the county veterans service officer must certify the disability rating and
permanent address of each veteran receiving the benefit under paragraph (b) to the assessor.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with assessments in 2019, for
taxes payable in 2020.
new text end

Sec. 4.

Minnesota Statutes 2018, section 290B.04, subdivision 1, is amended to read:

Subdivision 1.

Initial application.

(a) A taxpayer meeting the program qualifications
under section 290B.03 may apply to the commissioner of revenue for the deferral of taxes.
Applications are due on or before deleted text begin July deleted text end new text begin November new text end 1 for deferral of any of the following
year's property taxes. new text begin A taxpayer may request an early notification of approval or denial at
any time. The commissioner must notify a taxpayer in writing of the reasons for an
application denial and that the application may be amended and resubmitted by the due date
specified in this subdivision. new text end A taxpayer may apply in the year in which the taxpayer becomes
65 years old, provided that no deferral of property taxes will be made until the calendar
year after the taxpayer becomes 65 years old. The application, which shall be prescribed
by the commissioner of revenue, shall include the following items and any other information
which the commissioner deems necessary:

(1) the name, address, and Social Security number of the owner or owners;

(2) a copy of the property tax statement for the current payable year for the homesteaded
property;

(3) the initial year of ownership and occupancy as a homestead;

(4) the owner's household income for the previous calendar year; and

(5) information on any mortgage loans or other amounts secured by mortgages or other
liens against the property, for which purpose the commissioner may require the applicant
to provide a copy of the mortgage note, the mortgage, or a statement of the balance owing
on the mortgage loan provided by the mortgage holder. The commissioner may require the
appropriate documents in connection with obtaining and confirming information on unpaid
amounts secured by other liens.

The application must state that program participation is voluntary. The application must
also state that the deferred amount depends directly on the applicant's household income,
and that program participation includes authorization for the annual deferred amount, the
cumulative deferral and interest that appear on each year's notice prepared by the county
under subdivision 6, is public data.

The application must state that program participants may claim the property tax refund
based on the full amount of property taxes eligible for the refund, including any deferred
amounts. The application must also state that property tax refunds will be used to offset any
deferral and interest under this program, and that any other amounts subject to revenue
recapture under section 270A.03, subdivision 7, will also be used to offset any deferral and
interest under this program.

(b) As part of the initial application process, the commissioner may require the applicant
to obtain at the applicant's own cost and submit:

(1) if the property is registered property under chapter 508 or 508A, a copy of the original
certificate of title in the possession of the county registrar of titles (sometimes referred to
as "condition of register"); or

(2) if the property is abstract property, a report prepared by a licensed abstracter showing
the last deed and any unsatisfied mortgages, liens, judgments, and state and federal tax lien
notices which were recorded on or after the date of that last deed with respect to the property
or to the applicant.

The certificate or report under clauses (1) and (2) need not include references to any
documents filed or recorded more than 40 years prior to the date of the certification or report.
The certification or report must be as of a date not more than 30 days prior to submission
of the application.

The commissioner may also require the county recorder or county registrar of the county
where the property is located to provide copies of recorded documents related to the applicant
or the property, for which the recorder or registrar shall not charge a fee. The commissioner
may use any information available to determine or verify eligibility under this section. The
household income from the application is private data on individuals as defined in section
13.02, subdivision 12.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with assessments in 2021.
new text end

Sec. 5. new text begin APPROPRIATION.
new text end

new text begin $5,000 in fiscal year 2020 only is appropriated from the general fund to the commissioner
of revenue for a grant of $2,600 to the city of Mazeppa and a grant of $2,400 to Wabasha
County. The grants, which shall be paid by July 20, 2019, may be used for property tax
abatements and other costs incurred by public and private entities as a result of a fire in the
city of Mazeppa on March 11, 2018. This is a onetime appropriation.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end