SF 1526

as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to taxation; providing for homestead 
  1.3             treatment to certain residents owning residential real 
  1.4             estate and occupying it for only a part of the year; 
  1.5             amending Minnesota Statutes 1996, section 273.124, 
  1.6             subdivisions 1 and 13. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1996, section 273.124, 
  1.9   subdivision 1, is amended to read: 
  1.10     Subdivision 1.  [GENERAL RULE.] (a) Residential real estate 
  1.11  that is occupied and used for the purposes of a homestead by its 
  1.12  owner, who must be a Minnesota resident, is a residential 
  1.13  homestead.  
  1.14     Agricultural land, as defined in section 273.13, 
  1.15  subdivision 23, that is occupied and used as a homestead by its 
  1.16  owner, who must be a Minnesota resident, is an agricultural 
  1.17  homestead. 
  1.18     Dates for establishment of a homestead and homestead 
  1.19  treatment provided to particular types of property are as 
  1.20  provided in this section.  
  1.21     Property of a trustee, beneficiary, or grantor of a trust 
  1.22  is not disqualified from receiving homestead benefits if the 
  1.23  homestead requirements under this chapter are satisfied. 
  1.24     The assessor shall require proof, as provided in 
  1.25  subdivision 13, of the facts upon which classification as a 
  1.26  homestead may be determined.  Notwithstanding any other law, the 
  2.1   assessor may at any time require a homestead application to be 
  2.2   filed in order to verify that any property classified as a 
  2.3   homestead continues to be eligible for homestead status.  
  2.4   Notwithstanding any other law to the contrary, the department of 
  2.5   revenue may, upon request from an assessor, verify whether an 
  2.6   individual who is requesting or receiving homestead 
  2.7   classification has filed a Minnesota income tax return as a 
  2.8   resident for the most recent taxable year for which the 
  2.9   information is available. 
  2.10     When there is a name change or a transfer of homestead 
  2.11  property, the assessor may reclassify the property in the next 
  2.12  assessment unless a homestead application is filed to verify 
  2.13  that the property continues to qualify for homestead 
  2.14  classification. 
  2.15     (b) For purposes of this section, homestead property shall 
  2.16  include property which is used for purposes of the homestead but 
  2.17  is separated from the homestead by a road, street, lot, 
  2.18  waterway, or other similar intervening property.  The term "used 
  2.19  for purposes of the homestead" shall include but not be limited 
  2.20  to uses for gardens, garages, or other outbuildings commonly 
  2.21  associated with a homestead, but shall not include vacant land 
  2.22  held primarily for future development.  In order to receive 
  2.23  homestead treatment for the noncontiguous property, the owner 
  2.24  shall apply for it to the assessor by July 1 of the year when 
  2.25  the treatment is initially sought.  After initial qualification 
  2.26  for the homestead treatment, additional applications for 
  2.27  subsequent years are not required. 
  2.28     (c) Residential real estate that is occupied and used for 
  2.29  purposes of a homestead by a relative of the owner is a 
  2.30  homestead but only to the extent of the homestead treatment that 
  2.31  would be provided if the related owner occupied the property.  
  2.32  For purposes of this paragraph and paragraph (f), "relative" 
  2.33  means a parent, stepparent, child, stepchild, grandparent, 
  2.34  grandchild, brother, sister, uncle, or aunt.  This relationship 
  2.35  may be by blood or marriage.  Property that has been classified 
  2.36  as seasonal recreational residential property at any time during 
  3.1   which it has been owned by the current owner or spouse of the 
  3.2   current owner will not be reclassified as a homestead unless it 
  3.3   is occupied as a homestead by the owner; this prohibition also 
  3.4   applies to property that, in the absence of this paragraph, 
  3.5   would have been classified as seasonal recreational residential 
  3.6   property at the time when the residence was constructed.  
  3.7   Neither the related occupant nor the owner of the property may 
  3.8   claim a property tax refund under chapter 290A for a homestead 
  3.9   occupied by a relative.  In the case of a residence located on 
  3.10  agricultural land, only the house, garage, and immediately 
  3.11  surrounding one acre of land shall be classified as a homestead 
  3.12  under this paragraph, except as provided in paragraph (d). 
  3.13     (d) Agricultural property that is occupied and used for 
  3.14  purposes of a homestead by a relative of the owner, is a 
  3.15  homestead, only to the extent of the homestead treatment that 
  3.16  would be provided if the related owner occupied the property, 
  3.17  and only if all of the following criteria are met: 
  3.18     (1) the relative who is occupying the agricultural property 
  3.19  is a son, daughter, father, or mother of the owner of the 
  3.20  agricultural property or a son or daughter of the spouse of the 
  3.21  owner of the agricultural property, 
  3.22     (2) the owner of the agricultural property must be a 
  3.23  Minnesota resident, 
  3.24     (3) the owner of the agricultural property must not receive 
  3.25  homestead treatment on any other agricultural property in 
  3.26  Minnesota, and 
  3.27     (4) the owner of the agricultural property is limited to 
  3.28  only one agricultural homestead per family under this paragraph. 
  3.29     Neither the related occupant nor the owner of the property 
  3.30  may claim a property tax refund under chapter 290A for a 
  3.31  homestead occupied by a relative qualifying under this 
  3.32  paragraph.  For purposes of this paragraph, "agricultural 
  3.33  property" means the house, garage, other farm buildings and 
  3.34  structures, and agricultural land. 
  3.35     Application must be made to the assessor by the owner of 
  3.36  the agricultural property to receive homestead benefits under 
  4.1   this paragraph.  The assessor may require the necessary proof 
  4.2   that the requirements under this paragraph have been met. 
  4.3      (e) In the case of property owned by a property owner who 
  4.4   is married, the assessor must not deny homestead treatment in 
  4.5   whole or in part if only one of the spouses occupies the 
  4.6   property and the other spouse is absent due to:  (1) marriage 
  4.7   dissolution proceedings, (2) legal separation, (3) employment or 
  4.8   self-employment in another location, (4) residence in a nursing 
  4.9   home or boarding care facility, or (5) other personal 
  4.10  circumstances causing the spouses to live separately, not 
  4.11  including an intent to obtain two homestead classifications for 
  4.12  property tax purposes.  To qualify under clause (3), the 
  4.13  spouse's place of employment or self-employment must be at least 
  4.14  50 miles distant from the other spouse's place of employment, 
  4.15  and the homesteads must be at least 50 miles distant from each 
  4.16  other.  Homestead treatment, in whole or in part, shall not be 
  4.17  denied to the owner's spouse who previously occupied the 
  4.18  residence with the owner if the absence of the owner is due to 
  4.19  one of the exceptions provided in this paragraph. 
  4.20     (f) If an individual is purchasing property with the intent 
  4.21  of claiming it as a homestead and is required by the terms of 
  4.22  the financing agreement to have a relative shown on the deed as 
  4.23  a coowner, the assessor shall allow a full homestead 
  4.24  classification.  This provision only applies to first-time 
  4.25  purchasers, whether married or single, or to a person who had 
  4.26  previously been married and is purchasing as a single individual 
  4.27  for the first time.  The application for homestead benefits must 
  4.28  be on a form prescribed by the commissioner and must contain the 
  4.29  data necessary for the assessor to determine if full homestead 
  4.30  benefits are warranted. 
  4.31     (g) A Minnesota resident who owns and occupies residential 
  4.32  real estate, including noncommercial seasonal recreational 
  4.33  property, for only a part of the year shall receive homestead 
  4.34  classification under this subdivision if the resident and the 
  4.35  resident's spouse do not claim or receive homestead treatment or 
  4.36  relative homestead treatment on any other property located in 
  5.1   the state.  The provisions of paragraph (e) do not apply to 
  5.2   property receiving homestead treatment under this paragraph. 
  5.3      Sec. 2.  Minnesota Statutes 1996, section 273.124, 
  5.4   subdivision 13, is amended to read: 
  5.5      Subd. 13.  [HOMESTEAD APPLICATION.] (a) A person who meets 
  5.6   the homestead requirements under subdivision 1 must file a 
  5.7   homestead application with the county assessor to initially 
  5.8   obtain homestead classification. 
  5.9      (b) On or before January 2, 1993, each county assessor 
  5.10  shall mail a homestead application to the owner of each parcel 
  5.11  of property within the county which was classified as homestead 
  5.12  for the 1992 assessment year.  The format and contents of a 
  5.13  uniform homestead application shall be prescribed by the 
  5.14  commissioner of revenue.  The commissioner shall consult with 
  5.15  the chairs of the house and senate tax committees on the 
  5.16  contents of the homestead application form.  The application 
  5.17  must clearly inform the taxpayer that this application must be 
  5.18  signed by all owners who occupy the property or by the 
  5.19  qualifying relative and returned to the county assessor in order 
  5.20  for the property to continue receiving homestead treatment.  The 
  5.21  envelope containing the homestead application shall clearly 
  5.22  identify its contents and alert the taxpayer of its necessary 
  5.23  immediate response. 
  5.24     (c) Every property owner applying for homestead 
  5.25  classification must furnish to the county assessor the social 
  5.26  security number of each occupant who is listed as an owner of 
  5.27  the property on the deed of record, the name and address of each 
  5.28  owner who does not occupy the property, and the name and social 
  5.29  security number of each owner's spouse who occupies the 
  5.30  property.  The application must be signed by each owner who 
  5.31  occupies the property and by each owner's spouse who occupies 
  5.32  the property, or, in the case of property that qualifies as a 
  5.33  homestead under subdivision 1, paragraph (c), by the qualifying 
  5.34  relative. 
  5.35     If a property owner occupies a homestead, the property 
  5.36  owner's spouse may not claim another property as a homestead 
  6.1   unless the property owner and the property owner's spouse file 
  6.2   with the assessor an affidavit or other proof required by the 
  6.3   assessor stating that the property qualifies as a homestead 
  6.4   under subdivision 1, paragraph (e). 
  6.5      Owners or spouses occupying residences owned by their 
  6.6   spouses and previously occupied with the other spouse, either of 
  6.7   whom fail to include the other spouse's name and social security 
  6.8   number on the homestead application or provide the affidavits or 
  6.9   other proof requested, will be deemed to have elected to receive 
  6.10  only partial homestead treatment of their residence.  The 
  6.11  remainder of the residence will be classified as nonhomestead 
  6.12  residential.  When an owner or spouse's name and social security 
  6.13  number appear on homestead applications for two separate 
  6.14  residences and only one application is signed, the owner or 
  6.15  spouse will be deemed to have elected to homestead the residence 
  6.16  for which the application was signed. 
  6.17     The social security numbers or affidavits or other proofs 
  6.18  of the property owners and spouses are private data on 
  6.19  individuals as defined by section 13.02, subdivision 12, but, 
  6.20  notwithstanding that section, the private data may be disclosed 
  6.21  to the commissioner of revenue, or, for purposes of proceeding 
  6.22  under the revenue recapture act to recover personal property 
  6.23  taxes owing, to the county treasurer. 
  6.24     (d) If residential real estate is occupied and used for 
  6.25  purposes of a homestead by a relative of the owner and qualifies 
  6.26  for a homestead under subdivision 1, paragraph (c), in order for 
  6.27  the property to receive homestead status, a homestead 
  6.28  application must be filed with the assessor.  The social 
  6.29  security number of each relative occupying the property and the 
  6.30  social security number of each owner who is related to an 
  6.31  occupant of the property shall be required on the homestead 
  6.32  application filed under this subdivision.  If a different 
  6.33  relative of the owner subsequently occupies the property, the 
  6.34  owner of the property must notify the assessor within 30 days of 
  6.35  the change in occupancy.  The social security number of a 
  6.36  relative occupying the property is private data on individuals 
  7.1   as defined by section 13.02, subdivision 12, but may be 
  7.2   disclosed to the commissioner of revenue.  
  7.3      (e) The homestead application shall also notify the 
  7.4   property owners that the application filed under this section 
  7.5   will not be mailed annually and that if the property is granted 
  7.6   homestead status for the 1993 assessment, or any assessment year 
  7.7   thereafter, that same property shall remain classified as 
  7.8   homestead until the property is sold or transferred to another 
  7.9   person, or the owners, the spouse of the owner, or the relatives 
  7.10  no longer use the property as their homestead.  Upon the sale or 
  7.11  transfer of the homestead property, a certificate of value must 
  7.12  be timely filed with the county auditor as provided under 
  7.13  section 272.115.  Failure to notify the assessor within 30 days 
  7.14  that the property has been sold, transferred, or that the owner, 
  7.15  the spouse of the owner, or the relative is no longer occupying 
  7.16  the property as a homestead, shall result in the penalty 
  7.17  provided under this subdivision and the property will lose its 
  7.18  current homestead status. 
  7.19     (f) If the homestead application is not returned within 30 
  7.20  days, the county will send a second application to the present 
  7.21  owners of record.  The notice of proposed property taxes 
  7.22  prepared under section 275.065, subdivision 3, shall reflect the 
  7.23  property's classification.  Beginning with assessment year 1993 
  7.24  for all properties, if a homestead application has not been 
  7.25  filed with the county by December 15, the assessor shall 
  7.26  classify the property as nonhomestead for the current assessment 
  7.27  year for taxes payable in the following year, provided that the 
  7.28  owner may be entitled to receive the homestead classification by 
  7.29  proper application under section 375.192. 
  7.30     (g) At the request of the commissioner, each county must 
  7.31  give the commissioner a list that includes the name and social 
  7.32  security number of each property owner and the property owner's 
  7.33  spouse occupying the property, or relative of a property owner, 
  7.34  applying for homestead classification under this subdivision.  
  7.35  The commissioner shall use the information provided on the lists 
  7.36  as appropriate under the law, including for the detection of 
  8.1   improper claims by owners, or relatives of owners, under chapter 
  8.2   290A.  
  8.3      (h) If the commissioner finds that a property owner may be 
  8.4   claiming a fraudulent homestead, the commissioner shall notify 
  8.5   the appropriate counties.  Within 90 days of the notification, 
  8.6   the county assessor shall investigate to determine if the 
  8.7   homestead classification was properly claimed.  If the property 
  8.8   owner does not qualify, the county assessor shall notify the 
  8.9   county auditor who will determine the amount of homestead 
  8.10  benefits that had been improperly allowed.  For the purpose of 
  8.11  this section, "homestead benefits" means the tax reduction 
  8.12  resulting from the classification as a homestead under section 
  8.13  273.13, the taconite homestead credit under section 273.135, and 
  8.14  the supplemental homestead credit under section 273.1391. 
  8.15     The county auditor shall send a notice to the person who 
  8.16  owned the affected property at the time the homestead 
  8.17  application related to the improper homestead was filed, 
  8.18  demanding reimbursement of the homestead benefits plus a penalty 
  8.19  equal to 100 percent of the homestead benefits.  The person 
  8.20  notified may appeal the county's determination by serving copies 
  8.21  of a petition for review with county officials as provided in 
  8.22  section 278.01 and filing proof of service as provided in 
  8.23  section 278.01 with the Minnesota tax court within 60 days of 
  8.24  the date of the notice from the county.  Procedurally, the 
  8.25  appeal is governed by the provisions in chapter 271 which apply 
  8.26  to the appeal of a property tax assessment or levy, but without 
  8.27  requiring any prepayment of the amount in controversy.  If the 
  8.28  amount of homestead benefits and penalty is not paid within 60 
  8.29  days, and if no appeal has been filed, the county auditor shall 
  8.30  certify the amount of taxes and penalty to the county 
  8.31  treasurer.  The county treasurer will add interest to the unpaid 
  8.32  homestead benefits and penalty amounts at the rate provided for 
  8.33  delinquent personal property taxes for the period beginning 60 
  8.34  days after demand for payment was made until payment.  If the 
  8.35  person notified is the current owner of the property, the 
  8.36  treasurer may add the total amount of benefits, penalty, 
  9.1   interest, and costs to the real estate taxes otherwise payable 
  9.2   on the property in the following year.  If the person notified 
  9.3   is not the current owner of the property, the treasurer may 
  9.4   collect the amounts due under the revenue recapture act in 
  9.5   chapter 270A, or use any of the powers granted in sections 
  9.6   277.20 and 277.21 without exclusion, to enforce payment of the 
  9.7   benefits, penalty, interest, and costs, as if those amounts were 
  9.8   delinquent tax obligations of the person who owned the property 
  9.9   at the time the application related to the improperly allowed 
  9.10  homestead was filed.  The treasurer may relieve a prior owner of 
  9.11  personal liability for the benefits, penalty, interest, and 
  9.12  costs, and instead extend those amounts on the tax lists against 
  9.13  the property for taxes payable in the following year to the 
  9.14  extent that the current owner agrees in writing. 
  9.15     (i) Any amount of homestead benefits recovered by the 
  9.16  county from the property owner shall be distributed to the 
  9.17  county, city or town, and school district where the property is 
  9.18  located in the same proportion that each taxing district's levy 
  9.19  was to the total of the three taxing districts' levy for the 
  9.20  current year.  Any amount recovered attributable to taconite 
  9.21  homestead credit shall be transmitted to the St. Louis county 
  9.22  auditor to be deposited in the taconite property tax relief 
  9.23  account.  Any amount recovered that is attributable to 
  9.24  supplemental homestead credit is to be transmitted to the 
  9.25  commissioner of revenue for deposit in the general fund of the 
  9.26  state treasury.  The total amount of penalty collected must be 
  9.27  deposited in the county general fund. 
  9.28     (j) If a property owner has applied for more than one 
  9.29  homestead and the county assessors cannot determine which 
  9.30  property should be classified as homestead, the county assessors 
  9.31  will refer the information to the commissioner.  The 
  9.32  commissioner shall make the determination and notify the 
  9.33  counties within 60 days. 
  9.34     (k) In addition to lists of homestead properties, the 
  9.35  commissioner may ask the counties to furnish lists of all 
  9.36  properties and the record owners. 
 10.1      (l) If residential real estate occupied and used for 
 10.2   purposes of a homestead by the owner for only part of the year 
 10.3   qualifies for homestead treatment under subdivision 1, paragraph 
 10.4   (g), in order for the property to receive homestead status, a 
 10.5   homestead application must be filed with the assessor.  The 
 10.6   application must contain the information required in this 
 10.7   subdivision and any other information required by the assessor.  
 10.8   The fraudulent homestead procedures and penalties under 
 10.9   paragraph (h) apply to homestead treatment improperly claimed by 
 10.10  a property owner under this paragraph. 
 10.11     Sec. 3.  [EFFECTIVE DATE.] 
 10.12     Sections 1 and 2 are effective for taxes levied in 1997, 
 10.13  payable in 1998, and thereafter.