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Key: (1) language to be deleted (2) new language

                             CHAPTER 31-H.F.No. 379 
                  An act relating to mortgage registry and deed taxes; 
                  making technical and clarifying changes; defining 
                  terms; amending Minnesota Statutes 1998, sections 
                  287.01; 287.03; 287.04; 287.05; 287.08; 287.10; 
                  287.11; 287.12; 287.13, subdivision 1; 287.21, 
                  subdivision 1; 287.22; 287.23; 287.24; 287.241; 
                  287.29, subdivision 1; 287.30; 287.31; and 287.33; 
                  proposing coding for new law in Minnesota Statutes, 
                  chapter 287; repealing Minnesota Statutes 1998, 
                  sections 287.06; 287.07; 287.09; 287.21, subdivisions 
                  2 and 4; 287.34; 287.35; and 287.36. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 1998, section 287.01, is 
        amended to read: 
           287.01 [DEFINITIONS; MORTGAGE REGISTRY TAX.] 
           Subdivision 1.  [WORDS, TERMS, AND PHRASES.] Unless the 
        language or context clearly indicates that a different meaning 
        is intended, the following words, terms, and phrases, for the 
        purposes of sections 287.01 to 287.12 287.13, shall be 
        given have the meanings subjoined to given them in this 
        section. 
           Subd. 2.  [REAL PROPERTY, REAL ESTATE, AND LAND AMENDMENT.] 
        "Real property," "real estate," and "land," in addition to the 
        meaning thereof contained in chapter 500, include all property a 
        conveyance whereof may be recorded or registered by a county 
        recorder under existing law. "Amendment" means generally a 
        document that alters an existing mortgage without securing a new 
        debt, or increasing the amount of an existing debt; and, that 
        does not, in the case of a multistate mortgage described in 
        section 287.05, subdivision 1, paragraph (b), result in an 
        increased percentage of the real property encumbered by the 
        mortgage being located in this state.  Specifically, a document 
        is considered an amendment to the extent it merely does any one 
        or any combination of the following:  
           (i) extends the time for payment of the unpaid portion of 
        the original debt; 
           (ii) changes the rate of interest applicable to the unpaid 
        portion of the original debt; 
           (iii) adds additional real property as security for the 
        unpaid portion of the original debt; 
           (iv) releases some but not all of the real property serving 
        as security for the unpaid portion of the debt; 
           (v) replaces all the real property serving as security for 
        the unpaid portion of the debt with other real property 
        regardless of value; 
           (vi) replaces a party previously bound by the mortgage with 
        a new party who becomes bound by the same amended mortgage; or 
           (vii) reduces the amount of the debt secured by real 
        property located in this state, or in the case of a multistate 
        mortgage described in section 287.05, subdivision 1, paragraph 
        (b), reduces the percentage of real property encumbered by the 
        mortgage that is located in this state. 
           Subd. 3.  [MORTGAGE DEBT.] "Mortgage" means any instrument, 
        including a decree of marriage dissolution or an instrument made 
        pursuant to it, creating or evidencing a lien of any kind on 
        property, given or taken as security for a debt, notwithstanding 
        such debt may also be secured in part by a lien upon 
        personalty.  "Debt" means the principal amount of an obligation 
        to pay money or to perform or refrain from performing an act 
        that is secured in whole or in part by a mortgage of an interest 
        in real property. 
           Subd. 4.  [DECREE OF MARRIAGE DISSOLUTION.] "Decree of 
        marriage dissolution" includes a summary real estate disposition 
        judgment or an instrument made pursuant to under it. 
           Subd. 5.  [EXTENSION.] "Extension" means any document that 
        alters an existing mortgage by extending the time for repayment 
        without increasing the amount of debt secured by real property 
        that is located in this state. 
           Subd. 6.  [MORTGAGE.] "Mortgage" means any instrument, 
        including a decree of marriage dissolution or an instrument made 
        under it, creating or evidencing a lien of any kind on real 
        property, given by an owner of real property as security for a 
        debt, notwithstanding that the debt may also be secured in part 
        by a lien upon personalty. 
           Subd. 7.  [MULTISTATE MORTGAGE.] "Multistate mortgage" 
        means a mortgage that encumbers real property located both in 
        and outside of this state. 
           Subd. 8.  [PERSON.] "Person" includes any individual, 
        partner, officer, director, firm, partnership, joint venture, 
        limited liability company, association, cooperative, social 
        club, fraternal organization, municipal or private corporation, 
        whether organized for profit or not, estate, trusts, business 
        trusts, receiver, trustee, syndicate, the United States, a 
        state, any political subdivision of a state, or any group or 
        combination acting as a unit, and the plural as well as the 
        singular.  The term includes any agent of any individual or 
        organization enumerated in this subdivision. 
           Subd. 9.  [REAL PROPERTY, REAL ESTATE, AND LAND.] "Real 
        property," "real estate," and "land," have the meaning contained 
        in chapter 500, and include all interests in real property that 
        can be conveyed by a document which may be recorded. 
           Subd. 10.  [RECORD, RECORDED, AND RECORDING.] "Record," 
        "recorded," and "recording" each mean that a document has been 
        delivered to and filed in the office of the county recorder or 
        registrar of titles, whichever office maintains the records for 
        the real property described in the document. 
           Sec. 2.  Minnesota Statutes 1998, section 287.03, is 
        amended to read: 
           287.03 [INSTRUMENTS VALID SECURITY FOR DEBT.] 
           No instrument, other than a decree of marriage dissolution 
        or an instrument made pursuant to it, relating to real estate 
        shall be valid as security for any debt, unless the fact that it 
        is intended and the initial known amount of the debt are 
        expressed in it. 
           Sec. 3.  [287.035] [IMPOSITION OF TAX.] 
           A tax of 23 cents is imposed upon each $100, or fraction 
        thereof, of the debt or portion of a debt that is secured by any 
        recorded mortgage of real property located in this state.  The 
        person liable for the tax is the mortgagee.  The tax is not 
        imposed on the lawful interest amounts that may accrue with 
        respect to a debt. 
           Sec. 4.  Minnesota Statutes 1998, section 287.04, is 
        amended to read: 
           287.04 [EXEMPTIONS.] 
           Subdivision 1.  [GENERALLY.] The tax imposed by section 
        287.035 does not apply to:  
           (a) A decree of marriage dissolution or an instrument made 
        pursuant to it or a.  
           (b) A mortgage given to correct a misdescription of the 
        mortgaged property, or to include. 
           (c) A mortgage or other instrument that adds additional 
        security for the same indebtedness on debt for which a mortgage 
        registration registry tax has been paid, are not subject to the 
        tax imposed by this chapter except as provided in section 
        287.05, subdivision 2, paragraph (b).  
           (d) A contract for the conveyance of any interest in real 
        property, including a contract for deed. 
           (e) A mortgage secured by real property subject to the 
        minerals production tax of sections 298.24 to 298.28. 
           Subd. 2.  [MORTGAGES ON PUBLIC PROPERTY.] No tax is imposed 
        upon (f) The principal amount of bonds or other obligations 
        issued by the St. Paul port authority under its common revenue 
        bond fund if each of the following conditions are met. 
           (a) (1) The bonds or other obligations are secured by a 
        mortgage on property, title to which is held by the political 
        subdivision. 
           (b) (2) The mortgage is recorded or registered after the 
        date of enactment May 19, 1993. 
           (c) (3) The bonds or other obligations are either (i)  
        outstanding on the date of enactment May 19, 1993, or (ii) 
        issued in exchange for or to otherwise refund bonds or other 
        obligations the original series of which were issued before the 
        date of enactment May 19, 1993. 
           (g) Mortgages taken in good faith by persons or 
        corporations whose property is expressly exempted from taxation 
        by section 272.02, subdivision 1, clauses (1) to (7), or 
        mortgagees that are fraternal benefit societies subject to 
        section 64B.24. 
           (h) A mortgage amendment or extension, as defined in 
        section 287.01. 
           Sec. 5.  Minnesota Statutes 1998, section 287.05, is 
        amended to read: 
           287.05 [DETERMINATION OF TAX ON RECORDATION OR 
        REGISTRATION; SUPPLEMENTAL MORTGAGES; REVERSE MORTGAGES IN 
        SPECIAL SITUATIONS.] 
           Subdivision 1.  [TAX IMPOSED REAL PROPERTY OUTSIDE 
        MINNESOTA.] A tax of 23 cents is imposed upon each $100, or 
        fraction thereof, of the principal debt or obligation which is 
        or may be secured by any mortgage of real property situated 
        within the state executed, delivered, and recorded or 
        registered; provided, however, that the tax shall be imposed but 
        once upon any mortgage and extension thereof.  If the mortgage 
        describes real estate situated outside of this state, the tax 
        shall be imposed upon that proportion of the whole debt secured 
        thereby as the value of the real estate therein described 
        situated in this state bears to the value of the whole of the 
        real estate described therein.  The tax imposed by this section 
        shall not apply to a contract for the conveyance of any interest 
        in real estate (a) When a multistate mortgage is intended to 
        secure only a portion of a debt amount recited or referred to in 
        the mortgage, the mortgage may contain the following statement, 
        or its equivalent, on the first page:  "Notwithstanding anything 
        to the contrary herein, enforcement of this mortgage in 
        Minnesota is limited to a debt amount of $....... under chapter 
        287 of Minnesota Statutes."  In such case, the tax shall be 
        imposed based only on the amount of debt so stated to be secured 
        by real property located in this state; and, the effect of the 
        mortgage, or any amendment or extension, as evidence in any 
        court in this state, or as notice for any purpose in this state, 
        shall be limited to the amount contained in the statement and 
        for which the tax has been paid.  
           (b) All multistate mortgages not taxed under paragraph (a) 
        shall be taxed under sections 287.01 to 287.13 as if the real 
        property identified in the mortgage secures payment of that 
        portion of the maximum debt amount referred to, or incorporated 
        by reference, in the mortgage that is equal to a fraction the 
        numerator of which is the value of the real property described 
        in the mortgage that is located in this state and the 
        denominator of which is the value of all the real property 
        described in the mortgage.  
           Subd. 1a.  [REAL PROPERTY IN THIS STATE SECURES PORTION OF 
        DEBT.] (a) When the real property identified in a mortgage is 
        located entirely in this state and is intended to secure only a 
        portion of a debt amount recited or referred to in the mortgage, 
        the mortgage may contain the following statement, or its 
        equivalent, on the first page:  "Notwithstanding anything to the 
        contrary herein, enforcement of this mortgage is limited to a 
        debt amount of $....... under chapter 287 of Minnesota 
        Statutes."  In such case, the tax shall be imposed based only on 
        the amount of debt so stated to be secured by real property; 
        and, the effect of the mortgage, or any amendment or extension, 
        as evidence in any court in this state, or as notice for any 
        purpose in this state, shall be limited to the amount contained 
        in the statement and for which the tax has been paid.  
           (b) All mortgages that are not multistate mortgages and 
        that are not taxed under paragraph (a) shall be taxed under 
        sections 287.01 to 287.13 as if the real property identified in 
        the mortgage secures payment of the maximum debt amount referred 
        to, or incorporated by reference, in the mortgage. 
           Subd. 2.  [SUPPLEMENTAL MORTGAGES.] Except for an amendment 
        or a revision to a reverse mortgage as described under 
        subdivision 6, any supplemental document that alters an existing 
        mortgage, not including revisions to a reverse mortgage as 
        described under subdivision 6, securing a portion or all of the 
        same indebtedness, whether or not additional security is 
        included, by providing for an increase in the amount of debt 
        secured by real property located in this state, or, in the case 
        of a multistate mortgage described in subdivision 1, paragraph 
        (b), an increase in the percentage of Minnesota real estate as 
        compared to the total real estate that is encumbered by the 
        mortgage shall be taxed in the following manner: 
           (a) Any additional indebtedness shall be taxed on the ratio 
        that the value of the real estate therein described in this 
        state bears to the value of the whole of the real estate 
        described therein. based upon the increase in the amount of the 
        debt determined to be secured by real property located in this 
        state under either subdivision 1 or 1a. 
           (b) If there is no additional indebtedness but the 
        percentage of the Minnesota real estate as compared to the total 
        real estate secured by the previous mortgage is increased, the 
        tax shall be recomputed and paid on the remaining indebtedness 
        multiplied by the difference between that percentage of 
        Minnesota real estate included in the supplemental mortgage and 
        that percentage included in any previous mortgage.  
           (c) In the event of both an increase in the indebtedness 
        and a change in the Minnesota percentage of real estate given as 
        security, the tax shall be recomputed on the portion 
        representing new indebtedness in the manner provided in (a) and 
        in the event of an increase in the percentage of Minnesota 
        property included as security, the tax shall be computed on the 
        remaining portion of the indebtedness as provided in (b).  
           Subd. 3.  [REVOLVING LINES OF CREDIT.] When a mortgage, 
        including a reverse mortgage, secures a revolving line of credit 
        under which advances, payments, and readvances may be made from 
        time to time, the tax imposed under subdivision 1 shall section 
        287.035 must be paid on the maximum amount of the line of credit 
        which that may be secured at any one time, as expressed in the 
        mortgage, regardless of the time or amount of advances, 
        payments, or readvances.  
           Subd. 4.  [ADVANCES BY MORTGAGEE.] No tax under subdivision 
        1 section 287.035 shall be paid on the indeterminate 
        amount which that may be advanced by the mortgagee in protection 
        of the mortgaged premises or the mortgage, including taxes, 
        assessments, charges, claims, fines, impositions, and insurance 
        premiums,; the amounts due upon prior or superior mortgages and 
        other prior or superior liens, encumbrances, and interests,; and 
        legal expenses and attorneys' fees.  
           Subd. 5.  [INDETERMINATE AMOUNTS.] When a mortgage secures 
        an indeterminate amount other than those described in 
        subdivision 3, 4, or 6, no tax shall be paid at the time the 
        mortgage is recorded or registered, but the tax must be paid at 
        the time of recording or filing an affidavit or other document 
        stating the amount and time of the actual advance.  
           Subd. 6.  [REVERSE MORTGAGES.] If real property secures a 
        reverse mortgage, the principal debt or obligation to which 
        mortgage registry tax applies is the expected total 
        disbursements or cash equivalent to be made under the terms of 
        the loan.  Interest accruing on the disbursements made is not 
        subject to mortgage registry tax.  In the case of periodic 
        payments made for an indefinite length of time, the expected 
        total disbursements must equal the product of the periodic 
        payment amounts and the number of payments and, if applicable, 
        the amount of cash distribution or its equivalent.  The number 
        of payments must be based upon the life expectancy assumption 
        used in determining the payment amount.  In the case of reverse 
        mortgages made as part of the Housing and Community Development 
        Act of 1987, section 255 of the National Housing Act, and 
        administered by the Department of Housing and Urban Development 
        (HUD), mortgage registry tax must not be assessed on Federal 
        Housing Administration mortgage insurance premiums, monthly 
        lender service fees, or payments to be distributed to the 
        borrower by HUD.  
           Subd. 7.  [MORTGAGES TO SECURE OBLIGATIONS TO BE 
        ISSUED.] If a mortgage is made to a mortgagee in trust to secure 
        the payment of bonds or other obligations yet to be issued, a 
        statement may be incorporated in the mortgage stating the amount 
        of the obligations already issued or yet to be issued, and the 
        tax to be paid on filing the mortgage for recording must be 
        computed upon the amount so stated.  The statement must be 
        binding and conclusive upon all persons claiming through or 
        under the mortgage, and no such obligation issued in excess of 
        the aggregate so fixed is valid for any purpose unless the 
        additional tax is paid and receipted by the proper county 
        treasurer. 
           Subd. 8.  [AMENDMENTS.] An amendment may contain the 
        following statement, or its equivalent, on its first page:  
        "This is a mortgage amendment, as defined in Minnesota Statutes, 
        section 287.01, subdivision 2, and as such it does not secure a 
        new or an increased amount of debt."  In such cases, the 
        document will be treated as a mortgage amendment, as defined in 
        section 287.01, subdivision 2, for all purposes and does not 
        serve to secure a new or an increased amount of debt. 
           Sec. 6.  Minnesota Statutes 1998, section 287.08, is 
        amended to read: 
           287.08 [TAX, HOW PAYABLE; RECEIPTS.] 
           (a) The tax imposed by sections 287.01 to 287.12 shall must 
        be paid to the treasurer of the any county in this state in 
        which the mortgaged land real property or some part thereof is 
        situated located at or before the time of filing the mortgage 
        for record or registration.  The treasurer shall endorse receipt 
        on the mortgage, countersigned by the county auditor, who shall 
        charge the amount to the treasurer and such the receipt shall be 
        recorded with the mortgage, and such receipt of the record 
        thereof shall be is conclusive proof that the tax has been 
        paid to in the amount therein stated and authorize authorizes 
        any county recorder or registrar of titles to record the 
        mortgage.  Its form, in substance, shall be "registration tax 
        hereon of ..................... dollars paid."  If the mortgages 
        be mortgage is exempt from taxation the endorsement shall, in 
        substance, be "exempt from registration tax,."  to In either 
        case the receipt must be signed in either case by the treasurer 
        as such, and in case of payment to be countersigned by the 
        auditor.  In case the treasurer shall be is unable to determine 
        whether a claim of exemption should be allowed, the tax shall 
        must be paid as in the case of a taxable mortgage.  
           (b) Upon written application of the taxpayer, the county 
        treasurer may refund in whole or in part any tax which that has 
        been erroneously paid, or a person having paid a mortgage 
        registry tax amount may seek a refund of such the tax, or other 
        appropriate relief, by bringing an action in tax court in the 
        county in which the tax was paid, within 60 days of the 
        payment.  The action is commenced by the serving of a petition 
        for relief on the county treasurer, and by filing a copy with 
        the court.  The county attorney shall defend the action.  The 
        county treasurer shall notify the treasurer of each county that 
        has or would receive a portion of the tax as paid.  
           (c) If the county treasurer determines a refund should be 
        paid, or if a refund is ordered by the court, the county 
        treasurer of each county that actually received a portion of the 
        tax shall immediately pay a proportionate share of three percent 
        of the refund using any available county funds.  The county 
        treasurer of each county which that received, or would have 
        received, a portion of the tax shall also pay their county's 
        proportionate share of the remaining 97 percent of the 
        court-ordered refund on or before the tenth 20th day of the 
        following month using solely the mortgage registry tax funds 
        that would be paid to the commissioner of revenue on that date 
        under section 287.12.  If the funds on hand under this procedure 
        are insufficient to fully fund 97 percent of the court-ordered 
        refund, the county treasurer of the county in which the action 
        was brought shall file a claim with the commissioner of revenue 
        under section 16A.48 for the remaining portion of 97 percent of 
        the refund, and shall pay over the remaining portion upon 
        receipt of a warrant from the state issued pursuant to the claim.
           (d) When any such mortgage covers real property situate 
        located in more than one county in this state the whole of such 
        total tax shall must be paid to the treasurer of the county 
        where the mortgage is first presented for record or registration 
        recording, and the payment shall must be receipted and 
        countersigned as above provided in paragraph (a).  If the 
        principal debt or obligation secured by such a multiple county 
        mortgage exceeds $1,000,000, the nonstate portion of the tax 
        shall must be divided and paid over by the county treasurer 
        receiving the same it, on or before the tenth 20th day of each 
        month after receipt thereof, to the county or counties 
        entitled thereto in the ratio which that the market value of the 
        real property covered by the mortgage in each county bears to 
        the market value of all the real property in this state 
        described in the mortgage.  In making such the division and 
        payment the county treasurer shall send therewith a statement 
        giving the description of the real property described in the 
        mortgage and the market value of the part thereof situate 
        located in each county.  For the this purpose aforesaid, the 
        treasurer of any county may require the treasurer of any other 
        county to certify to the former the market valuation of any 
        tract of land real property in any such mortgage. 
           Sec. 7.  Minnesota Statutes 1998, section 287.10, is 
        amended to read: 
           287.10 [PREPAYMENT OF TAX; EVIDENCE; NOTICE.] 
           A mortgage or papers documents relating to its foreclosure, 
        assignment, or satisfaction, must not be recorded or registered 
        unless the tax has been paid.  A Except as provided in section 
        582.25, a document or any record of the mortgage may not be 
        received in evidence in any court, and is not valid notice, 
        unless the tax has been paid.  If the tax is paid, an error in 
        computation or ascertainment of the amount does not affect the 
        validity of the mortgage or the record or foreclosure.  This 
        section does not apply to a mortgage that is exempt 
        from taxation the tax imposed under section 287.04 or 287.05, 
        subdivision 1 287.035.  
           Sec. 8.  Minnesota Statutes 1998, section 287.11, is 
        amended to read: 
           287.11 [MORTGAGES RECORDED OR REGISTERED PRIOR TO PASSAGE 
        OF SECTIONS 287.01 TO 287.12.] 
           All mortgages of real estate property recorded or 
        registered prior to the passage of sections 287.01 to 
        287.12 shall be are taxable as provided by law under the 
        provisions of law relating thereto existing prior to the 
        enactment hereof of sections 287.01 to 287.12; provided, that 
        the holder of any such mortgage may pay to the treasurer of the 
        proper county, or the state treasurer, or both, the tax therein 
        prescribed based upon the amount of the debt secured by such the 
        mortgage at the time of such the payment as stated by the 
        affidavit of the owner of such the mortgage, to.  The affidavit 
        may be filed with the county treasurer, and have in which case 
        the treasurer's receipt, countersigned by the auditor, must be 
        endorsed thereon on it.  The county recorder or secretary of 
        state, as the case may be, or registrar of titles on 
        presentation of such the receipt, shall note on the margin of 
        the mortgage make a record of the date and amount of such the 
        payment.  Thereafter such the mortgage debt lien shall not be 
        otherwise taxable. 
           Sec. 9.  Minnesota Statutes 1998, section 287.12, is 
        amended to read: 
           287.12 [TAXES, HOW APPORTIONED.] 
           (a) All taxes paid to the county treasurer under the 
        provisions of sections 287.01 to 287.12 shall must be 
        apportioned, 97 percent to the general fund of the state, and 
        three percent to the county revenue fund. 
           (b) On or before the tenth 20th day of each month the 
        county treasurer shall determine and pay to the commissioner of 
        revenue for deposit in the state treasury and credit to the 
        general fund the state's portion of the receipts from the 
        mortgage registration registry tax during the preceding month 
        subject to the electronic funds transfer requirements of section 
        270.771.  The county treasurer shall provide any related reports 
        requested by the commissioner of revenue. 
           Sec. 10.  Minnesota Statutes 1998, section 287.13, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [FAILURE TO PAY FULL AMOUNT.] Any person 
        liable for the tax imposed by section 287.05 287.035 who fails 
        to pay the full amount of mortgage registry tax imposed under 
        sections 287.01 to 287.12 this chapter, unless such the failure 
        is shown to be due to reasonable cause, is liable for a civil 
        penalty of $250 or 100 percent of the tax for each such failure, 
        whichever is less. 
           Sec. 11.  [287.20] [DEFINITIONS; DEED TAX.] 
           Subdivision 1.  [WORDS, TERMS, AND PHRASES.] Unless the 
        language or context clearly indicates that a different meaning 
        is intended, the following words, terms, and phrases, for the 
        purposes of sections 287.21 to 287.31, have the meanings given 
        to them in this section. 
           Subd. 2.  [CONSIDERATION.] (a) "Consideration" means 
        generally the total monetary value that is given in return for a 
        conveyance of real property in this state and includes all 
        lump-sum payments, all prior or future installment payments that 
        are required under the agreement between the parties, and the 
        fair market value of any property taken, or to be taken, in 
        exchange. 
           (b) Consideration does not include the reasonable and 
        lawful amounts of interest paid for the privilege of paying the 
        purchase price in installments and the fair market value of any 
        items of intangible personal property that are conveyed by the 
        taxable instrument. 
           (c) Consideration does not include the amount paid for the 
        personal property located on the real property being conveyed 
        and transferred as a part of the total consideration, except 
        that the amount paid for the personal property located on the 
        real property being conveyed must be included if the real 
        property being conveyed is a one-, two-, or three-unit 
        residential structure. 
           (d) When a conveyance of real property is made pursuant to 
        a contract for deed, the consideration is the price for the real 
        property reflected in the contract; except that, subject to the 
        limitations under section 287.221, when the conveyance is made 
        by a person engaged in the business of land sales or 
        construction of buildings and other improvements, or by an 
        affiliated person, then the consideration is the amount paid for 
        the land and the improvements.  By January 1, 2001, the 
        commissioner shall adopt rules that define the phrases "engaged 
        in the business of land sales or construction of buildings and 
        other improvements" and "affiliated person" as those phrases are 
        used in this paragraph. 
           (e) "Total consideration" has the same meaning as 
        consideration. 
           (f) "Consideration, exclusive of the value of any lien or 
        encumbrance remaining at the time of sale" or "net 
        consideration" means the amount of consideration as reduced by 
        the amount outstanding under any lien that attached to the real 
        property prior to the time of sale and that is not released or 
        satisfied as a result of the sale. 
           Subd. 3.  [CONSOLIDATION OR MERGER.] "Consolidation" or 
        "merger" means the combination of all of the assets of two or 
        more corporations, limited liability companies, or partnerships, 
        or any combination of these entities, whether or not title to 
        the assets is taken by a newly created entity or by a 
        preexisting entity that survives the consolidation or merger in 
        an altered form. 
           Subd. 4.  [DOCUMENTARY STAMPS.] "Documentary stamps" means 
        all stamps issued by the county for use in payment of the taxes 
        imposed by sections 287.21 to 287.37. 
           Subd. 5.  [LIEN.] "Lien" means any legal claim, other than 
        an easement, created by contract, statute, or law on the real 
        property of another as security for a debt or obligation.  For 
        purposes of the deed tax, the term "encumbrance" is synonymous 
        with the term "lien" and an easement is not a lien.  
           Subd. 6.  [PERSON.] "Person" includes any individual, 
        partner, officer, director, firm, partnership, joint venture, 
        limited liability company, association, cooperative, social 
        club, fraternal organization, municipal or private corporation, 
        whether organized for profit or not, estate, trusts, business 
        trusts, receiver, trustee, syndicate, the United States, a 
        state, any political subdivision of a state, or any group or 
        combination acting as a unit, and the plural as well as the 
        singular.  The term includes directors and officers of 
        corporations, governors and managers of a limited liability 
        company, or members of partnerships who, either individually or 
        jointly with others, have control, supervision, or 
        responsibility of making or authorizing payment of the tax 
        imposed by section 287.21.  The term includes any agent of any 
        individual or organization enumerated in this subdivision. 
           Subd. 7.  [REAL PROPERTY, REAL ESTATE, AND LAND.] "Real 
        property," "real estate," and "land" mean any fee simple estate, 
        and any estate for life, as defined in chapter 500, and the 
        purchaser's interest under a contract for the conveyance of such 
        an estate. 
           Subd. 8.  [RECORD, RECORDED, AND RECORDING.] "Record," 
        "recorded," and "recording" each mean that a document has been 
        delivered to and filed in the office of the county recorder or 
        registrar of titles, whichever office maintains the records for 
        the real property described in the document. 
           Subd. 9.  [REORGANIZATION.] "Reorganization" means the 
        transfer of substantially all of the assets of a corporation, a 
        limited liability company, or a partnership not in the usual or 
        regular course of business. 
           Sec. 12.  Minnesota Statutes 1998, section 287.21, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [DETERMINATION OF TAX.] There (a) A tax is 
        hereby imposed on each deed, or instrument, or writing by which 
        any lands, tenements, or other realty real property in this 
        state shall be is granted, assigned, transferred, or otherwise 
        conveyed, a tax determined in the following manner.  The tax 
        applies against the net consideration. 
           (b) The tax is determined in the following manner:  (1) 
        when transfers are made by instruments pursuant to mergers, 
        consolidations, sales, or transfers of substantially all of the 
        assets of corporations the entities as defined in section 
        287.20, subdivision 9, pursuant to plans of reorganization or, 
        the tax is $1.65; (2) when there is no consideration or when the 
        consideration, exclusive of the value of any lien or encumbrance 
        remaining thereon at the time of sale, is $500 or less, the 
        tax shall be is $1.65.; or (3) when the consideration, exclusive 
        of the value of any lien or encumbrance remaining thereon at the 
        time of sale, exceeds $500, the tax shall be is $1.65 plus $1.65 
        for each additional $500 or fraction of that amount. 
           The tax applies against the total consideration, including 
        the fair market value consideration for any personal property 
        located on the real property conveyed by the deed and 
        transferred as part of the total consideration, but excluding 
        the value of any lien or encumbrance remaining on the property 
        at the time of sale. 
           (c) The tax is due at the time a taxable deed or instrument 
        is presented for recording. 
           Sec. 13.  Minnesota Statutes 1998, section 287.22, is 
        amended to read: 
           287.22 [EXCEPTIONS EXEMPTIONS.] 
           The tax imposed by section 287.21 shall does not apply to: 
           A.  Any (1) An executory contract for the sale of land real 
        property under which the vendee purchaser is entitled to or does 
        take possession thereof of the real property, or any assignment 
        or cancellation thereof. of the contract; 
           B.  Any (2) A mortgage or any an amendment, assignment, 
        extension, partial release, or satisfaction thereof. of a 
        mortgage; 
           C.  Any (3) A will.; 
           D.  Any (4) A plat.; 
           E.  Any (5) A lease., amendment of lease, assignment of 
        lease, or memorandum of lease; 
           F.  Any (6) A deed, instrument, or writing in which the 
        United States or any agency or instrumentality thereof is the 
        grantor, assignor, transferor, conveyor, grantee, or assignee.; 
           G.  Deeds (7) A deed for a cemetery lot or lots.; 
           H.  Deeds (8) A deed of distribution by a personal 
        representatives. representative; 
           I.  Deeds (9) A deed to or from coowners a co-owner 
        partitioning their undivided interests interest in the same 
        piece of real property.; 
           J.  Any (10) A deed or other instrument of conveyance 
        issued pursuant to a permanent school fund land exchange under 
        section 92.121 and related laws.; 
           K.  (11) A referee's or sheriff's certificate of sale in a 
        mortgage or lien foreclosure sale.; 
           L.  (12) A referee's or, sheriff's, or certificate 
        holder's certificate of redemption from a mortgage or lien 
        foreclosure sale issued to the redeeming mortgagor or lienee.; 
           M.  Any (13) A deed, instrument, or writing which grants, 
        creates, modifies, or cancels terminates an easement.; and 
           N.  (14) A decree of marriage dissolution, as defined in 
        section 287.01, subdivision 4, or any a deed or other instrument 
        between the parties to the dissolution made pursuant to the 
        terms of the decree. 
           Sec. 14.  [287.2205] [TAX-FORFEITED LAND.] 
           Before a state deed for tax-forfeited land may be issued, 
        the deed tax must be paid by the purchaser of tax-forfeited land 
        whether the purchase is the result of a public auction or 
        private sale or a repurchase of tax-forfeited land.  State 
        agencies and local units of government that acquire 
        tax-forfeited land by purchase or any other means are subject to 
        this section. 
           Sec. 15.  Minnesota Statutes 1998, section 287.23, is 
        amended to read: 
           287.23 [REAL PROPERTY OUTSIDE COUNTY OR STATE.] 
           Subdivision 1.  [REAL PROPERTY OUTSIDE COUNTY.] If any 
        taxable deed or instrument describes any real property located 
        in more than one county in this state, the total tax must be 
        paid to the treasurer of the county where the document is first 
        presented for recording, and the payment must be receipted as 
        provided in section 287.08.  If the net consideration exceeds 
        $700,000, the nonstate portion of the tax must be divided and 
        paid over by the county treasurer receiving it, on or before the 
        20th day of each month after receipt, to the county or counties 
        entitled in the ratio which the market value of the real 
        property covered by the document in each county bears to the 
        market value of all the real property in this state described in 
        the document.  In making the division and payment the county 
        treasurer shall send a statement to the other involved counties 
        giving the description of the real property described in the 
        document and the market value of the part located in each 
        county.  The treasurer of any county may require the treasurer 
        of any other county to certify to the former the market 
        valuation of any parcel of real property for this purpose. 
           Subd. 2.  [REAL PROPERTY OUTSIDE STATE.] If any deed, or 
        instrument, or writing shall describe describes any real estate 
        situate property located outside of this state, the tax imposed 
        by section 287.21 shall must be measured upon such proportion of 
        the consideration, (exclusive of the value of any lien or 
        encumbrance remaining thereon at the time of sale), as the value 
        of the real estate therein property described situate in this 
        state bears to the value of the whole of the real estate 
        property described therein in the deed or instrument.  
           Sec. 16.  Minnesota Statutes 1998, section 287.24, is 
        amended to read: 
           287.24 [PERSONS LIABLE.] 
           Subdivision 1.  [GENERAL RULE.] Any person who grants, 
        assigns, transfers, or conveys any land, tenement, or realty 
        real property by a deed, writing, or instrument subject to the 
        tax imposed by section 287.21 shall be liable for such tax but 
        no public official shall be liable for a tax with respect to any 
        instrument executed by the official in connection with official 
        duties. 
           Subd. 2.  [OTHER RESPONSIBLE PERSONS.] If an underpayment 
        is assessable by the commissioner of revenue against a grantor 
        pursuant to section 287.37, and the grantor is a business entity 
        no longer in existence, any person who, either individually or 
        jointly with others, had control over, supervision of, or 
        responsibility for making the statement of tax due or exemption 
        from tax that was submitted to the county treasurer under 
        section 287.241, subdivision 1, can be assessed and held liable 
        by the commissioner for the underpayment. 
           Sec. 17.  Minnesota Statutes 1998, section 287.241, is 
        amended to read: 
           287.241 [STATEMENT OF TAX DUE OR EXEMPTION; RECORDING OR 
        REGISTERING OF DOCUMENTS.] 
           Subdivision 1.  [STATEMENT OF TAX DUE OR EXEMPTION.] No 
        deed, or instrument, or writing, taxable under the provisions of 
        section 287.21, shall be recorded or registered by the county 
        recorder or the registrar of titles unless it shall contain 
        contains the statement of the grantor or grantee, or any 
        successor in interest, setting forth the amount of tax due under 
        this chapter or that it is exempt from tax.  The county recorder 
        or registrar of titles shall record or register any such 
        document deed or instrument when the statement sets forth that 
        the transfer is tax exempt, and shall refuse to record or 
        register any such document on which or when documentary stamps 
        in the amount stated thereon have not been affixed or the 
        treasurer's receipt appear for the amount of deed tax recited in 
        the statement.  The validity or effectiveness of an a deed or 
        instrument as between the parties thereto, and as to any person 
        who would otherwise be bound thereby, shall is not be affected 
        by the failure to comply herewith; nor with this section.  If an 
        a deed or instrument is accepted for recording or filing 
        contrary to the provisions hereof this section, shall the 
        failure to comply herewith does not destroy or impair the record 
        thereof of the deed or instrument as notice. 
           Subd. 2.  [NOTICE OF CERTIFICATE OF VALUE.] No deed or 
        instrument providing for the transfer of title to real estate as 
        property that is subject to the tax as provided in section 
        287.21, and no executory contract for the sale of land, shall be 
        recorded in the office of the county recorder or the registrar 
        of titles unless such deed or instrument shall be is accompanied 
        by a notice from the county auditor that a certificate of value 
        was filed in the auditor's office as provided in section 272.115.
           Sec. 18.  Minnesota Statutes 1998, section 287.29, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [APPOINTMENT AND PAYMENT OF TAX PROCEEDS.] 
        (a) The proceeds of the taxes levied and collected under 
        sections 287.21 to 287.36 must be apportioned, 97 percent to the 
        general fund of the state, and three percent to the county 
        revenue fund. 
           (b) On or before the tenth 20th day of each month, the 
        county treasurer shall determine and pay to the commissioner of 
        revenue for deposit in the state treasury and credit to the 
        general fund the state's portion of the receipts for deed tax 
        from the sale of documentary stamps during the preceding month 
        subject to the electronic transfer requirements of section 
        270.771.  The county treasurer shall provide any related reports 
        requested by the commissioner of revenue. 
           Sec. 19.  Minnesota Statutes 1998, section 287.30, is 
        amended to read: 
           287.30 [COUNTY TREASURER; DUTIES.] 
           The care of documentary stamps entrusted to county 
        treasurers and the duties imposed upon county treasurers by 
        sections 287.21 to 287.33 shall be this chapter are within the 
        duties of such office and shall be are within the coverage of 
        any official bond delivered to the state, conditioned that any 
        such officer shall faithfully execute the duties of office.  The 
        county board may by resolution require the county auditor to 
        perform any duty imposed on the county treasurer under this 
        chapter. 
           Sec. 20.  Minnesota Statutes 1998, section 287.31, is 
        amended to read: 
           287.31 [VIOLATIONS; CIVIL PENALTIES.] 
           Subdivision 1.  [FAILURE TO COMPLY PAY FULL AMOUNT.] Any 
        person liable for the tax imposed by section 287.21 who fails to 
        comply with the provisions of section 287.25 pay the full amount 
        of deed tax imposed under this chapter, unless such the failure 
        is shown to be due to reasonable cause, shall be is liable to a 
        civil penalty of $250, or 100 percent of the tax, for each such 
        failure, whichever is less. 
           Subd. 2.  [WILLFUL EVASION.] Any person who willfully 
        attempts in any manner to evade or defeat any such tax or the 
        payment thereof, shall is, in addition to other penalties 
        provided by law, be liable to a penalty of 50 percent of the 
        total amount of the underpayment of the tax.  
           Sec. 21.  [287.325] [VIOLATIONS; CRIMINAL PENALTIES.] 
           Any person who in any manner intentionally attempts to 
        evade a tax imposed by this chapter, or who intentionally aids 
        or abets in the evasion or attempted evasion of such tax is 
        guilty of a gross misdemeanor. 
           Sec. 22.  Minnesota Statutes 1998, section 287.33, is 
        amended to read: 
           287.33 [EXPENSES OF ADMINISTRATION.] 
           Expenses of administration of sections 287.21 to 287.34 
        this chapter to be paid out of county funds include fees and 
        expenses incurred by the county attorney in connection 
        with sections 287.21 to 287.34 this chapter and all other costs 
        and expenses.  
           Sec. 23.  [287.38] [LIMITATIONS ON TIME FOR ASSESSMENT OF 
        TAX.] 
           Subdivision 1.  [GENERAL RULE.] Except as otherwise 
        provided in this section, the amount of taxes assessable under 
        this chapter must be assessed within 3-1/2 years after the date 
        the document is recorded. 
           Subd. 2.  [OMISSION IN EXCESS OF 25 PERCENT.] Additional 
        taxes may be assessed within 6-1/2 years after the document was 
        recorded, if the taxpayer underpays the tax due on the filing of 
        that document by more than 25 percent or the document was 
        erroneously treated as exempt. 
           Subd. 3.  [FRAUD.] Notwithstanding the limitations under 
        subdivision 1, additional taxes may be assessed at any time if a 
        document is presented for recording with a fraudulent intent to 
        underpay the taxes imposed by this chapter.  
           Sec. 24.  [287.385] [INTEREST.] 
           Subdivision 1.  [INTEREST RATE.] If an interest assessment 
        is required under this section, interest is computed at the rate 
        specified in section 270.75. 
           Subd. 2.  [LATE PAYMENT.] If a tax is not paid within the 
        time specified by law for payment, the unpaid tax bears interest 
        from the date the tax should have been paid until the date the 
        tax is paid. 
           Subd. 3.  [EXTENSIONS.] If an extension of time for payment 
        has been granted, interest must be paid from the date the 
        payment should have been made if no extension had been granted, 
        until the date the tax is paid. 
           Subd. 4.  [ADDITIONAL ASSESSMENTS.] If a taxpayer is liable 
        for additional taxes because of a redetermination by the 
        commissioner of revenue, or for any other reason, the additional 
        taxes bear interest from the time the tax should have been paid, 
        without regard to any extension allowed, until the date the tax 
        is paid. 
           Subd. 5.  [REFUNDS.] (a) Interest must be paid at the rate 
        specified in section 270.75 on an overpayment that is refunded 
        or credited to a taxpayer more than 30 days after a refund 
        request is made.  Interest does not apply to the 30-day period. 
           (b) In the case of an erroneous refund, interest accrues 
        from the date the refund was paid unless the erroneous refund 
        results from a mistake of the department of revenue or the 
        county, then no interest or penalty is imposed unless the 
        deficiency assessment is not satisfied within 60 days of the 
        order. 
           Subd. 6.  [INTEREST ON JUDGMENTS.] Notwithstanding section 
        549.09, if judgment is entered in favor of the commissioner of 
        revenue or a county with regard to any tax under this chapter, 
        the judgment bears interest at the rate specified in section 
        270.75 from the date the judgment is entered until the date of 
        payment. 
           Subd. 7.  [INTEREST ON PENALTIES.] A penalty imposed under 
        this chapter bears interest from the date payment was required 
        to be paid, including any extensions, to the date of payment of 
        the penalty. 
           Sec. 25.  [287.39] [ADMINISTRATIVE REVIEW.] 
           Subdivision 1.  [TAXPAYER RIGHT TO RECONSIDERATION.] Under 
        this section, a taxpayer may obtain reconsideration by the 
        commissioner of revenue of:  
           (1) an order of the commissioner assessing tax; 
           (2) a denial by the commissioner of a request for abatement 
        of penalty; or 
           (3) a denial by the commissioner of a claim for refund of 
        money paid to the commissioner as a result of an assessment or 
        order issued by the commissioner under this chapter, by filing 
        an administrative appeal as provided in subdivision 4.  
        A taxpayer cannot obtain reconsideration if the action taken by 
        the commissioner of revenue is the outcome of an administrative 
        appeal. 
           Subd. 2.  [APPEAL BY TAXPAYER.] A taxpayer who wishes to 
        seek administrative review shall follow the procedure in 
        subdivision 4. 
           Subd. 3.  [NOTICE DATE.] For purposes of this section, 
        "notice date" means the date of the order adjusting the tax or 
        order denying a request for abatement or, in the case of a 
        denied refund, the date of the notice of denial. 
           Subd. 4.  [TIME AND CONTENT FOR ADMINISTRATIVE APPEAL.] 
        Within 60 days after the notice date, the taxpayer shall file a 
        written appeal with the commissioner of revenue.  The appeal 
        need not be in any particular form, but must contain the 
        following information: 
           (1) name and address of the taxpayer; 
           (2) if a corporation, the state of incorporation of the 
        taxpayer, and the principal place of business of the 
        corporation; 
           (3) the Minnesota identification number or social security 
        number of the taxpayer; 
           (4) the type of tax involved; 
           (5) the date; 
           (6) the tax periods involved and the amount of tax involved 
        for each period; 
           (7) the findings in the notice that the taxpayer disputes; 
           (8) a summary statement that the taxpayer relies on for 
        each exception; and 
           (9) the taxpayer's signature or the signature of the 
        taxpayer's duly authorized agent. 
           Subd. 5.  [EXTENSIONS.] If requested in writing and within 
        the time allowed for filing an administrative appeal, the 
        commissioner may extend the time for filing an appeal for a 
        period of not more than 30 days from the expiration of the 60 
        days from the notice date. 
           Subd. 6.  [DETERMINATION OF APPEAL.] On the basis of 
        applicable law and available information, the commissioner shall 
        determine the validity, if any, in whole or part of the appeal 
        and notify the taxpayer of the decision.  This notice must be in 
        writing and contain the basis for the determination. 
           Subd. 7.  [AGREEMENT DETERMINING TAX LIABILITY.] If the 
        commissioner determines that it is in the best interests of the 
        state, the commissioner may settle taxes, penalties, or interest 
        that the commissioner has under consideration by virtue of an 
        appeal filed under this section.  An agreement must be in 
        writing and signed by the commissioner and the taxpayer or the 
        taxpayer's representative authorized by the taxpayer to enter 
        into an agreement.  The agreement is final and conclusive and, 
        except upon a showing of fraud or malfeasance, or 
        misrepresentation of a material fact, the case shall not be 
        reopened as to the matters agreed upon. 
           Subd. 8.  [APPEAL OF AN ADMINISTRATIVE DETERMINATION.] 
        Following the determination of an appeal and notwithstanding any 
        period of limitations for making assessments or other 
        determinations to the contrary, the commissioner shall issue an 
        order reflecting that disposition.  If the statute of 
        limitations for making assessments or other determinations would 
        have expired before the issuance of this order, except for this 
        section, the order is limited to issues or matters contained in 
        the appealed determination.  The order is appealable to the 
        Minnesota tax court under section 271.06. 
           Subd. 9.  [APPEAL WHERE NO DETERMINATION.] If the 
        commissioner does not make a determination within six months of 
        the filing of an administrative appeal, the taxpayer may elect 
        to appeal to tax court. 
           Subd. 10.  [EXEMPTION FROM ADMINISTRATIVE PROCEDURE 
        ACT.] This section is not subject to chapter 14. 
           Sec. 26.  [REPEALER.] 
           Minnesota Statutes 1998, sections 287.06; 287.07; 287.09; 
        287.21, subdivisions 2 and 4; 287.34; 287.35; and 287.36, are 
        repealed. 
           Sec. 27.  [EFFECTIVE DATE.] 
           Sections 1 to 26 are effective for documents executed, 
        recorded, or registered after June 30, 1999. 
           Presented to the governor March 30, 1999 
           Signed by the governor April 1, 1999, 1:37 p.m.

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