2003 Minnesota Statutes

CHAPTER 287. Mortgage registry tax; deed tax

MORTGAGE REGISTRY TAX

     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 287.13, have the meanings given 
 them in this section. 

    Subd. 2.    Amendment.  "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.  A document is an 
 amendment if it meets the definition in this subdivision, 
 including documents that do any one or more 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.    Debt.  "Debt" means the principal amount of 
 an obligation to pay money 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 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 meanings 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. 

    HIST: (2322) 1907 c 328 s 1; 1965 c 51 s 51; 1976 c 181 s 2; 
 1983 c 233 s 1; 1990 c 575 s 1; 1999 c 31 s 1; 1999 c 243 art 16 
 s 11; 2000 c 490 art 10 s 2 

  287.02 Repealed, 1987 c 268 art 14 s 25 

     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. 

    HIST: (2322) 1907 c 328 s 1; 1983 c 233 s 2; 1999 c 31 s 2 

     287.035 Imposition of tax. 

    A tax is imposed on the privilege of recording a mortgage.  
 The tax rate is .0023 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 mortgagor.  
 The tax is not imposed on the lawful interest amounts that may 
 accrue with respect to a debt. 

    HIST: 1999 c 31 s 3; 1Sp2001 c 5 art 7 s 24 

     287.04 Exemptions. 

    The tax imposed by section 287.035 does not apply to:  

    (a) A decree of marriage dissolution or an instrument made 
 pursuant to it.  

    (b) A mortgage given to correct a misdescription of the 
 mortgaged property. 

    (c) A mortgage or other instrument that adds additional 
 security for the same debt for which mortgage registry tax has 
 been paid.  

    (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. 

    (f) The principal amount of a mortgage loan made under a 
 low and moderate income or other affordable housing program, if 
 the mortgagee is a federal, state, or local government agency. 

    (g) Mortgages granted by fraternal benefit societies 
 subject to section 64B.24. 

    (h) A mortgage amendment or extension, as defined in 
 section 287.01. 

    (i) An agricultural mortgage if the proceeds of the loan 
 secured by the mortgage are used to acquire or improve real 
 property classified under section 273.13, subdivision 23, 
 paragraph (a), or (b), clause (1), (2), or (3). 

    HIST: (2322) 1907 c 328 s 1; 1965 c 51 s 53; 1967 c 340 s 1; 
 1983 c 233 s 3; 1993 c 271 s 4; 1999 c 31 s 4; 1Sp2001 c 5 art 7 
 s 25 

     287.05 Determination of tax in special situations. 

    Subdivision 1.    Real property outside Minnesota.  (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 and additional amounts for accrued interest and 
 advances not subject to tax under subdivision 4 or section 
 287.035.  

    (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 and 
 additional amounts for accrued interest and advances not subject 
 to tax under subdivision 4 or section 287.035.  

    (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 document that alters an existing mortgage 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 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. 

    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 section 287.035 must be paid 
 on the maximum amount of the line of credit 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 section 
 287.035 shall be paid on the indeterminate amount 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, but the tax must be paid at the time of 
 recording 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. 

    HIST: (2323) 1907 c 328 s 2; 1913 c 163 s 1; 1917 c 73 s 1; 
 1921 c 445 s 1; 1945 c 288 s 1; 1951 c 591 s 1; 1957 c 167 s 1; 
 1961 c 499 s 1; 1967 c 340 s 2; 1973 c 582 s 3; 1983 c 342 art 2 
 s 24; 1984 c 502 art 14 s 7-9; 1Sp1985 c 14 art 11 s 1; 1987 c 
 268 art 14 s 13; 1987 c 403 art 2 s 147; 1991 c 291 art 20 s 2; 
 1999 c 31 s 5; 1999 c 243 art 16 s 12,13 

  287.06 Repealed, 1999 c 31 s 26 

  287.07 Repealed, 1999 c 31 s 26 

     287.08 Tax, how payable; receipts. 

    (a) The tax imposed by sections 287.01 to 287.12 must be 
 paid to the treasurer of any county in this state in which the 
 real property or some part is located at or before the time of 
 filing the mortgage for record.  The treasurer shall endorse 
 receipt on the mortgage and the receipt is conclusive proof that 
 the tax has been paid in the amount stated and 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 mortgage is exempt 
 from taxation the endorsement shall, in substance, be "exempt 
 from registration tax."  In either case the receipt must be 
 signed by the treasurer.  In case the treasurer is unable to 
 determine whether a claim of exemption should be allowed, the 
 tax must be paid as in the case of a taxable mortgage.  

    (b) The county treasurer may refund in whole or in part any 
 mortgage registry tax overpayment if a written application by 
 the taxpayer is submitted to the county treasurer within 3-1/2 
 years from the date of the overpayment.  If the county has not 
 issued a denial of the application, the taxpayer may bring an 
 action in Tax Court in the county in which the tax was paid at 
 any time after the expiration of six months from the time that 
 the application was submitted.  A denial of refund may be 
 appealed within 60 days from the date of the denial by bringing 
 an action in Tax Court in the county in which the tax was paid.  
 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 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 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 mortgage covers 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 mortgage is first presented 
 for recording, and the payment must be receipted as 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 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 
 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 the division and payment the county treasurer shall send 
 a statement giving the description of the real property 
 described in the mortgage and the market value of the part 
 located in each county.  For this purpose, 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 real property 
 in any mortgage. 

    (e) The mortgagor must pay the tax imposed by sections 
 287.01 to 287.12.  The mortgagee may undertake to collect and 
 remit the tax on behalf of the mortgagor.  If the mortgagee 
 collects money from the mortgagor to remit the tax on behalf of 
 the mortgagor, the mortgagee has a fiduciary duty to remit the 
 tax on behalf of the mortgagor as to the amount of the tax 
 collected for that purpose and the mortgagor is relieved of any 
 further obligation to pay the tax as to the amount collected by 
 the mortgagee for this purpose. 

    HIST: (2326) 1907 c 328 s 5; 1965 c 51 s 55; 1976 c 181 s 2; 
 1983 c 222 s 21; 1Sp1985 c 14 art 11 s 2; 1986 c 444; 1Sp1986 c 
 3 art 1 s 82; 1997 c 84 art 1 s 2; 1998 c 389 art 3 s 15; 1999 c 
 31 s 6; 1Sp2001 c 5 art 7 s 26 

  287.09 Repealed, 1999 c 31 s 26 

     287.10 Prepayment of tax; evidence; notice. 

    A mortgage, or documents relating to its foreclosure, 
 assignment, or satisfaction, must not be recorded unless the tax 
 has been paid.  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 the tax imposed under 
 section 287.035.  

    HIST: (2328) 1907 c 328 s 7; 1913 c 163 s 2; 1929 c 222 s 1; 
 1Sp1985 c 18 s 3; 1987 c 268 art 14 s 14; 1999 c 31 s 7 

     287.11 Mortgages recorded or registered prior to passage 
  of sections 287.01 to 287.12. 

    All mortgages of real property recorded prior to the 
 passage of sections 287.01 to 287.12 are taxable under the 
 provisions of law existing prior to the enactment of sections 
 287.01 to 287.12; provided, that the holder of any such mortgage 
 may pay to the treasurer of the proper county the tax based upon 
 the amount of the debt secured by the mortgage at the time of 
 the payment as stated by the affidavit of the owner of the 
 mortgage.  The affidavit may be filed with the county treasurer, 
 in which case the treasurer's receipt must be endorsed on it.  
 The county recorder or registrar of titles, on presentation of 
 the receipt, shall make a record of the date and amount of the 
 payment.  Thereafter the mortgage lien shall not be otherwise 
 taxable. 

    HIST: (2329) 1907 c 328 s 8; 1913 c 163 s 3; 1965 c 51 s 56; 
 1976 c 181 s 2; 1999 c 31 s 8 

     287.12 Taxes, how apportioned. 

    (a) All taxes paid to the county treasurer under the 
 provisions of sections 287.01 to 287.12 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 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 registry 
 tax during the preceding month subject to the electronic payment 
 requirements of section 270.771.  The county treasurer shall 
 provide any related reports requested by the commissioner of 
 revenue. 

    (c) Counties must remit the state's portion of the June 
 receipts collected through June 25 and the estimated state's 
 portion of the receipts to be collected during the remainder of 
 the month to the commissioner of revenue two business days 
 before June 30 of each year.  The remaining amount of the June 
 receipts is due on August 20. 

    HIST: (2330) 1907 c 328 s 9; 1913 c 352 s 1; 1963 c 713 s 1; 
 1965 c 51 s 57; 1969 c 399 s 49; 1973 c 650 art 5 s 1; 1981 c 
 164 s 1; 1Sp1985 c 14 art 11 s 4; 1Sp1986 c 1 art 4 s 36; 1987 c 
 403 art 2 s 148; 1989 c 282 art 1 s 19; 1Sp1989 c 1 art 3 s 24; 
 1999 c 31 s 9; 1Sp2001 c 5 art 17 s 6; 1Sp2003 c 21 art 9 s 4 

     287.13 Violations; civil penalties. 

    Subdivision 1.    Failure to pay full amount.  Any 
 person liable for the tax imposed by section 287.035 who fails 
 to pay the full amount of mortgage registry tax imposed under 
 this chapter, unless 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. 

    Subd. 2.    Additional penalty.  Any person who 
 willfully attempts to evade or defeat the tax imposed under 
 sections 287.01 to 287.12, or the payment thereof, shall, in 
 addition to the penalty provided in subdivision 1, be liable for 
 a penalty of 50 percent of the total amount of the underpayment 
 of the tax. 

    Subd. 3.    Payment to mortgagee.  If a mortgagee 
 undertakes to collect from the mortgagor the amount of the tax 
 due under sections 287.01 to 287.12 as provided in section 
 287.08, paragraph (e), the mortgagor is not subject to the 
 penalties under this section and the mortgagee is subject to the 
 provisions of this section. 

    HIST: 1997 c 84 art 6 s 17; 1999 c 31 s 10; 1Sp2001 c 5 art 7 
 s 27 

DEED TAX

     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, if the contract for deed, or 
 other agreement entered into as a condition to the seller 
 executing the contract, requires the property to be improved 
 during the term of the contract and the price of the real 
 property as reflected in the contract does not include the 
 consideration for the required improvements, then the 
 consideration is the price for the real property as reflected in 
 the contract and the consideration for the required improvements 
 added during the term of the contract.  

    (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 if at the time of the transfer the 
 transfer qualifies as:  (i) a corporate reorganization under 
 section 368(a) of the Internal Revenue Code of 1986, as amended 
 through December 31, 2000; or (ii) a transfer pursuant to the 
 continuation of an existing partnership under section 708 of the 
 Internal Revenue Code of 1986, as amended through December 31, 
 2000. 

    HIST: 1999 c 31 s 11; 1Sp2001 c 5 art 7 s 28,29 

     287.21 Imposition of tax; determination of tax. 

    Subdivision 1.    Determination of tax.  (a) A tax is 
 imposed on each deed or instrument by which any real property in 
 this state is granted, assigned, transferred, or otherwise 
 conveyed.  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 the entities as defined in section 287.20, subdivision 
 9, pursuant to plans of reorganization, 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 is $1.65; 
 or (3) when the consideration, exclusive of the value of any 
 lien or encumbrance remaining at the time of sale, exceeds $500, 
 the tax is .0033 of the net consideration. 

    (c) The tax is due at the time a taxable deed or instrument 
 is presented for recording. 

    Subd. 2. Repealed, 1999 c 31 s 26 

    Subd. 3.  Expired 

    Subd. 4. Repealed, 1999 c 31 s 26 

    HIST: 1961 c 647 s 1; Ex1967 c 32 art 11 s 1; 1969 c 399 s 24; 
 1973 c 118 s 1; 1Sp1985 c 14 art 11 s 5; 1987 c 268 art 14 s 15; 
 1987 c 403 art 2 s 149; 1988 c 719 art 19 s 13; 1990 c 480 art 7 
 s 23; 1993 c 375 art 3 s 39; 1999 c 31 s 12; 1Sp2001 c 5 art 7 s 
 30 

     287.22 Exemptions. 

    The tax imposed by section 287.21 does not apply to: 

    (1) An executory contract for the sale of real property 
 under which the purchaser is entitled to or does take possession 
 of the real property, or any assignment or cancellation of the 
 contract; 

    (2) A mortgage or an amendment, assignment, extension, 
 partial release, or satisfaction of a mortgage; 

    (3) A will; 

    (4) A plat; 

    (5) A lease, amendment of lease, assignment of lease, or 
 memorandum of lease; 

    (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; 

    (7) A deed for a cemetery lot or lots; 

    (8) A deed of distribution by a personal representative; 

    (9) A deed to or from a co-owner partitioning their 
 undivided interest in the same piece of real property; 

    (10) A deed or other instrument of conveyance issued 
 pursuant to a permanent school fund land exchange under section 
 92.121 and related laws; 

    (11) A referee's or sheriff's certificate of sale in a 
 mortgage or lien foreclosure sale; 

    (12) A referee's, sheriff's, or certificate holder's 
 certificate of redemption from a mortgage or lien foreclosure 
 sale issued to the redeeming mortgagor or lienee; 

    (13) A deed, instrument, or writing which grants, creates, 
 modifies, or terminates an easement; and 

    (14) A decree of marriage dissolution, as defined in 
 section 287.01, subdivision 4, or a deed or other instrument 
 between the parties to the dissolution made pursuant to the 
 terms of the decree. 

    HIST: 1961 c 647 s 2; 1963 c 249 s 1; 1971 c 835 s 1; 1975 c 
 347 s 1; 1984 c 590 s 1; 1987 c 268 art 14 s 16; 1991 c 291 art 
 21 s 11; 1993 c 375 art 3 s 40; 1997 c 31 art 3 s 13; 1997 c 231 
 art 16 s 9; 1999 c 31 s 13 

     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. 

    HIST: 1999 c 31 s 14 

     287.221 New residential construction. 

    The commissioner of revenue may not enforce a deed tax 
 assessment on the consideration paid for an improvement in the 
 case of new residential construction if, at or before the time 
 the first residential owners of the improvement take possession, 
 the deed tax has been paid on the consideration paid for the 
 improvement. 

    HIST: 1997 c 231 art 16 s 10 

     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 describes any real property located outside of this 
 state, the tax imposed by section 287.21 must be measured upon 
 such proportion of the consideration, exclusive of the value of 
 any lien or encumbrance remaining at the time of sale, as the 
 value of the real property described in this state bears to the 
 value of the whole of the real property described in the deed or 
 instrument.  

    HIST: 1961 c 647 s 3; 1973 c 582 s 3; 1Sp1985 c 14 art 11 s 6; 
 1999 c 31 s 15 

     287.24 Persons liable. 

    Subdivision 1.    General rule.  Any person who grants, 
 assigns, transfers, or conveys any real property by a deed 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. 

    HIST: 1961 c 647 s 4; 1986 c 444; 1999 c 31 s 16 

     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, taxable under the provisions of section 
 287.21, shall be recorded unless it 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 any deed or instrument when the statement sets 
 forth that the transfer is tax exempt, or when documentary 
 stamps or the treasurer's receipt appear for the amount of deed 
 tax recited in the statement.  The validity or effectiveness of 
 a deed or instrument as between the parties, and as to any 
 person who would otherwise be bound, is not affected by the 
 failure to comply with this section.  If a deed or instrument is 
 accepted for recording contrary to this section, the failure to 
 comply does not destroy or impair the record 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 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 
 unless such deed or instrument 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. 

    Subd. 3.  Repealed, 1977 c 423 art 4 s 11 

    Subd. 4.  Repealed, 1977 c 423 art 4 s 11 

    HIST: 1963 c 831 s 1; 1971 c 838 s 1; 1973 c 582 s 3; 1974 c 
 253 s 1,2; 1976 c 181 s 2; 1977 c 423 art 4 s 10; 1986 c 444; 
 1999 c 31 s 17 

     287.25 Payment of tax; stamps. 

    The county board shall determine the method for collection 
 of the tax imposed by section 287.21:  

    (1) The tax imposed by section 287.21 may be paid by the 
 affixing of a documentary stamp or stamps in the amount of the 
 tax to the document or instrument with respect to which the tax 
 is paid, provided that the county board may permit the payment 
 of the tax without the affixing of the documentary stamps and in 
 such cases shall direct the treasurer to endorse a receipt for 
 such tax upon the face of the document or instrument.  

    (2) The tax imposed by section 287.21 may be paid in the 
 manner prescribed by section 287.08 relating to payment of 
 mortgage registration tax. 

    HIST: 1961 c 647 s 5; 1969 c 399 s 1; 1973 c 582 s 3; 1985 c 
 300 s 18; 1Sp1985 c 14 art 11 s 7 

     287.26 Cancellation of stamps.  

    A person using or affixing a stamp shall cancel it and so 
 deface it as to render it unfit for reuse by marking it in ink 
 with the person's initials and the date on which such affixing 
 occurs.  

    HIST: 1961 c 647 s 6; 1986 c 444 

     287.27 Stamps; printing and sale-meters. 

    Subdivision 1.  The county board may have documentary 
 stamps printed and furnish them to the county treasurer.  
 Documentary stamps may be purchased only from the county 
 treasurer and may not be sold for use in any county other than 
 the county in which the property is located.  

    Subd. 2.  The county board may authorize any person to 
 utilize a tax meter machine upon the filing of a corporate 
 surety bond, in a suitable amount to guarantee the payment of 
 the tax, such amount to be determined by the county board.  

    The county board may provide rules for the use of such a 
 machine, supervise its operation and provide for the payment of 
 the tax on any deed or document so stamped. 

    HIST: 1961 c 647 s 7; 1965 c 454 s 1; 1973 c 582 s 3; 1Sp1985 
 c 14 art 11 s 13; 1Sp1986 c 1 art 4 s 49,50 

     287.28 Refunds or redemption. 

    (a) The county treasurer may redeem stamps issued under the 
 authority of sections 287.20 to 287.31 that have been spoiled, 
 destroyed, or rendered useless or unfit for the purpose intended 
 or for which the owner may have no use or which through mistake 
 may have been improperly or unnecessarily used.  Redemption 
 shall be made only upon written application of the taxpayer.  

    (b) The county treasurer may refund any deed tax 
 overpayment if a written application by the taxpayer is 
 submitted to the county treasurer within 3-1/2 years from the 
 date of the overpayment.  If the county has not issued a denial 
 of the application, the taxpayer may bring an action in Tax 
 Court in the county in which the tax was paid at any time after 
 the expiration of six months from the time that the application 
 was submitted.  A denial of refund may be appealed within 60 
 days from the date of the denial by commencing an action in Tax 
 Court in the county where the tax was paid.  The action is 
 commenced by serving a petition for relief on the county 
 treasurer, and 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.  Any refund of deed tax which the 
 county treasurer determines should be made, and any court 
 ordered refund of deed tax, shall be accomplished using the 
 refund procedures in section 287.08. 

    HIST: 1961 c 647 s 8; 1969 c 97 s 3; 1969 c 399 s 1; 1973 c 
 582 s 3; 1Sp1985 c 14 art 11 s 9; 1997 c 84 art 1 s 3; 2000 c 
 260 s 48; 1Sp2001 c 5 art 7 s 31 

     287.29 Payment of receipts to state general fund; 
  reports. 

    Subdivision 1.    Appointment and payment of tax proceeds. 
  (a) The proceeds of the taxes levied and collected under 
 sections 287.21 to 287.39 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 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 
 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. 

    (c) Counties must remit the state's portion of the June 
 receipts collected through June 25 and the estimated state's 
 portion of the receipts to be collected during the remainder of 
 the month to the commissioner of revenue two business days 
 before June 30 of each year.  The remaining amount of the June 
 receipts is due on August 20. 

    Subd. 2. Repealed, 1981 c 164 s 12 

    Subd. 3. Repealed, 1Sp1985 c 14 art 11 s 13 

    HIST: 1961 c 647 s 9; 1969 c 399 s 1; 1973 c 582 s 3; 1981 c 
 164 s 2; 1Sp1985 c 14 art 11 s 10; 1Sp1986 c 1 art 4 s 37; 
 1Sp1989 c 1 art 3 s 25; 1990 c 480 art 7 s 24; 1999 c 31 s 18; 
 2000 c 260 s 49; 1Sp2003 c 21 art 9 s 5 

     287.30 County treasurer; duties. 

    The care of documentary stamps entrusted to county 
 treasurers and the duties imposed upon county treasurers by this 
 chapter are within the duties of such office and 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. 

    HIST: 1961 c 647 s 10; 1986 c 444; 1999 c 31 s 19 

     287.31 Violations; civil penalties. 

    Subdivision 1.    Failure to pay full amount.  Any 
 person liable for the tax imposed by section 287.21 who fails to 
 pay the full amount of deed tax imposed under this chapter, 
 unless the failure is shown to be due to reasonable cause, 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, is, in addition to other penalties provided by 
 law, liable to a penalty of 50 percent of the total amount of 
 the underpayment of the tax.  

    Subd. 3.    Underpayments of accelerated payment of June 
 tax receipts.  If a county fails to timely remit the state 
 portion of the actual June tax receipts at the time required by 
 section 287.12 or 287.29, the county shall pay a penalty equal 
 to ten percent of the state portion of actual June receipts less 
 the amount remitted to the commissioner of revenue in June.  The 
 penalty must not be imposed, however, if the amount remitted in 
 June equals either: 

    (1) 90 percent of the state's portion of the preceding 
 May's receipts; or 

    (2) 90 percent of the average monthly amount of the state's 
 portion for the previous calendar year. 

    HIST: 1961 c 647 s 11; 1997 c 84 art 6 s 18; 1999 c 31 s 20; 
 1Sp2003 c 21 art 9 s 6 

  287.32 Repealed, 1Sp1985 c 14 art 11 s 13 

PENALTY AND ADMINISTRATIVE PROVISIONS

OF COMMON APPLICABILITY

     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. 

    HIST: 1999 c 31 s 21 

     287.33 Expenses of administration. 

    Expenses of administration of this chapter to be paid out 
 of county funds include fees and expenses incurred by the county 
 attorney in connection with this chapter and all other costs and 
 expenses.  

    HIST: 1961 c 647 s 13; 1973 c 582 s 3; 1Sp1985 c 14 art 11 s 
 11; 1999 c 31 s 22 

  287.34 Repealed, 1999 c 31 s 26 

  287.35 Repealed, 1999 c 31 s 26 

  287.36 Repealed, 1999 c 31 s 26 

     287.37 Investigations and assessments. 

    The commissioner of revenue may investigate and examine 
 persons and transactions that are subject to this chapter using 
 the powers and authorities granted in chapters 270 and 289A.  
 The commissioner may issue orders of assessment under chapter 
 289A, and enforce collection of unpaid tax or penalty amounts, 
 including interest, under the authority of chapter 270.  All tax 
 amounts collected by the commissioner must be apportioned under 
 section 287.12.  The commissioner's expenses under this section 
 are not expenses of administration under section 287.33.  All 
 data and information made available to the commissioner under 
 this section is public except for investigative data covered by 
 section 270B.03, subdivision 6. 

    HIST: 1996 c 471 art 3 s 32 

     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.  

    HIST: 1999 c 31 s 23 

     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. 

    HIST: 1999 c 31 s 24 

     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. 

    HIST: 1999 c 31 s 25