1.1 A bill for an act
1.2 relating to taxation; converting the property tax refund program to a refundable
1.3 income tax credit; amending Minnesota Statutes 2022, sections 270B.12,
1.4 subdivision 8; 289A.38, subdivision 4; 289A.56, subdivision 6; 289A.60,
1.5 subdivision 12; 290A.02; 290A.03, subdivisions 3, 6, 8, 12; 290A.04, subdivision
1.6 1; 290A.05; 290A.07, subdivision 2a; 290A.08; 290A.09; 290A.091; 290A.13;
1.7 290A.19; 290A.25; 462A.05, subdivision 24; proposing coding for new law in
1.8 Minnesota Statutes, chapter 290; repealing Minnesota Statutes 2022, sections
1.9 290A.03, subdivisions 9, 11; 290A.04, subdivisions 2a, 5; 290A.23, subdivision
1.10 1.
1.11BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.12 Section 1. Minnesota Statutes 2022, section 270B.12, subdivision 8, is amended to read:
1.13 Subd. 8.County assessors; homestead classification and renter renter's credit.The
1.14commissioner may disclose names and Social Security numbers of individuals who have
1.15applied for both homestead classification under section 273.13 and a property tax refund
1.16as a renter under chapter 290A renter's credit under section 290.0693 for the purpose of and
1.17to the extent necessary to administer section 290A.25.
1.18 EFFECTIVE DATE.This section is effective for credits based on rent paid after
1.19December 31, 2022.
1.20 Sec. 2. Minnesota Statutes 2022, section 289A.38, subdivision 4, is amended to read:
1.21 Subd. 4.Property tax refund.For purposes of computing the limitation under this
1.22section, the due date of the property tax refund return as provided for in chapter 290A is
1.23the due date for an income tax return covering the year in which the rent was paid or the
1.24year preceding the year in which the property taxes are payable.
1Sec. 2.
23-00701 as introduced12/21/22 REVISOR EAP/NB
SENATE
STATE OF MINNESOTA
S.F. No. 45NINETY-THIRD SESSION
(SENATE AUTHORS: KLEIN and Rest)
OFFICIAL STATUSD-PGDATE
Introduction and first reading01/05/2023
Referred to Taxes 2.1 EFFECTIVE DATE.This section is effective for credits based on rent paid after
2.2December 31, 2022.
2.3 Sec. 3. Minnesota Statutes 2022, section 289A.56, subdivision 6, is amended to read:
2.4 Subd. 6.Property tax refunds under chapter 290A.(a) When a renter is owed a
2.5property tax refund, an unpaid refund bears interest after August 14, or 60 days after the
2.6refund claim was made, whichever is later, until the date the refund is paid.
2.7 (b) When any other a claimant is owed a property tax refund under chapter 290A, the
2.8unpaid refund bears interest after September 29, or 60 days after the refund claim was made,
2.9whichever is later, until the date the refund is paid.
2.10 EFFECTIVE DATE.This section is effective for credits based on rent paid after
2.11December 31, 2022.
2.12 Sec. 4. Minnesota Statutes 2022, section 289A.60, subdivision 12, is amended to read:
2.13 Subd. 12.Penalties relating to property tax refunds.(a) If it is determined that a
2.14property tax refund claim is excessive and was negligently prepared, a claimant is liable
2.15for a penalty of ten percent of the disallowed claim. If the claim has been paid, the amount
2.16disallowed must be recovered by assessment and collection.
2.17 (b) An owner who without reasonable cause fails to give a certificate of rent constituting
2.18property tax to a renter, as required by section sections 290.0693, subdivision 4, and 290A.19,
2.19paragraph (a), is liable to the commissioner for a penalty of $100 for each failure.
2.20 (c) If the owner or managing agent knowingly gives rent certificates that report total
2.21rent constituting property taxes in excess of the amount of actual rent constituting property
2.22taxes paid on the rented part of a property, the owner or managing agent is liable for a
2.23penalty equal to the greater of (1) $100 or (2) 50 percent of the excess that is reported. An
2.24overstatement of rent constituting property taxes is presumed to be knowingly made if it
2.25exceeds by ten percent or more the actual rent constituting property taxes.
2.26 EFFECTIVE DATE.This section is effective for credits based on rent paid after
2.27December 31, 2022.
2.28 Sec. 5. [290.0693] RENTER'S CREDIT.
2.29 Subdivision 1.Definitions.(a) For the purposes of this section, the following terms have
2.30the meanings given.
2Sec. 5.
23-00701 as introduced12/21/22 REVISOR EAP/NB 3.1 (b) "Dependent" means any individual who is considered a dependent under sections
3.2151 and 152 of the Internal Revenue Code.
3.3 (c) "Disability" has the meaning given in section 290A.03, subdivision 10.
3.4 (d) "Exemption amount" means the exemption amount under section 290.0121,
3.5subdivision 1, paragraph (b).
3.6 (e) "Gross rent" means rent paid for the right of occupancy, at arm's length, of a
3.7homestead, exclusive of charges for any medical services furnished by the landlord as a
3.8part of the rental agreement, whether expressly set out in the rental agreement or not. The
3.9gross rent of a resident of a nursing home or intermediate care facility is $530 per month.
3.10The gross rent of a resident of an adult foster care home is $830 per month. The commissioner
3.11shall annually adjust the amounts in this paragraph as provided in section 270C.22. The
3.12statutory year is 2022. If the landlord and tenant have not dealt with each other at arm's
3.13length and the commissioner determines that the gross rent charged was excessive, the
3.14commissioner may adjust the gross rent to a reasonable amount for purposes of this chapter.
3.15 (f) "Homestead" has the meaning given in section 290A.03, subdivision 6.
3.16 (g) "Household" has the meaning given in section 290A.03, subdivision 4.
3.17 (h) "Household income" means all income received by all persons of a household in a
3.18taxable year while members of the household, other than income of a dependent.
3.19 (i) "Income" means adjusted gross income, minus:
3.20 (1) for the taxpayer's first dependent, the exemption amount multiplied by 1.4;
3.21 (2) for the taxpayer's second dependent, the exemption amount multiplied by 1.3;
3.22 (3) for the taxpayer's third dependent, the exemption amount multiplied by 1.2;
3.23 (4) for the taxpayer's fourth dependent, the exemption amount multiplied by 1.1;
3.24 (5) for the taxpayer's fifth dependent, the exemption amount; and
3.25 (6) if the taxpayer or taxpayer's spouse had a disability or attained the age of 65 on or
3.26before the close of the taxable year, the exemption amount.
3.27 (j) "Rent constituting property taxes" means 17 percent of the gross rent actually paid
3.28in cash, or its equivalent, or the portion of rent paid in lieu of property taxes, in any taxable
3.29year by a claimant for the right of occupancy of the claimant's Minnesota homestead in the
3.30taxable year, and which rent constitutes the basis, in the succeeding taxable year of a claim
3.31for a credit under this section by the claimant. If an individual occupies a homestead with
3Sec. 5.
23-00701 as introduced12/21/22 REVISOR EAP/NB 4.1another person or persons not related to the individual as the individual's spouse or as
4.2dependents, and the other person or persons are residing at the homestead under a rental or
4.3lease agreement with the individual, the amount of rent constituting property tax for the
4.4individual equals that portion not covered by the rental agreement.
4.5 Subd. 2.Credit allowed; refundable.(a) An individual is allowed a credit against the
4.6tax due under this chapter equal to the amount that rent constituting property taxes exceeds
4.7the percentage of the household income of the claimant specified in subdivision 3 in the
4.8taxable year in which the rent was paid as specified in that subdivision.
4.9 (b) If the amount of credit which a taxpayer is eligible to receive under this section
4.10exceeds the taxpayer's liability for tax under this chapter, the commissioner shall refund the
4.11excess to the taxpayer.
4.12 Subd. 3.Renters.(a) A taxpayer whose rent constituting property taxes exceeds the
4.13percentage of the household income stated below must pay an amount equal to the percent
4.14of income shown for the appropriate household income level along with the co-payment of
4.15the remaining amount of rent constituting property taxes. The credit under subdivision 2
4.16equals the amount of rent constituting property taxes that remain, up to the maximum credit
4.17amount shown below.
Maximum CreditCo-paymentPercent of Income4.18 Household Income
2,400$5 percent1.0 percent4.19 $0 to 5,879
2,400$10 percent1.0 percent4.20 5,880 to 7,809
2,330$10 percent1.1 percent4.21 7,810 to 9,769
2,280$10 percent1.2 percent4.22 9,770 to 13,699
2,210$15 percent1.3 percent4.23 13,700 to 17,609
2,150$15 percent1.4 percent4.24 17,610 to 19,559
2,100$20 percent1.4 percent4.25 19,560 to 21,499
2,030$20 percent1.5 percent4.26 21,500 to 25,429
1,980$20 percent1.6 percent4.27 25,430 to 27,379
1,980$25 percent1.7 percent4.28 27,380 to 29,329
1,980$25 percent1.8 percent4.29 29,330 to 33,249
1,980$30 percent1.9 percent4.30 33,250 to 35,189
1,980$30 percent2.0 percent4.31 35,190 to 41,059
1,980$35 percent2.0 percent4.32 41,060 to 46,919
1,980$40 percent2.0 percent4.33 46,920 to 54,759
1,800$45 percent2.0 percent4.34 54,760 to 56,699
1,620$45 percent2.0 percent4.35 56,700 to 58,669
1,370$45 percent2.0 percent4.36 58,670 to 60,629
4Sec. 5.
23-00701 as introduced12/21/22 REVISOR EAP/NB 1,190$50 percent2.0 percent5.1 60,630 to 62,569
1,080$50 percent2.0 percent5.2 62,570 to 64,539
600$50 percent2.0 percent5.3 64,540 to 66,489
230$50 percent2.0 percent5.4 66,490 to 68,439
5.5 The credit is the amount calculated under this subdivision. No credit is allowed if the
5.6taxpayer's household income is $68,440 or more.
5.7 (b) The commissioner must annually adjust the dollar amounts of the income thresholds
5.8and the maximum refunds in paragraph (a), as provided in section 270C.22. The statutory
5.9year is 2022.
5.10 (c) The commissioner shall construct and make available to taxpayers a comprehensive
5.11table showing the rent constituting property taxes to be paid and refund allowed at various
5.12levels of income and assessment. The table shall follow the schedule of income percentages,
5.13maximums, and other provisions specified in paragraph (a), except that the commissioner
5.14may graduate the transition between income brackets. All refunds shall be computed in
5.15accordance with tables prepared and issued by the commissioner.
5.16 Subd. 4.Owner or managing agent to furnish rent certificate.(a) The owner or
5.17managing agent of any property for which rent is paid for occupancy as a homestead must
5.18furnish a certificate of rent paid to a person who is a renter on December 31, in the form
5.19prescribed by the commissioner. If the renter moves before December 31, the owner or
5.20managing agent may give the certificate to the renter at the time of moving, or mail the
5.21certificate to the forwarding address if an address has been provided by the renter. The
5.22certificate must be made available to the renter before February 1 of the year following the
5.23year in which the rent was paid. The owner or managing agent must retain a duplicate of
5.24each certificate or an equivalent record showing the same information for a period of three
5.25years. The duplicate or other record must be made available to the commissioner upon
5.26request.
5.27 (b) The commissioner may require the owner or managing agent, through a simple
5.28process, to furnish to the commissioner on or before March 1 a copy of each certificate of
5.29rent paid furnished to a renter for rent paid in the prior year. The commissioner shall prescribe
5.30the content, format, and manner of the form pursuant to section 270C.30. The commissioner
5.31may require the Social Security number, individual taxpayer identification number, federal
5.32employer identification number, or Minnesota taxpayer identification number of the owner
5.33or managing agent who is required to furnish a certificate of rent paid under this paragraph.
5.34Before implementation, the commissioner, after consulting with representatives of owners
5.35or managing agents, shall develop an implementation and administration plan for the
5Sec. 5.
23-00701 as introduced12/21/22 REVISOR EAP/NB 6.1requirements of this paragraph that attempts to minimize financial burdens, administration
6.2and compliance costs, and takes into consideration existing systems of owners and managing
6.3agents.
6.4 Subd. 5.Eligibility; residency.(a) A taxpayer is eligible for the credit under this section
6.5if the taxpayer is an individual, other than a dependent, as defined under sections 151 and
6.6152 of the Internal Revenue Code, disregarding section 152(b)(3) of the Internal Revenue
6.7Code, who filed for a credit and who was a resident of this state during the taxable year for
6.8which the credit was claimed.
6.9 (b) In the case of a credit for rent constituting property taxes of a part-year Minnesota
6.10resident, the household income and rent constituting property taxes reflected in this
6.11computation shall be for the period of Minnesota residency only. Any rental expenses paid
6.12that may be reflected in arriving at federal adjusted gross income cannot be utilized for this
6.13computation.
6.14 (c) When two individuals of a household are able to meet the qualifications to claim a
6.15credit under this section, the individuals may determine among them as to which individual
6.16may claim the credit. If the individuals are unable to agree, the matter shall be referred to
6.17the commissioner of revenue whose decision shall be final.
6.18 (d) To claim a credit under this section, the taxpayer must have resided in a rented or
6.19leased unit on which ad valorem taxes or payments made in lieu of ad valorem taxes,
6.20including payments of special assessments imposed in lieu of ad valorem taxes, are payable
6.21at some time during the taxable year for which the taxpayer claimed the credit.
6.22 Subd. 6.Residents of nursing homes, intermediate care facilities, long-term care
6.23facilities, or facilities accepting housing support payments.(a) A taxpayer must not claim
6.24a credit under this section if the taxpayer is a resident of a nursing home, intermediate care
6.25facility, long-term residential facility, or a facility that accepts housing support payments
6.26whose rent constituting property taxes is paid pursuant to the Supplemental Security Income
6.27program under title XVI of the Social Security Act, the Minnesota supplemental aid program
6.28under sections 256D.35 to 256D.54, the medical assistance program pursuant to title XIX
6.29of the Social Security Act, or the housing support program under chapter 256I.
6.30 (b) If only a portion of the rent constituting property taxes is paid by these programs,
6.31the resident is eligible for a credit, but the credit calculated must be multiplied by a fraction,
6.32the numerator of which is adjusted gross income, reduced by the total amount of income
6.33from the above sources other than vendor payments under the medical assistance program
6Sec. 5.
23-00701 as introduced12/21/22 REVISOR EAP/NB 7.1and the denominator of which is adjusted gross income, plus vendor payments under the
7.2medical assistance program, to determine the allowable credit.
7.3 (c) Notwithstanding paragraphs (a) and (b), if the taxpayer was a resident of the nursing
7.4home, intermediate care facility, long-term residential facility, or facility for which the rent
7.5was paid for the claimant by the housing support program for only a portion of the taxable
7.6year covered by the claim, the taxpayer may compute rent constituting property taxes by
7.7disregarding the rent constituting property taxes from the nursing home or facility and may
7.8use only that amount of rent constituting property taxes or property taxes payable relating
7.9to that portion of the year when the taxpayer was not in the facility. The taxpayer's household
7.10income is the income for the entire taxable year covered by the claim.
7.11 Subd. 7.Credit for unmarried taxpayers residing in the same household.If a
7.12homestead is occupied by two or more renters who are not married to each other, the rent
7.13shall be deemed to be paid equally by each renter, and separate claims shall be filed by each
7.14renter. The income of each renter shall be each renter's household income for purposes of
7.15computing the amount of credit to be allowed.
7.16 Subd. 8.One claimant per household.Only one taxpayer per household per year is
7.17entitled to claim a credit under this section. In the case of a married taxpayer filing a separate
7.18return, only one spouse may claim the credit under this section. The credit amount for the
7.19spouse that claims the credit must be calculated based on household income and not solely
7.20on the income of the spouse.
7.21 Subd. 9.Proof of claim.(a) Every taxpayer claiming a credit under this section shall
7.22supply to the commissioner of revenue, in support of the claim, proof of eligibility under
7.23this section, including but not limited to amount of rent paid, name and address of owner
7.24or managing agent of property rented, changes in household membership, and household
7.25income.
7.26 (b) Taxpayers with a disability shall submit proof of disability in the form and manner
7.27as the commissioner prescribes. The department may require examination and certification
7.28by the taxpayer's physician or by a physician designated by the commissioner. The cost of
7.29any examination shall be borne by the taxpayer, unless the examination proves the disability,
7.30in which case the cost of the examination shall be borne by the commissioner.
7.31 (c) A determination of disability of a taxpayer by the Social Security Administration
7.32under Title II or Title XVI of the Social Security Act shall constitute presumptive proof of
7.33disability.
7Sec. 5.
23-00701 as introduced12/21/22 REVISOR EAP/NB 8.1 Subd. 10.No relief allowed in certain cases.No claim for a credit under this section
8.2shall be allowed if the commissioner determines that the claimant received tenancy to the
8.3homestead primarily for the purpose of receiving a credit under this section and not for bona
8.4fide residence purposes.
8.5 Subd. 11.Appropriation.The amount necessary to pay the refunds under this section
8.6is appropriated from the general fund to the commissioner.
8.7 Subd. 12.Simplified filing for individuals without an income tax liability.The
8.8commissioner of revenue must establish a simplified filing process through which a taxpayer
8.9who did not file an individual income tax return due to a lack of tax liability may file a
8.10return to claim the credit under this section. The filing process and forms may be in the
8.11form or manner determined by the commissioner, but must be designed to reduce the
8.12complexity of the filing process and the time needed to file for individuals without an income
8.13tax liability.
8.14 EFFECTIVE DATE.This section is effective for taxable years beginning after December
8.1531, 2022.
8.16 Sec. 6. Minnesota Statutes 2022, section 290A.02, is amended to read:
8.17 290A.02 PURPOSE.
8.18 The purpose of this chapter is to provide property tax relief to certain persons who own
8.19or rent their homesteads.
8.20 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
8.21and following years.
8.22 Sec. 7. Minnesota Statutes 2022, section 290A.03, subdivision 3, is amended to read:
8.23 Subd. 3.Income.(a) "Income" means the sum of the following:
8.24 (1) federal adjusted gross income as defined in the Internal Revenue Code; and
8.25 (2) the sum of the following amounts to the extent not included in clause (1):
8.26 (i) all nontaxable income;
8.27 (ii) the amount of a passive activity loss that is not disallowed as a result of section 469,
8.28paragraph (i) or (m) of the Internal Revenue Code and the amount of passive activity loss
8.29carryover allowed under section 469(b) of the Internal Revenue Code;
8Sec. 7.
23-00701 as introduced12/21/22 REVISOR EAP/NB 9.1 (iii) an amount equal to the total of any discharge of qualified farm indebtedness of a
9.2solvent individual excluded from gross income under section 108(g) of the Internal Revenue
9.3Code;
9.4 (iv) cash public assistance and relief;
9.5 (v) any pension or annuity (including railroad retirement benefits, all payments received
9.6under the federal Social Security Act, Supplemental Security Income, and veterans benefits),
9.7which was not exclusively funded by the claimant or spouse, or which was funded exclusively
9.8by the claimant or spouse and which funding payments were excluded from federal adjusted
9.9gross income in the years when the payments were made;
9.10 (vi) interest received from the federal or a state government or any instrumentality or
9.11political subdivision thereof;
9.12 (vii) workers' compensation;
9.13 (viii) nontaxable strike benefits;
9.14 (ix) the gross amounts of payments received in the nature of disability income or sick
9.15pay as a result of accident, sickness, or other disability, whether funded through insurance
9.16or otherwise;
9.17 (x) a lump-sum distribution under section 402(e)(3) of the Internal Revenue Code of
9.181986, as amended through December 31, 1995;
9.19 (xi) contributions made by the claimant to an individual retirement account, including
9.20a qualified voluntary employee contribution; simplified employee pension plan;
9.21self-employed retirement plan; cash or deferred arrangement plan under section 401(k) of
9.22the Internal Revenue Code; or deferred compensation plan under section 457 of the Internal
9.23Revenue Code, to the extent the sum of amounts exceeds the retirement base amount for
9.24the claimant and spouse;
9.25 (xii) to the extent not included in federal adjusted gross income, distributions received
9.26by the claimant or spouse from a traditional or Roth style retirement account or plan;
9.27 (xiii) nontaxable scholarship or fellowship grants;
9.28 (xiv) alimony received to the extent not included in the recipient's income;
9.29 (xv) the amount of deduction allowed under section 220 or 223 of the Internal Revenue
9.30Code;
9.31 (xvi) the amount deducted for tuition expenses under section 222 of the Internal Revenue
9.32Code; and
9Sec. 7.
23-00701 as introduced12/21/22 REVISOR EAP/NB 10.1 (xvii) the amount deducted for certain expenses of elementary and secondary school
10.2teachers under section 62(a)(2)(D) of the Internal Revenue Code.
10.3 In the case of an individual who files an income tax return on a fiscal year basis, the
10.4term "federal adjusted gross income" shall mean federal adjusted gross income reflected in
10.5the fiscal year ending in the calendar year. Federal adjusted gross income shall not be reduced
10.6by the amount of a net operating loss carryback or carryforward or a capital loss carryback
10.7or carryforward allowed for the year.
10.8 (b) "Income" does not include:
10.9 (1) amounts excluded pursuant to the Internal Revenue Code, sections 101(a) and 102;
10.10 (2) amounts of any pension or annuity which was exclusively funded by the claimant
10.11or spouse and which funding payments were not excluded from federal adjusted gross
10.12income in the years when the payments were made;
10.13 (3) to the extent included in federal adjusted gross income, amounts contributed by the
10.14claimant or spouse to a traditional or Roth style retirement account or plan, but not to exceed
10.15the retirement base amount reduced by the amount of contributions excluded from federal
10.16adjusted gross income, but not less than zero;
10.17 (4) surplus food or other relief in kind supplied by a governmental agency;
10.18 (5) relief granted under this chapter;
10.19 (6) child support payments received under a temporary or final decree of dissolution or
10.20legal separation;
10.21 (7) restitution payments received by eligible individuals and excludable interest as
10.22defined in section 803 of the Economic Growth and Tax Relief Reconciliation Act of 2001,
10.23Public Law 107-16;
10.24 (8) alimony paid; or
10.25 (9) veterans disability compensation paid under title 38 of the United States Code.
10.26 (c) The sum of the following amounts may be subtracted from income:
10.27 (1) for the claimant's first dependent, the exemption amount multiplied by 1.4;
10.28 (2) for the claimant's second dependent, the exemption amount multiplied by 1.3;
10.29 (3) for the claimant's third dependent, the exemption amount multiplied by 1.2;
10.30 (4) for the claimant's fourth dependent, the exemption amount multiplied by 1.1;
10Sec. 7.
23-00701 as introduced12/21/22 REVISOR EAP/NB 11.1 (5) for the claimant's fifth dependent, the exemption amount; and
11.2 (6) if the claimant or claimant's spouse had a disability or attained the age of 65 on or
11.3before December 31 of the year for which the taxes were levied or rent paid, the exemption
11.4amount.
11.5 (d) For purposes of this subdivision, the following terms have the meanings given:
11.6 (1) "exemption amount" means the exemption amount under section 290.0121,
11.7subdivision 1, paragraph (b), for the taxable year for which the income is reported;
11.8 (2) "retirement base amount" means the deductible amount for the taxable year for the
11.9claimant and spouse under section 219(b)(5)(A) of the Internal Revenue Code, adjusted for
11.10inflation as provided in section 219(b)(5)(C) of the Internal Revenue Code, without regard
11.11to whether the claimant or spouse claimed a deduction; and
11.12 (3) "traditional or Roth style retirement account or plan" means retirement plans under
11.13sections 401, 403, 408, 408A, and 457 of the Internal Revenue Code.
11.14 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
11.15and following years.
11.16Sec. 8. Minnesota Statutes 2022, section 290A.03, subdivision 6, is amended to read:
11.17 Subd. 6.Homestead."Homestead" means the dwelling occupied as the claimant's
11.18principal residence and so much of the land surrounding it, not exceeding ten acres, as is
11.19reasonably necessary for use of the dwelling as a home and any other property used for
11.20purposes of a homestead as defined in section 273.13, subdivision 22, except for agricultural
11.21land assessed as part of a homestead pursuant to section 273.13, subdivision 23, "homestead"
11.22is limited to the house and garage and immediately surrounding one acre of land. The
11.23homestead may be owned or rented and may be as a part of a multidwelling or multipurpose
11.24building and the land on which it is built. A manufactured home, as defined in section
11.25273.125, subdivision 8, or a park trailer taxed as a manufactured home under section 168.012,
11.26subdivision 9, assessed as personal property may be a dwelling for purposes of this
11.27subdivision.
11.28 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
11.29and following years.
11Sec. 8.
23-00701 as introduced12/21/22 REVISOR EAP/NB 12.1 Sec. 9. Minnesota Statutes 2022, section 290A.03, subdivision 8, is amended to read:
12.2 Subd. 8.Claimant.(a) "Claimant" means a person, other than a dependent, as defined
12.3under sections 151 and 152 of the Internal Revenue Code disregarding section 152(b)(3)
12.4of the Internal Revenue Code, who filed a claim authorized by this chapter and who was a
12.5resident of this state as provided in chapter 290 during the calendar year for which the claim
12.6for relief was filed.
12.7 (b) In the case of a claim relating to rent constituting property taxes, the claimant shall
12.8have resided in a rented or leased unit on which ad valorem taxes or payments made in lieu
12.9of ad valorem taxes, including payments of special assessments imposed in lieu of ad valorem
12.10taxes, are payable at some time during the calendar year covered by the claim.
12.11 (c) "Claimant" shall not include a resident of a nursing home, intermediate care facility,
12.12long-term residential facility, or a facility that accepts housing support payments whose
12.13rent constituting property taxes is paid pursuant to the Supplemental Security Income
12.14program under title XVI of the Social Security Act, the Minnesota supplemental aid program
12.15under sections 256D.35 to 256D.54, the medical assistance program pursuant to title XIX
12.16of the Social Security Act, or the housing support program under chapter 256I.
12.17 If only a portion of the rent constituting property taxes is paid by these programs, the
12.18resident shall be a claimant for purposes of this chapter, but the refund calculated pursuant
12.19to section 290A.04 shall be multiplied by a fraction, the numerator of which is income as
12.20defined in subdivision 3, paragraphs (a) and (b), reduced by the total amount of income
12.21from the above sources other than vendor payments under the medical assistance program
12.22and the denominator of which is income as defined in subdivision 3, paragraphs (a) and (b),
12.23plus vendor payments under the medical assistance program, to determine the allowable
12.24refund pursuant to this chapter.
12.25 (d) Notwithstanding paragraph (c), if the claimant was a resident of the nursing home,
12.26intermediate care facility, long-term residential facility, or facility for which the rent was
12.27paid for the claimant by the housing support program for only a portion of the calendar year
12.28covered by the claim, the claimant may compute rent constituting property taxes by
12.29disregarding the rent constituting property taxes from the nursing home or facility and use
12.30only that amount of rent constituting property taxes or property taxes payable relating to
12.31that portion of the year when the claimant was not in the facility. The claimant's household
12.32income is the income for the entire calendar year covered by the claim.
12.33 (e) In the case of a claim for rent constituting property taxes of a part-year Minnesota
12.34resident, the income and rent reflected in this computation shall be for the period of
12Sec. 9.
23-00701 as introduced12/21/22 REVISOR EAP/NB 13.1Minnesota residency only. Any rental expenses paid which may be reflected in arriving at
13.2federal adjusted gross income cannot be utilized for this computation. When two individuals
13.3of a household are able to meet the qualifications for a claimant, they may determine among
13.4them as to who the claimant shall be. If they are unable to agree, the matter shall be referred
13.5to the commissioner of revenue whose decision shall be final. If a homestead property owner
13.6was a part-year Minnesota resident, the income reflected in the computation made pursuant
13.7to section 290A.04 shall be for the entire calendar year, including income not assignable to
13.8Minnesota.
13.9 (f) If a homestead is occupied by two or more renters, who are not married to each other,
13.10the rent shall be deemed to be paid equally by each, and separate claims shall be filed by
13.11each. The income of each shall be each renter's household income for purposes of computing
13.12the amount of credit to be allowed.
13.13 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
13.14and following years.
13.15Sec. 10. Minnesota Statutes 2022, section 290A.03, subdivision 12, is amended to read:
13.16 Subd. 12.Gross rent.(a) "Gross rent" means rent paid for the right of occupancy, at
13.17arm's length, of a site on which a homestead, exclusive of charges for any medical services
13.18furnished by the landlord as a part of the rental agreement, whether expressly set out in the
13.19rental agreement or not which is a manufactured home as defined in section 273.125,
13.20subdivision 8, including a manufactured home located in a manufactured home community
13.21owned by a cooperative organized under chapter 308A or 308B, and park trailers taxed as
13.22manufactured homes under section 168.012, subdivision 9, is located.
13.23 (b) The gross rent of a resident of a nursing home or intermediate care facility is $500
13.24per month. The gross rent of a resident of an adult foster care home is $780 per month. The
13.25commissioner shall annually adjust the amounts in this paragraph as provided in section
13.26270C.22. The statutory year is 2018.
13.27 (c) (b) If the landlord and tenant have not dealt with each other at arm's length and the
13.28commissioner determines that the gross rent charged was excessive, the commissioner may
13.29adjust the gross rent to a reasonable amount for purposes of this chapter.
13.30 (d) (c) Any amount paid by a claimant residing in property assessed pursuant to section
13.31273.124, subdivision 3, 4, 5, or 6 for occupancy in that property shall be excluded from
13.32gross rent for purposes of this chapter. However, property taxes imputed to the homestead
13.33of the claimant or the dwelling unit occupied by the claimant that qualifies for homestead
13Sec. 10.
23-00701 as introduced12/21/22 REVISOR EAP/NB 14.1treatment pursuant to section 273.124, subdivision 3, 4, 5, or 6 shall be included within the
14.2term "property taxes payable" as defined in subdivision 13, to the extent allowed,
14.3notwithstanding the fact that ownership is not in the name of the claimant.
14.4 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
14.5and following years.
14.6 Sec. 11. Minnesota Statutes 2022, section 290A.04, subdivision 1, is amended to read:
14.7 Subdivision 1.Refund.A refund shall be allowed each claimant in the amount that
14.8property taxes payable or rent constituting property taxes exceed the percentage of the
14.9household income of the claimant specified in subdivision 2 or 2a in the year for which the
14.10taxes were levied or in the year in which the rent was paid as specified in subdivision 2 or
14.112a. If the amount of property taxes payable or rent constituting property taxes is equal to
14.12or less than the percentage of the household income of the claimant specified in subdivision
14.132 or 2a in the year for which the taxes were levied or in the year in which the rent was paid,
14.14the claimant shall not be eligible for a state refund pursuant to this section.
14.15 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
14.16and following years.
14.17Sec. 12. Minnesota Statutes 2022, section 290A.05, is amended to read:
14.18 290A.05 COMBINED HOUSEHOLD INCOME; RENTAL AGREEMENTS AND
14.19REDUCTION OF PROPERTY TAXES PAYABLE.
14.20 (a) If a person occupies a homestead with another person not related to the person as
14.21the person's spouse, excluding dependents, roomers or boarders on contract, and has property
14.22tax payable with respect to the homestead, the household income of the claimant or claimants
14.23for the purpose of computing the refund allowed by section 290A.04 shall include the total
14.24income received by the other persons residing in the homestead. For purposes of this section,
14.25"dependent" includes a parent of the claimant or spouse who lives in the claimant's homestead
14.26and does not have an ownership interest in the homestead.
14.27 (b) If a person occupies a homestead with another person or persons not related to the
14.28person as the person's spouse or as dependents, the property tax payable or rent constituting
14.29property tax shall be reduced as follows.
14.30 If and the other person or persons are residing at the homestead under a rental or lease
14.31agreement with the homeowner, the amount of property tax payable or rent constituting
14.32property tax shall be equals that portion not covered by the rental agreement.
14Sec. 12.
23-00701 as introduced12/21/22 REVISOR EAP/NB 15.1 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
15.2and property taxes payable in 2024, and following years.
15.3 Sec. 13. Minnesota Statutes 2022, section 290A.07, subdivision 2a, is amended to read:
15.4 Subd. 2a.Time of payment to renter or manufactured home homeowner.A claimant
15.5who is a renter or a homeowner who occupies a manufactured home, as defined in section
15.6273.125, subdivision 8, paragraph (c), or a park trailer taxed as a manufactured home under
15.7section 168.012, subdivision 9, shall receive full payment after August 1 and before August
15.815 or 60 days after receipt of the application, whichever is later.
15.9 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
15.10and following years.
15.11Sec. 14. Minnesota Statutes 2022, section 290A.08, is amended to read:
15.12 290A.08 ONE CLAIMANT PER HOUSEHOLD.
15.13 Only one claimant per household per year is entitled to relief under this chapter. Payment
15.14of the claim for relief may be made payable to the spouses as one claimant. The
15.15commissioner, upon written request, may issue separate checks, to the spouses for one-half
15.16of the relief provided the original check has not been issued or has been returned. Individuals
15.17related as spouses who were married during the year may elect to file a joint claim which
15.18shall include each spouse's income, rent constituting property taxes, and property taxes
15.19payable. Spouses who were married for the entire year and were domiciled in the same
15.20household for the entire year must file a joint claim. The maximum dollar amount allowable
15.21for a joint claim shall not exceed the amount that one person could receive.
15.22 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
15.23and following years.
15.24Sec. 15. Minnesota Statutes 2022, section 290A.09, is amended to read:
15.25 290A.09 PROOF OF CLAIM.
15.26 Every claimant shall supply to the commissioner of revenue, in support of the claim,
15.27proof of eligibility under this chapter, including but not limited to amount of rent paid or
15.28property taxes accrued, name and address of owner or managing agent of property rented,
15.29changes in homestead, household membership, household income, size and nature of property
15.30claimed as a homestead.
15Sec. 15.
23-00701 as introduced12/21/22 REVISOR EAP/NB 16.1 Persons with a disability filing claims shall submit proof of disability in the form and
16.2manner as the commissioner may prescribe. The department may require examination and
16.3certification by the claimant's physician or by a physician designated by the commissioner.
16.4The cost of any examination shall be borne by the claimant, unless the examination proves
16.5the disability, in which case the cost of the examination shall be borne by the commissioner.
16.6 A determination of disability of a claimant by the Social Security Administration under
16.7Title II or Title XVI of the Social Security Act shall constitute presumptive proof of disability.
16.8 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
16.9and following years.
16.10Sec. 16. Minnesota Statutes 2022, section 290A.091, is amended to read:
16.11 290A.091 CLAIMS OF TENANTS IN LEASEHOLD COOPERATIVES.
16.12 The cooperative manager of a leasehold cooperative shall furnish a statement to each
16.13tenant by March 31 of the year in which the property tax is payable showing each unit's
16.14share of the gross property tax and each unit's share of any property tax credits. Each tenant
16.15may apply for a property tax refund under this chapter as a homeowner based on each
16.16tenant's share of property taxes. The tenant may not include any rent constituting property
16.17taxes paid on that unit claim the renter's credit under section 290.0693. For the purposes of
16.18this section, a leasehold cooperative is formed on the day that leasehold cooperative status
16.19is granted by the appropriate county official.
16.20 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
16.21and following years.
16.22Sec. 17. Minnesota Statutes 2022, section 290A.13, is amended to read:
16.23 290A.13 NO RELIEF ALLOWED IN CERTAIN CASES.
16.24 No claim for relief under this chapter shall be allowed if the commissioner determines
16.25that the claimant received title or tenancy to the homestead primarily for the purpose of
16.26receiving benefits under this chapter and not for bona fide residence purposes.
16.27 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
16.28and following years.
16Sec. 17.
23-00701 as introduced12/21/22 REVISOR EAP/NB 17.1 Sec. 18. Minnesota Statutes 2022, section 290A.19, is amended to read:
17.2 290A.19 OWNER OR MANAGING AGENT TO FURNISH RENT CERTIFICATE.
17.3 (a) The park owner or managing agent of any of a property for which rent is paid for
17.4occupancy as a homestead must furnish a certificate of rent paid to a person who is a renter
17.5on December 31, in the form prescribed by the commissioner. If the renter moves before
17.6December 31, the park owner or managing agent may give the certificate to the renter at
17.7the time of moving, or mail the certificate to the forwarding address if an address has been
17.8provided by the renter. The certificate must be made available to the renter before February
17.91 of the year following the year in which the rent was paid. The park owner or managing
17.10agent must retain a duplicate of each certificate or an equivalent record showing the same
17.11information for a period of three years. The duplicate or other record must be made available
17.12to the commissioner upon request.
17.13 (b) The commissioner may require the park owner or managing agent, through a simple
17.14process, to furnish to the commissioner on or before March 1 a copy of each certificate of
17.15rent paid furnished to a renter for rent paid in the prior year. The commissioner shall prescribe
17.16the content, format, and manner of the form pursuant to section 270C.30. Prior to
17.17implementation, the commissioner, after consulting with representatives of park owners or
17.18managing agents, shall develop an implementation and administration plan for the
17.19requirements of this paragraph that attempts to minimize financial burdens, administration
17.20and compliance costs, and takes into consideration existing systems of park owners and
17.21managing agents.
17.22 (c) For the purposes of this section, "owner" includes "park owner" means a park owner
17.23as defined under section 327C.015, subdivision 9, and "property" includes a lot as defined
17.24under section 327C.015, subdivision 6.
17.25 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
17.26and following years.
17.27Sec. 19. Minnesota Statutes 2022, section 290A.25, is amended to read:
17.28 290A.25 VERIFICATION OF SOCIAL SECURITY NUMBERS.
17.29 Annually, the commissioner of revenue shall furnish a list to the county assessor
17.30containing the names and Social Security numbers of persons who have applied for both
17.31homestead classification under section 273.13 and a property tax refund as a renter under
17.32this chapter renter's credit under section 290.0693.
17Sec. 19.
23-00701 as introduced12/21/22 REVISOR EAP/NB 18.1 Within 90 days of the notification, the county assessor shall investigate to determine if
18.2the homestead classification was improperly claimed. If the property owner does not qualify,
18.3the county assessor shall notify the county auditor who will determine the amount of
18.4homestead benefits that has been improperly allowed. For the purpose of this section,
18.5"homestead benefits" has the meaning given in section 273.124, subdivision 13b. The county
18.6auditor shall send a notice to persons who owned the affected property at the time the
18.7homestead application related to the improper homestead was filed, demanding
18.8reimbursement of the homestead benefits plus a penalty equal to 100 percent of the homestead
18.9benefits. The person notified may appeal the county's determination with the Minnesota
18.10Tax Court within 60 days of the date of the notice from the county as provided in section
18.11273.124, subdivision 13b.
18.12 If the amount of homestead benefits and penalty is not paid within 60 days, and if no
18.13appeal has been filed, the county auditor shall certify the amount of taxes and penalty to
18.14the county treasurer. The county treasurer will add interest to the unpaid homestead benefits
18.15and penalty amounts at the rate provided for delinquent personal property taxes for the
18.16period beginning 60 days after demand for payment was made until payment. If the person
18.17notified is the current owner of the property, the treasurer may add the total amount of
18.18benefits, penalty, interest, and costs to the real estate taxes otherwise payable on the property
18.19in the following year. If the person notified is not the current owner of the property, the
18.20treasurer may collect the amounts due under the Revenue Recapture Act in chapter 270A,
18.21or use any of the powers granted in sections 277.20 and 277.21 without exclusion, to enforce
18.22payment of the benefits, penalty, interest, and costs, as if those amounts were delinquent
18.23tax obligations of the person who owned the property at the time the application related to
18.24the improperly allowed homestead was filed. The treasurer may relieve a prior owner of
18.25personal liability for the benefits, penalty, interest, and costs, and instead extend those
18.26amounts on the tax lists against the property for taxes payable in the following year to the
18.27extent that the current owner agrees in writing.
18.28 Any amount of homestead benefits recovered by the county from the property owner
18.29shall be distributed to the county, city or town, and school district where the property is
18.30located in the same proportion that each taxing district's levy was to the total of the three
18.31taxing districts' levy for the current year. Any amount recovered attributable to taconite
18.32homestead credit shall be transmitted to the St. Louis County auditor to be deposited in the
18.33taconite property tax relief account. Any amount recovered that is attributable to supplemental
18.34homestead credit is to be transmitted to the commissioner of revenue for deposit in the
18Sec. 19.
23-00701 as introduced12/21/22 REVISOR EAP/NB 19.1general fund of the state treasury. The total amount of penalty collected must be deposited
19.2in the county general fund.
19.3 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
19.4and following years.
19.5 Sec. 20. Minnesota Statutes 2022, section 462A.05, subdivision 24, is amended to read:
19.6 Subd. 24.Housing for elderly, persons with physical or developmental disabilities,
19.7and single parent families.(a) It may engage in housing programs for low- and
19.8moderate-income elderly, persons with physical or developmental disabilities, or single
19.9parent families in the case of home sharing programs, as defined by the agency, to provide
19.10grants or loans, with or without interest, for:
19.11 (1) accessibility improvements to residences occupied by elderly persons;
19.12 (2) housing sponsors, as defined by the agency, of home sharing programs to match
19.13existing homeowners with prospective tenants who will contribute either rent or services
19.14to the homeowner, where either the homeowner or the prospective tenant is elderly, a person
19.15with physical or developmental disabilities, or the head of a single parent family;
19.16 (3) the construction of or conversion of existing buildings into structures for occupancy
19.17by the elderly that contain from three to 12 private sleeping rooms with shared cooking
19.18facilities and common space; and
19.19 (4) housing sponsors, as defined by the agency, to demonstrate the potential for home
19.20equity conversion in Minnesota for the elderly, in both rural and urban areas, and to determine
19.21the need in those equity conversions for consumer safeguards.
19.22 (b) In making the grants or loans, the agency shall determine the terms and conditions
19.23of repayment and the appropriate security, if any, should repayment be required. The agency
19.24may provide technical assistance to sponsors of home sharing programs or may contract or
19.25delegate the provision of the technical assistance in accordance with section 462A.07,
19.26subdivision 12.
19.27 (c) Housing sponsors who receive funding through these programs shall provide
19.28homeowners and tenants participating in a home sharing program with information regarding
19.29their rights and obligations as they relate to federal and state tax law including, but not
19.30limited to, taxable rental income, homestead classification under chapter 273, the renter's
19.31credit under section 290.0693, and the property tax refund act under chapter 290A.
19Sec. 20.
23-00701 as introduced12/21/22 REVISOR EAP/NB 20.1 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
20.2and following years.
20.3 Sec. 21. REPEALER.
20.4 Minnesota Statutes 2022, sections 290A.03, subdivisions 9 and 11; 290A.04, subdivisions
20.52a and 5; and 290A.23, subdivision 1, are repealed.
20.6 EFFECTIVE DATE.This section is effective for claims based on rent paid in 2023
20.7and following years.
20Sec. 21.
23-00701 as introduced12/21/22 REVISOR EAP/NB 290A.03 DEFINITIONS.
Subd. 9.Disabled claimant."Disabled claimant" means any claimant who has a disability.
Subd. 11.Rent constituting property taxes."Rent constituting property taxes" means 17
percent of the gross rent actually paid in cash, or its equivalent, or the portion of rent paid in lieu
of property taxes, in any calendar year by a claimant for the right of occupancy of the claimant's
Minnesota homestead in the calendar year, and which rent constitutes the basis, in the succeeding
calendar year of a claim for relief under this chapter by the claimant.
290A.04 REFUND ALLOWABLE.
Subd. 2a.Renters.A claimant whose rent constituting property taxes exceeds the percentage
of the household income stated below must pay an amount equal to the percent of income shown
for the appropriate household income level along with the percent to be paid by the claimant of the
remaining amount of rent constituting property taxes. The state refund equals the amount of rent
constituting property taxes that remain, up to the maximum state refund amount shown below.
Maximum
State
Refund
Percent Paid by
ClaimantPercent of IncomeHousehold Income
2,150$5 percent1.0 percent$0 to 5,269
2,150$10 percent1.0 percent5,270 to 6,999
2,090$10 percent1.1 percent7,000 to 8,749
2,040$10 percent1.2 percent8,750 to 12,269
1,980$15 percent1.3 percent12,270 to 15,779
1,930$15 percent1.4 percent15,780 to 17,519
1,880$20 percent1.4 percent17,520 to 19,259
1,820$20 percent1.5 percent19,260 to 22,779
1,770$20 percent1.6 percent22,780 to 24,529
1,770$25 percent1.7 percent24,530 to 26,279
1,770$25 percent1.8 percent26,280 to 29,789
1,770$30 percent1.9 percent29,790 to 31,529
1,770$30 percent2.0 percent31,530 to 36,789
1,770$35 percent2.0 percent36,790 to 42,039
1,770$40 percent2.0 percent42,040 to 49,059
1,610$45 percent2.0 percent49,060 to 50,799
1,450$45 percent2.0 percent50,800 to 52,559
1,230$45 percent2.0 percent52,560 to 54,319
1,070$50 percent2.0 percent54,320 to 56,059
970$50 percent2.0 percent56,060 to 57,819
540$50 percent2.0 percent57,820 to 59,569
210$50 percent2.0 percent59,570 to 61,319
The payment made to a claimant is the amount of the state refund calculated under this
subdivision. No payment is allowed if the claimant's household income is $61,320 or more.
Subd. 5.Combined renter and homeowner refund.In the case of a claimant who is entitled
to a refund in a calendar year for claims based both on rent constituting property taxes and property
taxes payable, the refund allowable equals the sum of the refunds allowable.
1R
APPENDIX
Repealed Minnesota Statutes: 23-00701 290A.23 APPROPRIATION.
Subdivision 1.Renters credit.There is appropriated from the general fund in the state treasury
to the commissioner of revenue the amount necessary to make the payments required under section
290A.04, subdivision 2a.
2R
APPENDIX
Repealed Minnesota Statutes: 23-00701