1.1 A bill for an act
1.2 relating to taxation; property; increasing the shareholder limit for entity-owned
1.3 agricultural property; amending Minnesota Statutes 2024, section 273.124,
1.4 subdivision 8.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. Minnesota Statutes 2024, section 273.124, subdivision 8, is amended to read:
1.7 Subd. 8.Homestead owned by or leased to family farm corporation, joint farm
1.8venture, limited liability company, or partnership.(a) Each family farm corporation;
1.9each joint family farm venture; and each limited liability company or partnership which
1.10operates a family farm; is entitled to class 1b under section 273.13, subdivision 22, paragraph
1.11(b), or class 2a assessment for one homestead occupied by a shareholder, member, or partner
1.12thereof who is residing on the land, and actively engaged in farming of the land owned by
1.13the family farm corporation, joint family farm venture, limited liability company, or
1.14partnership. Homestead treatment applies even if:
1.15 (1) legal title to the property is in the name of the family farm corporation, joint family
1.16farm venture, limited liability company, or partnership, and not in the name of the person
1.17residing on it; or
1.18 (2) the family farm is operated by a family farm corporation, joint family farm venture,
1.19partnership, or limited liability company other than the family farm corporation, joint family
1.20farm venture, partnership, or limited liability company that owns the land, provided that:
1.21 (i) the shareholder, member, or partner residing on and actively engaged in farming the
1.22land is a shareholder, member, or partner of the family farm corporation, joint family farm
1.23venture, partnership, or limited liability company that is operating the farm; and
1Section 1.
REVISOR MS/NS 25-0466603/07/25
State of Minnesota
This Document can be made available
in alternative formats upon request
HOUSE OF REPRESENTATIVES
H. F. No. 2539
NINETY-FOURTH SESSION
Authored by Swedzinski03/20/2025
The bill was read for the first time and referred to the Committee on Taxes 2.1 (ii) more than half of the shareholders, members, or partners of each family farm
2.2corporation, joint family farm venture, partnership, or limited liability company are persons
2.3or spouses of persons who are a qualifying relative under section 273.124, subdivision 1,
2.4paragraphs (c) and (d).
2.5 "Family farm corporation," "family farm," and "partnership operating a family farm"
2.6have the meanings given in section 500.24, except that the number of allowable provided
2.7that all shareholders, members, or partners under this subdivision shall not exceed 12 are
2.8related by blood or marriage. "Limited liability company" has the meaning contained in
2.9sections 322C.0102, subdivision 12, and 500.24, subdivision 2, paragraphs (l) and (m).
2.10"Joint family farm venture" means a cooperative agreement among two or more farm
2.11enterprises authorized to operate a family farm under section 500.24.
2.12 (b) In addition to property specified in paragraph (a), any other residences owned by
2.13family farm corporations, joint family farm ventures, limited liability companies, or
2.14partnerships described in paragraph (a) which are located on agricultural land and occupied
2.15as homesteads by its shareholders, members, or partners who are actively engaged in farming
2.16on behalf of that corporation, joint farm venture, limited liability company, or partnership
2.17must also be assessed as class 2a property or as class 1b property under section 273.13.
2.18 (c) Agricultural property that is owned by a member, partner, or shareholder of a family
2.19farm corporation or joint family farm venture, limited liability company operating a family
2.20farm, or by a partnership operating a family farm and leased to the family farm corporation,
2.21limited liability company, partnership, or joint farm venture, as defined in paragraph (a), is
2.22eligible for classification as class 1b or class 2a under section 273.13, if the owner is actually
2.23residing on the property, and is actually engaged in farming the land on behalf of that
2.24corporation, joint farm venture, limited liability company, or partnership. This paragraph
2.25applies without regard to any legal possession rights of the family farm corporation, joint
2.26family farm venture, limited liability company, or partnership under the lease.
2.27 (d) Nonhomestead agricultural property that is owned by a family farm corporation,
2.28joint farm venture, limited liability company, or partnership; and located not farther than
2.29four townships or cities, or combination thereof, from agricultural land that is owned, and
2.30used for the purposes of a homestead by an individual who is a shareholder, member, or
2.31partner of the corporation, venture, company, or partnership; is entitled to receive the first
2.32tier homestead classification rate on any remaining market value in the first homestead class
2.33tier that is in excess of the market value of the shareholder's, member's, or partner's class 2
2.34agricultural homestead property, if the owner, or someone acting on the owner's behalf
2.35notifies the county assessor by July 1 that the property may be eligible under this paragraph
2Section 1.
REVISOR MS/NS 25-0466603/07/25 3.1for the current assessment year, for taxes payable in the following year. As used in this
3.2paragraph, "agricultural property" means property classified as 2a under section 273.13,
3.3along with any contiguous property classified as 2b under section 273.13, if the contiguous
3.42a and 2b properties are under the same ownership.
3.5 EFFECTIVE DATE.This section is effective for homestead applications in 2025 and
3.6thereafter.
3Section 1.
REVISOR MS/NS 25-0466603/07/25