Homeowners Get Property Tax Rebate Under Governor's Proposal

Under the proposal, all Minnesota homeowners would receive a maximum property tax rebate of $500.
(Published Jan 28, 2013)

Within his budget recommendations for property tax aids and credits, Gov. Dayton is proposing a new property tax rebate for all Minnesota homesteads. The property tax rebate is the largest property tax relief initiative contained in the governor’s 2014-2015 budget proposal, released Jan. 22.

The homeowner property tax rebate equals the lesser of $500 or 100 percent of the homestead's previous-year property tax bill. According to the budget document, there are approximately 1.5 million homesteads in Minnesota, and an estimated 95 percent of those homesteads would receive the maximum $500 rebate. The other 5 percent of eligible homeowners would have 100 percent of their previous year’s property tax bill paid via the state rebate.

Note that the homeowner property tax rebate proposal does not repeal the existing homestead market value exclusion program, nor is there any linkage to the existing homeowner property tax refund (PTR) program. A homeowner eligible for the new rebate would still be eligible for the full PTR refund.

Homeowners would be required to apply for the property tax rebate when filing their Minnesota personal income tax return, and homeowners who do not otherwise file an income tax return would need to file to receive the rebate.

The rebate will first be available with the income tax returns for the 2013 tax year, which are filed in calendar year 2014, and the first year rebate will be based on 2013 property taxes paid. The rebate would become a permanent feature of the Minnesota tax system and would result in an estimated $718.4 million rebate in the first year.

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