Each year, as much as $25 million in property tax refunds goes unclaimed by Ramsey County residents, according to the Minnesota Department of Revenue. That’s a lot of money to be leaving on the table.
Ramsey County recently sent out proposed property tax statements for next year. If you’re looking for relief, here’s a list of multiple refunds homeowners can look into. Don’t live in Ramsey County? Check with your county assessor, and visit the state Department of Revenue property tax website at revenue.state.mn.us/property-taxes.
HOMESTEAD CREDITS: Homeowners who have declared a house to be their homestead, or primary residence, can receive an annual property tax credit of up to $2,840 from the state of Minnesota, as long as their household income is below $116,180. The average refund is $1,132. To declare your home your homestead, visit the county’s website at tinyurl.com/HomesteadRamCO for an application, which must be submitted to the county with a copy of your deed, including the legal description. Depending on your living situation, you may have to submit additional forms, such as a copy of your Certificate of Real Estate Value if you purchased your property in the last three months. The state provides more information on the homestead market value exclusion online at tinyurl.com/HomesteadMN.
SPECIAL REFUNDS: Another commonly-overlooked benefit is a special homestead credit that the state offers to anyone whose property taxes go up more than 12 percent and $100 in a single year, regardless of household income. The special refund is 60 percent of the amount of tax paid that exceeds the 12 percent increase, up to $1,000. It generally runs between $81 and $162 and can be requested on top of the traditional homestead credit. The property tax increase cannot be the result of home improvements. Look for “special property tax refund” instructions on your state property tax Form M1PR. More information is online at tinyurl.com/HomesteadMN.
BLIND OR PERMANENTLY AND TOTALLY DISABLED: State law allows a reduced property tax rate for blind or permanently and totally disabled property owners who homestead their property. File an application with the county assessor’s office. Visit the county website at tinyurl.com/HomesteadRamCO for instructions on homesteading for the disabled.
TAX EXCLUSION FOR DISABLED VETERANS: This program provides a property tax exclusion for the homestead of an honorably discharged veteran who has a service-connected disability rating of 70 percent or higher. Surviving spouses of certain qualifying veterans and service members, as well as primary family caregivers of qualifying veterans are also eligible. Depending upon your status, the market value exclusion allows you to deduct either $150,000 or $300,000 from the value of your home when calculating property taxes. Documentation must be filed with your county homestead application. See tinyurl.com/HomesteadRamCO.
RENTERS CREDIT: Renters pay “implicit” property taxes too, and that means they could be eligible for money back. The renter’s property tax refund program — sometimes called the renter’s credit — is a state-paid refund for low- to moderate-income renters. Renters whose household income exceeds $62,960 are not eligible, though deductions are allowed for dependents, seniors and the disabled. To calculate refunds, “rent constituting property taxes” is assumed to equal 17 percent of rent paid. If that figure exceeds a certain percentage of income, the refund kicks back a percentage of the tax over that threshold. In other words, as income increases, the maximum refund decreases. For refund claims filed in 2021, based on rent paid in 2020 as well as 2020 household income, the maximum refund was $2,210. The average refund was $690, or $761 for seniors and the disabled. Refund claims are filed using state property tax Form M1PR. For more information, visit tinyurl.com/RenterCredit2021.
SENIOR DEFERRAL: Seniors whose household income is $60,000 or less and have homesteaded, or lived in, their home for 15 years or more can defer most of their property taxes. The state of Minnesota will treat the deferred taxes as a loan, payable at the time the property is sold or enrollment is canceled, with variable interest not to exceed 5 percent. The property tax you pay will be 3 percent of your total household income based on your prior year income. Applications are handled through the state Department of Revenue. For more information, visit tinyurl.com/SeniorTaxDeferral.
TAX PENALTY WAIVER: Ramsey County property owners may request a waiver to avoid paying a penalty for a late property tax payment. Owners may request one penalty waiver per parcel once every 10 years. The waiver may apply to either the first half of the year or second-half payment, not both. See the Ramsey County property tax website at tinyurl.com/RamCoTax2021.
ABATEMENT FOR EXCEPTIONAL HARDSHIP: Property owners who have suffered a medical emergency or another exceptional hardship have the right to request a property tax abatement from the Ramsey County’s auditor/treasurer. The request may apply to penalties, interest and costs. If an abatement is not granted, Property Tax Services will work with property owners to provide information on all available forms of tax relief available, including developing partial payment schedules. See the county website at tinyurl.com/RamCoTax2021.