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Property tax refunds are available to (and forgotten by) Minnesotans

June 4, 2019  |  Corey Butler

Property tax refunds are available to (and forgotten by) Minnesotans

Most everyone can agree on this: Taxes are confusing. They’re multifaceted, multilayered and can recur at different times of the year.

However, there is one positive tax interaction that, unfortunately, can be easily forgotten about. After Tax Day is out of the way and most taxpayers look forward to not worrying about taxes for nearly a calendar year, summer arrives with the promise of tax relief in the form of a property refund tax.

If you worked with a certified public accountant (CPA) to complete your tax income return this year, you’re probably all set for the property tax refund. If you handled your own taxes either by paper or with software, it may be incumbent on you to take the extra step in the coming months to make sure you’re paid back what you’re owed from Minnesota.

Property tax refund 411

The Minnesota Department of Revenue estimates that 750,000 homesteads are eligible for the homeowner property tax refund. That accounts for a little more than 50 percent of homesteads in the state. Eligible properties only include a homeowner’s main property in which they reside; cabins, second homes and rental properties aren’t eligible.

Of those eligible, the Revenue department expects about two-thirds of property owners to file for the refund, which is in line with prior years. That means 250,000 homeowners are leaving money on the table.

Generally paid twice (in the spring and the fall), your property taxes, in part, fund your local municipality, school district, county and smaller taxing districts (like economic development authorities, housing and redevelopment authorities, etc.).

Last year, homeowners received an average refund of $939.

“Minnesotans are lucky that we have this state program that gives a refund timed to assist with making that second real estate tax payment,” said Ann Etter, CPA, vice president of Goodney & Associates, PA. “It is especially helpful for those whose income may have decreased since they originally bought their home, assisting them to remain in their home.”

There is also a refund available for renters who, last year, received an average of $668, according to the Revenue department.

Here’s a look at some of the nitty gritty of the refunds. You’re also encouraged to review the Form M1PR instructions to best understand your specific situation and eligibility.

Who is eligible?

Eligibility is largely tied to household income for your primary residence in Minnesota. For 2018, your total household income needed to be less than $113,150 to qualify. Depending on your circumstances, you may qualify for a refund of up to $2,770.

For renters, your total household income needs to be less than $61,320. Renters must have a certificate of rent paid (CRP) for each rental unit you lived in during 2018. This should have been provided by your landlord(s). Depending on your circumstances, you may qualify for a refund of up to $2,150.

There is also a Special Property Tax Refund available for homeowners (no income limit) if your net property tax increased by more than 12% (and was at least $100) from 2018 to 2019, and the increase wasn’t as a result of home improvements. The maximum refund is $1,000.

What is the filing due date?

The due date is Aug. 15. You may file online or complete the paper Form M1PR and claim a refund for up to one year after the original due date. If you file later, you will not receive a refund, according to the Minnesota Department of Revenue.

When can I expect my refund?

Per usual, the earlier you file the better. Refunds will start being issued after July 1 and can be tracked at the Department of Revenue’s “Where’s My Refund” page.

What can slow down my refund?

  • Mailing a paper return.
  • Not choosing direct deposit.
  • Errors on your tax return.
  • Returns the Department of Revenue identify for additional review.

What information do I need when filing?

  • Your Social Security Number.
  • The address of the homestead.
  • A valid email address.
  • Your household income records. 
  • The property tax statement (“Statement of Property Taxes Payable” from your county).
  • A bank account and routing numbers (all refunds are sent electronically).

Better safe than sorry

Don’t leave money on the table. If you didn’t work with a CPA who handled the property tax refund for you, be sure to follow up to make sure this is handled correctly.

Below are some links to help you find your way.

Topics: Taxation-Individual, Personal Financial Planning

Corey Butler

Corey Butler is the MNCPA communications coordinator, focusing on providing timely and relevant content for members in both print and digital mediums. He's also the person behind the wildly successful Taxline, which is 25 years strong. Corey keeps busy outside of the MNCPA spending time with his wife and children, embracing and volunteering in his community, and catching up on long-lost hobbies. He also mows his yard. Corey enjoys the works of John Steinbeck and J.K. Rowling, and Paul Bunyan and Robin Hood lore. You may reach him at 952-885-5533 or cbutler@mncpa.org.

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