As property taxes across the county and state take a hike this year, some relief may be found in a special property tax refund that has been around for years.
The special refund or rebate, referred to as the “Targeting Property Tax Refund,” is available to taxpayers with a 2012 property tax bill that’s at least 12 percent higher than what they paid in 2011. The increase must total at least $100. The Minnesota Department of Revenue offers the special refund of up to $1,000.
Unlike the regular property tax refund, the targeting refund is not tied to the taxpayer’s household income, according to 2012 information on the program from the legislature’s House Research Department.
“The way the legislature and state changed the homestead calculations (eliminated the homestead market value exclusion) last summer and blind sided people, that has caused almost everyone to have a tax increase,” according to Bob Peterson, Koochiching county auditor.
Property owners received their property tax bills from the county in March. Property tax statements for mobile home owners were mailed out to taxpayers this week, notes Peterson. Homeowners can now file for the targeting property tax refund through the state by Aug. 15.
The form for the special refund is the same as the form for the regular tax refund, the M-1PR form. The property tax payer fills out a special section on the back of the form to apply for the targeting refund.
Forms and booklets with instructions can be picked up at the Koochiching County Auditor/Treasurer Department or found online at http://www.revenue.state. mn.us/individuals/prop_tax_refund.
Online instructions are included at that website, where taxpayers can also file electronically.
Although homeowners pay property taxes directly to the county, residents must file for refunds to the Minnesota Department of Revenue, based in St. Paul.
The special refund requires that the owner lived in the same home for both years between the increase. According to details released this year by the Legislature, the taxpayer first pays the increase of at least 12 percent, and the remaining tax increase is eligible for relief. The state pays 60 percent of the excess increase, up to $1,000.
If a homeowner owes more than $100 in property taxes, the payment can be split with the first half paid to the county by May 15 and the second half by Oct. 15, Peterson said. If the taxes are not split, they are due Aug. 15, and can be paid at the county auditor office.
Homeowners who qualify for the special refund and apply by Aug. 15 can expect the refund from the state to be paid to them in late September. That’s the same time the regular refunds are paid to qualifying taxpayers. The deadline for filing claims based on taxes payable in 2012 is Aug. 15, 2012; taxpayers filing claims after that date will not receive a refund.
The statewide amounts paid out for the targeting program decreased substantially from $7.6 million in 2007 to about $2.3 million in 2010, according to information from the research department of the Minnesota House of Representatives. The department concluded that some taxpayers, especially those who typically don’t qualify for the regular property tax refund, “may not be aware of the targeting program, resulting in lower total refunds statewide than if all eligible taxpayers had filed.”
The Minnesota Department of Revenue’s property tax division also informs the public that renters may qualify for the regular property tax refund with a maximum refund of $1,550. As long as the renter lived in a rental property not exempt from property taxes in 2011, and the renter has a 2011 income of $54,620 or below, the renter may file for a property tax refund. For renters, 19 percent of the rent paid during 2011 is considered the portion paid for property tax.
Landlords were required by law to give tenants a certificate of rent paid, or a CRP, by Jan. 31 which states the amount paid in 2011. The tenant will need to use the certificate to file for a property tax refund from the Minnesota Department of Revenue.
Deadlines for the filing for the regular property tax refund for renters are the same as for homeowners: Aug. 15, with a one-year grace period. Refund checks are typically sent 60 days after filing, according to the state.
For more information on property taxes and how they are calculated, visit www.taxes.state.mn.us
Qualifications for 2011 property tax refunds, paid in 2012:
• As a renter, your total household income for 2011 must be less than $54,620. The maximum refund is $1,550.
• As a homeowner, you may be eligible for one or both of the following refunds, if you owned and lived in your home on January 2, 2012. To qualify for the:
– regular property tax refund, your total household income for 2011 must be less than $100,780. The maximum refund is $2,460.
– special property tax refund, you must have owned and lived in your home both on January 2, 2011, and on January 2, 2012; your net property tax on your homestead must have increased by more than 12 percent from 2011 to 2012; and the increase must be at least $100. There is no income limit for the special property tax refund. The maximum refund is $1,000.
* Source: Minnesota Department of Revenue
