If you bought a home in Minnesota this year and you live in it, there is one form worth filing before the year ends: the homestead application with your county assessor.
What homestead does
According to the Minnesota Department of Revenue, a homestead classification may qualify your property for a Homestead Market Value Exclusion, which lowers the taxable value of the home, and it is one of the requirements for related programs such as the Property Tax Refund. In plain terms: the same house can carry a lower property tax bill once it is classified as your homestead.
Who qualifies
The Department of Revenue lists three conditions. You must:
- own the property,
- occupy it as your sole or primary residence, and
- be a Minnesota resident.
Some relatives of the owner can qualify a property as a "relative homestead" too, but the Department notes that relative homesteads do not qualify for a property tax refund. A married couple may have only one homestead in the state.
How and when to apply
Homesteads are handled by the counties, so you apply to the assessor in the county where the home is. The Department's rule for timing is short: "Apply to your county assessor by December 31 to qualify for taxes payable the next year." You will be asked for the Social Security Number or Individual Taxpayer Identification Number of each owner who lives in the home, and of each owner's spouse.
Once the homestead is granted you generally do not reapply, but you must tell the assessor within 30 days if you move, sell the home or your marital status changes. The Department says a property can be subject to a penalty when that notice is missed.
What this means for a buyer
If you close in the autumn, the December 31 deadline comes up fast. Put the homestead application on your closing checklist next to the utilities and the change of address. Weshebi Desmond reminds every client about it after closing, and the county assessor's office can confirm the exact steps for your county.
General information from the source below, not tax advice. Check the Department of Revenue's page and your county assessor for current details.