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Legislature > House of Representatives > House Research > Taxes > Major State Aids & Taxes

Major State Aids & Taxes: Additional Property Tax Refund (Targeting)

Program Description

"Targeting" is an additional property tax refund. The refund targets property tax relief to those homeowners whose property tax increase over the previous year exceeds a threshold percentage set by the legislature. The property tax refund return (M1PR) contains a separate schedule for the targeting refund. The taxpayer files for this refund at the same time and in the same manner as for the regular property tax refund. However, unlike the regular property tax refund, all homeowners qualify for targeting regardless of their household income if the tax increase exceeds the specified percentage.


Aid Amount and Reporting

2013 Targeting Refunds: $0.7 million

For returns filed in 2013 (for property taxes payable in 2013), the state paid 60 percent of the property tax increase over 12 percent (i.e., the taxpayer had to pay the first 12 percent increase over the previous year before qualifying for a refund), provided that the increase was greater than $100. There were 6,191 returns filed in 2013 for a total amount of $728,581. The average refund per return was $118. (The maximum refund is $1,000.) The amount of the targeting refund is listed separately on all of the tables in this report, directly after the regular property tax refund amounts.

Targeting refund amounts can change greatly from one year to the next in any given county. Factors resulting in large fluctuations in refunds in recent years include net tax changes due to volatility in the housing market and the phaseout of limited market value.

Thirty-one counties reported fewer than four claims for targeted refunds filed in 2013 by senior/disabled claimants and by nonsenior/nondisabled claimants (Beltrami, Big Stone, Chippewa, Clearwater, Cottonwood, Dodge, Fillmore, Goodhue, Grant, Houston, Jackson, Lac-qui-Parle, Lake of the Woods, Lincoln, McLeod, Mahnomen, Marshall, Nicollet, Nobles, Norman, Pipestone, Pope, Redwood, Renville, Roseau, Sibley, Steele, Stevens, Swift, Wilkin, and Yellow Medicine). To protect taxpayer confidentiality, the Department of Revenue is unable to provide detailed counts for these counties. These refunds were included in the totals for "county undesignated."

The total for which the county is undesignated represents 3.4 percent of all claims. This report apportions these claims to the 87 counties based on each county's share of refunds.

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Recent Law Changes

The statutory percentage of 60 percent was increased to 90 percent for taxes payable in 2012 only under Laws 2012, chapter 294, article 1, section 6. For refunds based on the change in tax from 2011 to 2012 only, the targeting refund equaled 90 percent of the property tax increase over 12 percent, up to the maximum refund of $1,000.

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The Past Five Years of Targeting Refunds

The table below shows the distribution of targeting refunds in thousands of dollars for the past five years for the state and economic development regions. The graph shows total dollars of targeting refund for that same time period in nominal (actual) and constant (inflation-adjusted) dollars.

Targeting: Filed 2009 through Filed 2013
Nominal dollars, in thousands
Filed 2009 Filed 2010 Filed 2011 Filed 2012 Filed 2013
State $6,088 $2,334 $1,902 $3,266 $729

Northern Regions
Northwest (1)
Headwaters (2)
Arrowhead (3)
West Central (4)
Five (5)
East Central (7E)
37
36
286
205
122
170
10
24
398
82
86
86
4
7
148
152
51
24
129
42
671
380
236
88
12
5
121
32
32
24

Southern Regions
Six East (6E)
Upper MN Valley (6W)
Central MN (7W)
Southwest (8)
Nine (9)
Southeastern MN (10)
189
20
533
77
148
468
79
8
205
18
72
234
25
10
72
35
35
106
48
24
324
58
391
297
8
0
30
8
21
42
Total Nonmetro $2,289 $1,302 $670 $2,690 $335

Metro Region
Hennepin County
Ramsey County
Remaining Metro
2,267
802
729
482
196
354
949
121
162
114
311
152
207
108
78
Total Metro $3,798 $1,032 $1,231 $576 $394

Targeting Refunds

Statewide targeting refunds for five years

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March 2017

House Research Department  ♦  600 State Office Building, Saint Paul, MN  55155  ♦  House.Research@house.mn  ♦  651-296-6753