HF3727

Purpose

This bill changes how property tax relief works for veterans with disabilities and their families by increasing the amount of market value that can be excluded from the property tax on a veteran’s homestead. It also clarifies who can receive the benefit and how it can be continued or transferred within families after a veteran’s death, and it expands some eligibility to include primary family caregivers.

Main Provisions

• In Minnesota Statutes 2024 section 273.13 subdivision 34, the bill modifies the Homestead valuation exclusion for veterans with a disability or their family caregiver.
• For a veteran with a service-connected disability rated 70% or more, the amount of market value excluded from the property tax increases (from the previous level to a higher exclusion amount, up to $200,000 of market value).
• For a veteran with a total disability (100% permanent and total), the amount excluded increases (from $300,000 to $400,000 of market value).
• The qualification continues to require an honorable discharge (as shown on DD214 or other official discharge papers) and ownership of the homestead.
• The bill states that in certain cases the exclusion can be carried over to a surviving spouse who holds title and permanently resides in the home, with rules about applying, notifying the assessor, and changes in ownership or residence.
• If a service member dies while on active duty from a service-connected cause and a spouse holds the homestead, the spouse can continue to receive the benefit until remarriage or sale, under specific conditions.
• If the veteran does not own a homestead, the veteran’s primary family caregiver (as defined by the VA) may receive the exclusion for the caregiver’s homestead.
• For agricultural (farm) homesteads, only the house, garage, and the surrounding one acre qualify for the exclusion.
• A property that qualifies for this valuation exclusion cannot also receive the market value exclusion under a different subdivision or be classified under another exemption.

Eligibility and Application Process

• Eligibility: Veteran must have a service-connected disability of 70% or more (or 100% total and permanent) as certified by the U.S. Department of Veterans Affairs; the veteran must own and permanently reside in the homestead; discharge must be honorable.
• Application deadline: Property owners must apply to the assessor by December 31 of the first assessment year for which the exclusion is sought.
• Certification: By July 1 of each year, the county veterans service officer must certify the veteran’s disability rating and permanent address to the assessor.
• If the veteran dies, the surviving spouse may apply for continuation of the exclusion under specified conditions and may carry the benefit to a different qualifying property if certain criteria are met.
• First-time applications by a qualifying spouse within two years of the veteran’s death are allowed (for the continuation of the exclusion).
• If a veteran did not apply for the exclusion before death, the surviving spouse may still be eligible under the rules described for spouses.
• If a veteran’s property is not a homestead, the veteran’s primary family caregiver may qualify for the exclusion for the caregiver’s homestead.

Spouse and Family Caregiver Provisions

• Surviving spouses who hold legal or beneficial title to the homestead and permanently reside there may continue to receive the exclusion, with rules about remarriage, sale, or transfer.
• Spouses may continue or reapply under specific conditions if the veteran’s death or the change of ownership occurs.
• The designation of “primary family caregiver” is tied to the VA program for caregivers (as described in federal law), and the caregiver’s homestead may be eligible if the veteran did not own a qualifying homestead.

Administrative Details

• The purpose of this law is to provide a level of property tax relief to ease the burdens faced by veterans with disabilities and their families.
• The bill ensures eligibility and administration through the county assessor and county veterans service officers, including required certifications and notices about changes in ownership or residence.
• Eligibility rules also address agricultural property and the interplay with other Minnesota tax classifications and exemptions.

Notable Changes from Current Law

• Increases the market value exclusion amounts for 70%+ disability and for 100% total and permanent disability.
• Expands eligibility to allow the veteran’s primary family caregiver to receive the exclusion when the veteran does not own a homestead.
• Adds rules for continued eligibility for surviving spouses and for transferring eligibility to a different qualifying property.
• Clarifies and tightens deadlines for applications and required notices to assessors.
• Applies to agricultural homesteads (limited to the home, garage, and surrounding one acre).
• Keeps a cap that the property cannot be simultaneously eligible for certain other exclusions.

Relevant Terms - market value exclusion - homestead - veteran with a disability - service-connected disability - 70 percent or more - 100 percent and permanent disability - DD214 - DD1300 - DD2064 - primary family caregiver - United States Department of Veterans Affairs (VA) - caregiver program (38 U.S.C. 1720G) - assessor - county veterans service officer - agricultural homestead - exemption carryover - remarriage, sale, transfer - notice requirements - ownership (as a deed holder)