The following article was written by St. Louis County Auditor/Treasurer Donald Dicklich. It was originally published in the Duluth Budgeteer on May 8, 2016.
Nobody likes paying taxes. Benjamin Franklin, one of our nation’s founding fathers, once said, “In this world nothing can be said to be certain, except death and taxes.” I think one can conclude he wasn’t fond of taxes either, but recognized them as inevitable in order to support the services they expect from their government.
For people not paying property taxes through an escrow account, the property tax payment for the first half of the year is due on Monday, May 16. (You get an extra day this year, since the 15th falls on a Sunday.) Besides this timely reminder, I also want to highlight some of the programs available through the state or federal government that can assist people who may be struggling to pay their property taxes.
The one that helps the most people is often overlooked. It’s the Homestead Credit Refund, a state-paid refund aimed at assisting homeowners whose property taxes are high compared to their household income. I suspect there are a lot of eligible homeowners in St. Louis County who aren’t taking advantage of it.
The Minnesota Department of Revenue sends a letter to homeowners it’s identified as likely being eligible for a refund of $1,000 or more, but there are others who probably qualify for some level of refund.
Eligibility requirements include the total household income for 2015 must be less than $107,930; the property must be classified as homestead, and the person filing must have owned and lived in the home on January 2, 2016; eligible filers cannot be a dependent and must have been a full- or part-year Minnesota resident in 2013.
Additionally, there is a Special Homeowners Homestead Credit Refund available for property owners whose home’s net property tax increased by more than 12 percent from 2015 to 2016, provided the increase is at least $100 and is not due to improvements made to the property.
To learn more about either of these options, including filing instructions, visit the Minnesota Department of Revenue’s website, or call 1-800-652-9094.
There are additional special programs that may reduce the property tax bill for select groups of homesteaders.
Disabled Veterans Market Value Exclusion: Veterans with a service-connected disability rating of 70 percent or more are eligible. The exclusion lowers the amount that is subject to property taxes.
Disability Homestead: Property owners who are legally blind or permanently and totally disabled may qualify. The program reduces the property tax classification rate, resulting in a lower property tax bill.
Senior Citizen Deferral: For anyone age 65 or older with a household income of $60,000 or less, this program limits the maximum amount of property taxes owed to three percent of your household income, with the state providing a low interest loan to cover the rest. It’s important to note this will result in a lien on your property.
Disaster Relief: This is for Property owners who have had at least 50 percent of a structure on their property destroyed by fire or natural disaster. Relief may include an abatement for taxes due during the year of the disaster, and property tax credits in the following year.
You can find more information on these and other programs on our county website.
One last helpful tip, for property owners who have fallen behind in paying their property taxes, LSS Financial Counseling and AEOA are great resources. Their counselors help people set up a realistic budget and develop a repayment plan for property taxes and any other debts they may have. All services are free and confidential. People who live in the Duluth area should contact LSS at (218) 726-4767. People who live outside on the Iron Range and elsewhere in the County outside of Duluth should contact AEOA at (218) 735-6826.