2000-11-08 Packet - Laserfiche WebLink

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MINNESOTA VALUATIONS, TAX CREDITS AND LEVY LIMITATIONS Market Value According to Minnesota Statutes, Chapter 273, all real property subject to taxation is to be appraised at maximum intervals of four years. All real property becoming taxable in any year is listed at its esti- mated market value on January 2 of that year. The estimated market value is the County Assessor's appraisal of the worth of the property. Indicated Market Value The Minnesota Department of Revenue conducts the Real Estate Assessment/Sales Ratio Study to ac- complish equalization of property valuation in the State of Minnesota and to determine the probable selling price of a property. The study is a three -year average of sale prices as related to the latest asses- sor's estimated market value. The indicated market value is determined by dividing the estimated mar- ket value by the Assessment/Sales Ratio for the city as determined by the Department of Revenue. Net Tax Capacity Starting with taxes payable in 1990, net tax capacity replaced gross tax capacity as the measure of tax- ' able value. To determine net tax capacity, the estimated market value is multiplied by a factor called "class rate," that varies depending on the use of the property. Net tax capacity differs from gross tax capacity primarily in setting lower values for homesteaded residential and agricultural properties. Net tax capacity is multiplied by the "local tax rate" to determine taxes payable. Tax Cycle Minnesota local government ad valorem property taxes are extended and collected by the various counties within the state. The process begins in the fall of every year with the certification, to the county auditor, of all local taxing districts' property tax levies. Local tax rates are calculated by divid- ing each taxing district's levy by its net tax capacity. One percentage point of local tax rate represents one dollar of tax per $100 net tax capacity, A list of taxes due is then prepared by the county auditor and turned over to the county treasurer on or before the first Monday in January. The county treasurer is responsible for collecting all property taxes within the county. Real estate tax statements are to be mailed out no later than January 31 and personal property tax statements no later than February 15. The due dates for payment of real property taxes are one -half on or before May 15 and one -half on or before October 15. Personal property taxes become due one -half on or before February 28 and one -half on or before June 30. Following each settlement (March 5, June 5, and November 5 of each year), the county treasurer must redistribute property tax revenues to the local taxing districts in proportion to their tax capacity ratios. Delinquent property taxes are penalized at various rates depending on the type of property and the length of delinquency. Tax Credits Prior to 1990, taxes on homestead residential and agricultural property were reduced by a direct sub- sidy to the taxpayer. Beginning in 1990, the homestead credit has been eliminated. The state subsidy is now accomplished through lower class rates to homesteaded classifications of property and increased state aids paid directly to local taxing districts. This new system is intended to have generally the same impact as the former homestead credit system. -21-