Minnesota property tax refunds go to homeowners and renters who paid more than they owed, or who meet income limits for specific relief programs
Minnesota has two main paths to a property tax refund. The first is the Property Tax Refund, which goes to homeowners and renters whose property taxes or rent exceeded a percentage of their household income. The second is the Homestead Property Tax Credit, a separate program for lower-income homeowners. You cannot receive both in the same year, but you can switch between them if your situation changes. Both are claimed on your Minnesota tax return, not through a separate application.
The income limits and the percentage thresholds change each year. For the 2023 tax year (filed in 2024), the Property Tax Refund was open to households with income up to roughly $89,000, though the exact limit depends on filing status. The Homestead Credit had a lower income cap. You will need your property tax statement, your household income, and your filing status to determine which program, if either, you may have access to for.
Key Takeaways
- The Property Tax Refund is for homeowners and renters whose property taxes or rent exceeded a set percentage of household income; income limits and percentages change yearly.
- The Homestead Property Tax Credit is a separate program for lower-income homeowners and cannot be claimed in the same year as the Property Tax Refund.
- Both refunds are claimed on your Minnesota tax return (Form M1-PR or Form M1-HC) and are not separate applications.
- You will need your property tax statement, household income, and filing status to determine which program you may may have access to for.
- Refunds are typically issued as part of your state tax return processing, which takes four to six weeks after the Minnesota Department of Revenue receives your return.
The Property Tax Refund: income and property tax thresholds
The Property Tax Refund is the larger of Minnesota's two programs and covers both homeowners and renters. To receive it, your property taxes (for homeowners) or rent (for renters) must exceed a threshold percentage of your household income. That threshold is set by the state each year and varies based on your income level.
For homeowners, you claim the refund based on the property taxes you paid on your primary residence. For renters, the program assumes that 20 percent of your rent goes toward property taxes, so you claim 20 percent of your annual rent as your "property tax" for purposes of the refund. The income limit for the Property Tax Refund varies by filing status and changes annually; you can find the current year's limits on the Minnesota Department of Revenue website under "Property Tax Refund."
If your property taxes or rent-based property tax amount exceeds the threshold for your income level, you are may have access to to a refund of the overage. The refund is calculated on your tax return and issued when your return is processed. There is no separate form to submit—you claim it on your state return.
The Homestead Property Tax Credit: lower-income homeowners only
The Homestead Property Tax Credit is a second program available only to homeowners (not renters) with lower household incomes. The income limit for this credit is lower than the Property Tax Refund limit, and it is designed for households that may not otherwise receive a refund.
Like the Property Tax Refund, the Homestead Credit is claimed on your Minnesota tax return using Form M1-HC. You cannot claim both the Property Tax Refund and the Homestead Credit in the same tax year. If you are unsure which program will give you a larger refund, you can calculate both on your return and claim whichever is higher—the tax software or the Minnesota Department of Revenue will handle this automatically if you enter the required information.
Income limits and how they are set
Minnesota updates the income limits and threshold percentages for both programs each year based on inflation and state revenue. The limits are published by the Minnesota Department of Revenue before the tax filing season begins, usually in December or January.
Income for these programs includes wages, self-employment income, Social Security, pensions, interest, dividends, and other sources. It does not include certain types of income such as some disability payments or workers' compensation. Your household income is the combined income of you and your spouse (if filing jointly) or you alone (if filing single or head of household).
Because limits change yearly, a household that may have access to last year may not may have access to this year, or vice versa. Check the Minnesota Department of Revenue website or your tax software for the current year's limits before filing.
What documents you need to claim a refund
To claim either the Property Tax Refund or the Homestead Credit, you will need your property tax statement from your county assessor or your landlord's rent receipt or lease showing annual rent. You will also need your household income information, which comes from W-2s, 1099s, and other income documents you use to file your federal return.
You do not need to mail in your property tax statement or rent receipts with your return. However, you should keep them in your records in case the Minnesota Department of Revenue asks for verification. If you file electronically, your tax software will ask you to enter the property tax or rent amount, and you will confirm it from your statement.
If you own property in more than one state or own rental property in Minnesota, the rules become more complex. Contact the Minnesota Department of Revenue directly if your situation involves multiple properties or if you are unsure whether a particular property qualifies.
Timeline for receiving your refund
Property tax refunds are not issued separately. Instead, they are calculated as part of your Minnesota tax return and included in your overall state tax refund (or applied to taxes owed). Once the Minnesota Department of Revenue receives your return, processing typically takes four to six weeks. If you file electronically, processing is usually faster than paper returns.
If you are owed a refund, it will be issued by direct deposit (if you provided banking information) or by check mailed to your address on file. You can track the status of your return on the Minnesota Department of Revenue website using your Social Security number and the amount of your refund.
If you file late in the tax season (after April 15), your refund may take longer to process because the department receives a high volume of returns. Filing early increases the likelihood of faster processing.
What to do if you think you were denied or underpaid
If you filed a return claiming a property tax refund or homestead credit and did not receive the amount you expected, first verify that you entered the correct property tax or rent amount and that your household income was calculated correctly. Common errors include using the wrong property tax statement year or including income that should have been excluded.
If you believe the calculation is correct but the refund was denied or reduced, contact the Minnesota Department of Revenue. You can reach them by phone at 651-296-3781 or through their website. Have your tax return, property tax statement, and any correspondence from the department available when you call. If the department made an error, they can issue a corrected refund, though this may take additional time.
You can also file an amended return (Form M1-X) if you need to correct information on your original return. Amended returns are processed in the order they are received and typically take six to eight weeks.
Frequently Asked Questions
Can renters get the Homestead Property Tax Credit?
No. The Homestead Property Tax Credit is only for homeowners. Renters can only claim the Property Tax Refund, which assumes 20 percent of rent goes toward property taxes. If you rent, use the Property Tax Refund program.
What if I own my home but did not pay property taxes directly?
If your mortgage lender pays property taxes from an escrow account, those taxes still count toward your refund. Use the amount shown on your property tax statement or your annual escrow statement from your lender. You do not need to have paid the taxes yourself.
Can I claim a refund for a second home or rental property?
No. Both programs apply only to your primary residence. Rental properties and vacation homes do not may have access to. If you own multiple properties, use only the property tax amount for the home where you live most of the year.
What happens if my income was very low or zero?
You may still may have access to for a refund if your property taxes or rent exceeded the threshold for your income level. Even households with no income can claim a refund if they paid property taxes or rent. File a return to determine your refund amount.
Do I have to file a separate application for these programs?
No. Both the Property Tax Refund and the Homestead Property Tax Credit are claimed directly on your Minnesota tax return. There is no separate application process. Simply enter the required information when you file.