Minnesota Market Value Exclusion for a Veteran with a Disability

Minnesota does not exempt a veteran's homestead from property tax and does not credit the tax back. It removes a slice of market value before the tax is computed, which is a third mechanism and produces a different number from either. The two tiers run off one rating. A veteran with a service-connected disability of 70 percent or more, certified by the United States Department of Veterans Affairs and honorably discharged as shown by a DD214 or other official discharge papers, excludes $150,000 of the market value of the homestead. A veteran with a total (100 percent) and permanent disability excludes $300,000. Read the second tier carefully. It is written as "a total (100 percent) and permanent disability", not as a 100 percent rating. A veteran rated 100 percent schedular without a permanence finding sits at the $150,000 tier. Minnesota is not alone in this, but it is one of the states where the word "permanent" is doing work that a county assessor will enforce. The exclusion is exclusive, not additive, and this is the part most summaries omit. Paragraph (g) says a property qualifying under this subdivision is not eligible for the homestead market value exclusion under subdivision 35 or for classification under subdivision 22, paragraph (b), which is class 1b. Every ordinary Minnesota homestead already receives the subdivision 35 exclusion, which is 40 percent of value up to $95,000 and phases to nothing at $517,200. A veteran moving to the $150,000 tier gives that up. The true gain is $150,000 minus whatever the general exclusion was worth on that house, and on a modest home that difference is materially smaller than $150,000. The caregiver route is the unusual one. Where a veteran meets the 70 percent test but does not own property classified as homestead anywhere in Minnesota, the homestead of the veteran's primary family caregiver is eligible for the exclusion the veteran would have had, at the veteran's tier. "Primary family caregiver" means a person approved by the secretary of the United States Department of Veterans Affairs as the primary provider of personal care services under the Program of Comprehensive Assistance for Family Caregivers in 38 U.S.C. 1720G. The federal approval does the work; the assessor does not make a caregiving finding of its own. No other state in this catalog attaches a property tax benefit to a caregiver's house. On an agricultural homestead only the house, the garage and the immediately surrounding one acre qualify. The rest of the farm is valued normally. Application is to the county assessor by December 31 of the first assessment year for which the exclusion is sought, which is the December before the taxes payable year. Miss it and the year is gone. The property must already have Minnesota homestead classification. After acceptance the owner must notify the assessor of a change in ownership or in homestead use, and by July 1 each year the county veterans service officer must certify the disability rating and permanent address of every veteran receiving the benefit to the assessor. That certification is why the CVSO, not the assessor, is the right first call. "Veteran" here takes the meaning in section 197.447, which requires 181 consecutive days of active duty, or separation by reason of a disability incurred on active duty, or one of the alternative routes in that section. The legislature wrote its reason into the statute, which is rare enough to quote: the purpose is "to help ease the burdens of war for those among our state's citizens who bear those burdens most heavily."