Minnesota Tax Act Expected to Provide Relief for Property Owners

Published On: 18th December 2013

From The Internet

In an ironic twist after some residents of Minnesota are seeing their property taxes go up, some are seeing them go down because of a new Tax act that the Minnesota Legislature passed in 2013. The total amount of direct and indirect property tax relief is approximately $272 million. The owners of businesses, farms, homes, and cabins will all benefit.

It had been stated previously that property taxes were going to increase from the wealthiest Minnesotans down to the poorest of the poor. However, the 2013 tax act has kept this from happening. The Department of Revenue has shown that homeowners making less than $101,000 per year who do not smoke will see an overall tax decrease.

The taxes are expected to increase for smokers because of the state’s new cigarette tax, but not for many property owners.

The reason for the new cigarette tax, which has increased to $2.83 per pack, is because of the costs that the addiction has on medical expenditures, lost production in the workplace, and premature death.

In addition, the wealthiest 2 percent in the state will pay higher Minnesota income taxes. Even after this rate, the total state and local tax rate will be less than what is paid by middle-income and lower-income Minnesotans.

The property tax analysis has shown that the decline in property tax has much to do with a reduction in property values. However, a separate analysis has shown that tax relief, especially in southeast Minnesota, is due to the 2013 tax act.

In addition, the property tax reductions are not factoring in the property tax relief that has resulted from the $128 million expansion of the property tax refunds paid by the state. These refunds were issued to middle-income families. After last year’s property tax increase, resulting from the Homestead Credit’s demise and the elimination of other provisions present in the 2011 tax act, the 2013 tax act provides property tax relief for taxpayers all through the state.

Source: http://www.fairmontsentinel.com/page/content.detail/id/526666/Tax-act-provides-relief.html