Sandra is a Minnesota real estate licensee helping a client purchase a home in Rochester. The client asks Sandra whether the home's current homestead classification will automatically transfer to them at closing, saving them from having to apply separately. What should Sandra tell the client?
Correct Answer
C) No, the buyer must apply for homestead classification through the county assessor, and should file by December 1 to receive the benefit for the following tax year
Under Minn. Stat. § 273.124, homestead classification does not transfer automatically when a property is sold. The new buyer must independently apply through the county assessor and meet all eligibility requirements. To receive the homestead market value exclusion for the following tax year, the buyer should file the application by December 1. Sandra should advise her client to apply promptly after closing.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Many states have laws to limit how much property taxes can increase each year, regardless of market value fluctuations.
Various programs and exemptions exist to reduce the property tax burden for specific groups, such as seniors, homesteaders, or veterans.
A transfer tax is a tax imposed on the transfer of ownership of real estate.
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