By Sean Williams, sean.williams@house.mn.gov
Homestead Credit
Refund Program
June 2024
What is the homestead credit refund program?
The homestead credit refund is a state-paid refund that provides tax relief to homeowners whose
property taxes are high relative to their incomes. The program was previously known as the
homeowner’s property tax refund program, or PTR, and sometimes popularly called the “circuit
breaker.” If the property tax exceeds a threshold percentage of income, the refund equals a percentage
of the property tax over the threshold, up to a maximum amount. As income increases:
the threshold percentage increases,
the share of tax over the threshold that the taxpayer must pay (the “copay percentage”)
increases, and
the maximum refund decreases.
The program uses household income, a broad measure that includes most types of income, including
income that is not subject to income tax. Deductions are allowed for dependents and for claimants who
are over age 65 or disabled. The refund is based on taxes payable after subtracting any targeting refund
claimed by the homeowner. (The targeting refund is an additional refund available to homeowners who
have large property tax increases from one year to the next.)
What are the maximums?
For refund claims filed in 2024, based on property taxes payable in 2024 and 2023 household income, the
maximum refund is $3,310. Homeowners whose income exceeds $135,410 are not eligible for a refund.
How are claims filed?
Refund claims are filed using the Minnesota Department of Revenue (DOR) Schedule M1PR, which is
filed separately from the individual income tax form. Claims based on taxes payable in 2024 that are
filed before August 15, 2024, will be paid beginning in late September 2024; claims filed electronically
may be paid a month earlier. The deadline for filing claims based on taxes payable in 2024 is August 15,
2025; taxpayers filing claims after that date will not receive a refund.
How many homeowners receive refunds, and what is the total amount paid?
494,627 homeowners received refunds based on 2022 property taxes payable and 2021 incomes. The
average refund was $1,129, and the total dollar amount of refunds paid statewide was $558.5 million.
The average refund for senior and disabled claimants ($1,188) was slightly higher than the average for
those under age 65 and not disabled ($1,079).
What are the most recent changes to the program?
The 2023 tax law (Laws 2023, chapter 64) reduced co-pay percentages for all filers by three percentage
points. The law also provided a onetime increase of 20.572 percent for all property tax refunds payable
in 2023. Additionally, the law converted the renter’s credit program, which had previously been
administered together with the homestead credit, into a refundable income tax.
Homestead Credit Refund Program
How do refunds vary depending upon the filer’s income and property tax?
The following table shows the refund calculations for four example families with different incomes—two
families in the seven-county metro area and two in Greater Minnesota. Although the program
parameters are the same statewide, the average residential homestead property tax in the metro area is
higher than in Greater Minnesota. The example metro area families have homes valued at $420,700 and
property taxes of $4,910, the average amounts for the metro area in 2023. The example families in
Greater Minnesota have homes valued at $289,000 and property taxes of $2,926, the average amounts
for Greater Minnesota in 2023. Taxpayers who are over age 65, disabled, or have dependents are
allowed a subtraction from income in determining the refund.
Married couple, both under age 65, two dependents
Example refunds for claims to be filed in 2024,
based on taxes payable in 2024 and 2023 income
Metro Area
Greater Minnesota
Taxpayer #1 Taxpayer #2 Taxpayer #3 Taxpayer #4
1
Property tax
$4,910
$4,910
$2,926
$2,926
2
Gross income
$40,000
$83,000
$40,000
$83,000
3
Deduction for dependents
$12,960
$12,960
$12,960
$12,960
4
Household income
(2 – 3 = 4)
$27,040
$70,040
$27,040
$70,040
5
Threshold income
percentage
2.0%
2.0%
2.0%
2.0%
6
Threshold % x income
(4 x 5 = 6)
$541
$1,401
$541
$1,401
7
Property tax over threshold
(1 – 6 = 7)
$4,369
$3,509
$2,385
$1,525
8
Statutory copay percentage
22%
32%
22%
32%
9
Taxpayer copay amount
(7 x 8 = 9)
$961
$1,123
$525
$488
10
Remaining tax over
threshold
(7 – 9 = 10)
$3,408
$2,386
$1,860
$1,037
11
Maximum refund allowed
$3,310
$2,680
$3,310
$2,680
12
Net property tax refund
$3,310
$2,386
$1,860
$1,037
13
Net property tax paid after
refund
(1 – 12)
$1,600
$2,524
$1,066
$1,889
Claimants can check the status of their refund by calling DOR at 651-296-4444 or online
(https://www.revenue.state.mn.us/wheres-my-refund).
Minnesota House Research Department provides nonpartisan legislative, legal, and
information services to the Minnesota House of Representatives. This document
can be made available in alternative formats.
www.house.mn.gov/hrd | 651-296-6753 | Third Floor, Centennial Office Building | St. Paul, MN 55155
