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Real Living Messina
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Thanks for visiting the Real Living Messina & Associates Real Estate Blog
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Changes in Homestead Benefits Resulting in Property Tax Increase
12/19/2011
Search Engine Friendly URL: http://www.mzr.com/news_20111219_2779/changes-in-homestead-benefits-resulting-in-property-tax-increase/
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Due to recent changes in legislation, property taxes paid in 2012 will be under the new Homestead Market Value Exclusion. The current Homestead Credit will end with all property taxed paid in 2011.
To understand the details of these changes and how they could increase your property taxes, click the PDF link below or contact one of our knowledgeable real estate agents.
http://taxes.state.mn.us/property/Documents/hmve-taxpayers.pdf
The basic changes described in the document are as follows:
A credit is a reduction in the amount of taxes due, while an exclusion is a reduction in the amount of value subject to tax. The former Homestead Credit gave a credit to your initial tax based solely on the value of the homestead, but the new Homestead Exclusion calculates the benefit based on additional factors, resulting in a reduction in the value subject to tax.
This change could result in tax increases for one of these four reasons:
1. There will be no state paid money to reduce your total property taxes.
2. A higher tax rate is required with the reduction in taxable value.
3. Certain property types and higher value homes will pay a larger share of the tax.
4. The exclusion will provide less benefit to those in lower than average tax rate areas.
Other things that could affect your property taxes are local levy decisions, market forces that change the value of your property, classification of your property, eligibility for other benefits, and other miscellaneous law changes.
Feel free to CONTACT one of our agents if you have questions about these changes.
Call us: 218-728-4436
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