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SF776 (Legislative Session 94 (2025-2026))

Shareholder limit increase for entity-owned agricultural property

Related bill: HF1700

AI Generated Summary

Senate Bill SF No. 776 proposes adjustments to how agricultural property owned by various types of farming entities (like family farm corporations, joint family farm ventures, limited liability companies, or partnerships) is taxed in Minnesota. This bill suggests that these entities can receive special tax classifications for homesteads if they are occupied by shareholders, members, or partners who are actively involved in farming the property. Several key points of the bill include:

  1. Extending homestead tax treatment to properties owned or leased by family agricultural entities even if the title is held under the entity's name rather than an individual's name.
  2. Allowing entities to receive favorable tax classifications for multiple homesteads, under certain conditions, used by actively farming members, partners, or shareholders.
  3. Making agricultural property eligible for certain tax classifications if the property is leased to another entity but farmed by the owner who lives on it.
  4. Permitting non-homestead agricultural properties within specific proximity to the owner's homestead to also receive favorable tax classifications.

Overall, the bill aims to expand the ability for family-owned and operated farming entities to benefit from more favorable tax classifications, which could support the economic viability of family farms.

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
January 29, 2025HouseFloorActionIntroduction and first reading
January 29, 2025SenateFloorActionIntroduction and first reading
January 29, 2025HouseFloorActionReferred toTaxes
January 29, 2025SenateFloorActionReferred toTaxes

Citations

 
[
  {
    "analysis": {
      "added": [
        "Clarifies entitlements to class 1b or class 2a assessments for additional residences on agricultural land owned by these entities."
      ],
      "removed": [
        ""
      ],
      "summary": "This bill amends the provisions for determining homestead classification for family farm corporations and similar entities under section 273.124, subdivision 8.",
      "modified": [
        "Increases the limit of allowable shareholders, members, or partners for family farm corporations from 12 to 20."
      ]
    },
    "citation": "273.124",
    "subdivision": "subdivision 8"
  },
  {
    "analysis": {
      "added": [
        ""
      ],
      "removed": [
        ""
      ],
      "summary": "Refers to qualifying relatives for homestead treatment as described within section 273.124, subdivision 1.",
      "modified": [
        "Refers to which relatives qualify for homestead treatment."
      ]
    },
    "citation": "273.124",
    "subdivision": "subdivision 1"
  },
  {
    "analysis": {
      "added": [
        ""
      ],
      "removed": [
        ""
      ],
      "summary": "Defines terms related to family farm corporations, including the meanings of 'family farm', 'family farm corporation', and 'joint family farm venture' under section 500.24.",
      "modified": [
        "Updated terms and conditions applicable to joint family farm ventures and family farm entities."
      ]
    },
    "citation": "500.24",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [
        ""
      ],
      "removed": [
        ""
      ],
      "summary": "Relates to property classification rules applicable to agricultural and homestead properties under section 273.13.",
      "modified": [
        "Clarifies classifications such as class 1b and class 2a for various properties owned by or leased to family farm entities."
      ]
    },
    "citation": "273.13",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [
        ""
      ],
      "removed": [
        ""
      ],
      "summary": "Cites the definition of a limited liability company under section 322C.0102, subdivision 12.",
      "modified": [
        "Refers to the meaning of limited liability company."
      ]
    },
    "citation": "322C.0102",
    "subdivision": "subdivision 12"
  }
]

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