Low Income Rental Classification (LIRC)

Minnesota Statute 273.128 provides that qualifying low-income rental properties are eligible for a class rate reduction in property taxes. The LIRC statute specifies the type of the properties that are eligible and eligibility criteria required to receive the reduction.

The full statute can be found in Appendix A or at Minnesota's Office of the Revisor of Statutes at www.revisor.mn.gov; 273.128 Certification of Low-Income Rental Property.

Only those rental properties subsidized under a federal or state government program or meeting certain rent and income restrictions are eligible for the lower class rate. Applications must be made to Minnesota Housing for certification to the local assessor that a property qualifies for the reduced rate.

Program

Refer to the LIRC Program Guide for complete program details.

Classification Rate is .75% (reduced from 1.25%)
Qualifying Properties are at least 20% of total units in the rental property must meet one or more of the following criteria:

  • Project Based Section 8,
  • Low Income Housing Tax Credits,
  • Rental Assistance units financed through Rural Housing Service of USDA,
  • Rent and income restrictions at or below 60% Area Median Income placed on units by state, federal, or local unit of government as evidenced by a document recorded against the property.

Note:
The lower tax rate applies only to that portion of the rental property meeting all eligibility criteria. The regular rental class rate of 1.25% will apply to the remainder of the property. Market value determined by the assessor must be based on the standard approach to valuation using unrestricted market rents.

It is the responsibility of the owner to inform Minnesota Housing of any changes throughout the year.  Failure to do so may result in missed communication or the loss of classification.

Application

Include a non-refundable application/reapplication fee of $10 per qualifying unit; total fee not to exceed $150.

The Application deadline is March 31 each year for taxes payable the following calendar year. Late applications/reapplications will not be accepted.

Application Form - Downloadable form and instructions for new applicants only.

Reapplication Form - Downloadable form and instructions for previous participants only. Personalized "Reapplication" forms for currently enrolled properties will be sent by mail.

2017 LIRC Assessor Report

Contact

Steve.OBrien@state.mn.us or 651.297.4065