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Proposal would lower threshold for targeting property tax refund and raise the cap

Minnesota House Tax Committee · March 12, 2026

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Summary

Lawmakers heard testimony on lowering the targeting property tax refund threshold from 12% to 6% and raising the refund limit to $2,500; advocates and Realtors backed the change and the committee laid the bill over.

Representative Hewitt introduced House File 3959 to adjust the targeting property tax refund: reduce the year-over-year increase threshold homeowners must exceed from 12% to 6% and increase the refund cap from $1,000 to $2,500.

A Department of Revenue staffer explained current law and the bill's mechanics: under current law, the refund applies when property taxes increase more than 12% year over year (with more than $100 increase) and refunds essentially 60% of the increase above 12%; HF3959 would lower the threshold to 6% and raise the maximum refund.

Paul Eager of the Minnesota Realtors Association testified in support, saying the change would provide direct relief to homeowners without shifting property tax burdens. Members debated how rising market values, unfunded state mandates and federal policy shifts influence local levy increases and whether a threshold reduction alone is sufficient.

Representative Hewitt renewed his motion to lay HF3959 over for possible inclusion in the 2026 tax bill; the committee carried the motion and laid the bill over.