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Home What is Limited or Taxable Market Value?
What is Limited or Taxable Market Value

What is limited or taxable market value?

Limited market value (LMV) is a statewide limitation on the amount that a property's market value may grow from one year to the next for purposes of property taxation.  It was enacted to help mitigate rising property taxes resulting from rapidly inflating property values.

What property does LMV apply to?

The following classes of property qualify for LMV:

  • agricultural homestead and non-homestead
  • residential homestead and non-homestead
  • seasonal recreational residential property (i.e., cabins)
  • timberland (beginning with the 2001 assessment)

 

Is it permanent?

LMV provisions were in effect from 1973 to 1979, and again from 1993 to the present.  The 2001 Legislature phased out LMV over a six-year period-from assessment years 2002-2007.  The 2005 Legislature extended the phase-out an additional two years.  Beginning in assessment year 2009 (for taxes payable in 2010), all property will be valued at its estimated full market value for property tax purposes.  The table at the bottom of the page shows the phase-out schedule.

Does the assessor continue valuing the property?

The assessor continues to determine the property's fair market value.  This value is called the "estimated market value" (EMV).  However, property that qualifies for treatment under LMV may not be taxed at the full value of the property if its growth exceeds the limits.

How does it work?

For qualifying property in assessment year 2008 (taxes payable in 2009), the increase in market value cannot exceed the greater of:

  • 15 percent of the LMV in the preceding assessment year, or
  • 50 percent of the difference between the current year's EMV and the previous year's LMV.

How does the phase-out work?

For each year, the maximum valuation increase is determined by calculating the increase allowed under columns (1) and (2), and choosing whichever is higher. 

 

Assessment Year/
Payable Year

(1)

Percentage of previous year's LMV

(2)

Percentage of difference between previous year's LMV and current year's EMV

2002/2003

2003/2004

2004/2005

2005/2006

2006/2007

2007/2008

2008/2009

10%

12

15

15

15

15

15

15%

20

25

25

25

33

50

Example calculations

Assessment year 2008/payable year 2009

The LMV of a home is $100,000 for assessment year 2007.  For assessment year 2008, the assessor determines that the EMV of the home is $140,000.  The maximum market value increase for tax purposes is the greater of:

  • 15 percent increase over the previous year, which is $15,000, or
  • 50 percent of the $40,000 difference in value, which is $20,000.

 

Therefore, the home's LMV is $100,000 plus $20,000, or $120,000 for assessment year 2008 (for taxes payable in 2009).

 

 

ASSESSOR'S OFFICE

Assessor/Land Commissioner
Betty Schultz
Assistant County Assessor
Allison Plummer
Property Appraiser
Cindi Crawford
Technical Clerk
Jill Pederson

LOCATION
Cook County Courthouse
411 W. 2nd Street
Grand Marais, MN  55604

HOURS
8AM-4PM  M-F

PHONE
(218)387-3650

FAX
218-387-3042
EMAIL
assessor@co.cook.mn.us

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