Bill > SF776

This bill increases the maximum number of shareholders, members, or partners allowed in a family farm corporation, joint farm venture, limited liability company, or partnership from 12 to 20, while maintaining the requirement that more than half of these shareholders, members, or partners must be qualifying relatives (as defined in existing law). The bill specifically amends Minnesota Statutes section 273.124, subdivision 8, which governs homestead classification for agricultural entities. Under this provision, these agricultural entities can still receive favorable property tax classification (class 1b or class 2a) for homesteads occupied by shareholders, members, or partners who are actively engaged in farming, even if the legal title is in the entity's name. The change allows more flexibility for family-owned agricultural businesses to maintain their corporate structure while preserving their eligibility for preferential property tax treatment. The bill will be effective for homestead applications starting in 2025, giving agricultural entities time to adjust their ownership structures to take advantage of the increased shareholder limit.

Budget and Finance

https://www.revisor.mn.gov/bills/bill.php?b=Senate&f=SF0776&ssn=0&y=2025