Local Mineral Taxes and Property Taxes

see Aggregate Materials Tax

The Severed Mineral Interest Tax is a local property tax charged on any mineral interests owned separately from the surface land or real property above it.

Minnesota counties pay 20 percent of the amount collected to the Department of Revenue, which we deposit into the Indian Business Loan Account.

When are the return and payment due?

Minnesota counties must file a return and pay a portion of the tax collected twice each year.

• July 30 (period of January 1 to June 30)
• January 30 (period of July 1 to December 31)

How do I file a return?

You can file the Form SMI1, Severed Mineral Interest Return by mail.

How do I make a payment?

You can pay by check using a payment voucher. Mail your payment and return to Minnesota Revenue, Mail Station 3331, St. Paul, MN 55146-3331.

A  local Property Tax is assessed on unmined taconite or iron sulfides in any 40-acre tract of land if less than 1,000 tons of iron ore concentrate are produced from the land. The tax cannot exceed $15 per acre. If at least 1,000 tons of iron ore concentrate are produced, the land is exempt from the tax. Counties administer the tax based on market values supplied by the Minnesota Department of Revenue.

To determine the market value, we classify the unmined taconite as either “economic taconite” or “uneconomic taconite” by evaluating drill hole data submitted by the mining companies.

To be classified as economic taconite and given a market value of $500 per acre, the taconite must:

• contain more than 16 percent magnetic iron with the Davis tube test;
• contain less than 10 percent concentrate silica (SiO2) with the Davis tube test;
• have a 15- to 25-foot minimum mining thickness; and
• have a stripping ratio of less than four-to-one (waste/concentrate).

If the material fails any of the above criteria, then it is considered to be uneconomic taconite and given a market value of $25 per acre. Some lands may also be considered uneconomic due to environmental restrictions.

For more information on Unmined Taconite Property Tax, contact your county auditor.

See Ad Valorem Tax