Renters Refund: How to Apply for This Tax Credit

A renter’s refund is a state-level tax credit or payment designed to lessen the property tax burden for tenants. This is not a federal program, and its availability is limited to a handful of states. The purpose is to return a portion of the property taxes paid by a landlord to eligible, lower-income renters, making housing more affordable. The structure of these benefits varies significantly by state, with each setting its own rules for who qualifies and how much they can receive.

Determining Your Eligibility

Eligibility for a renter’s refund is contingent on meeting several criteria established by the state offering the credit. These requirements revolve around residency, income, and the type of property rented. Using Minnesota’s Renter’s Credit program as an example, a claimant must be a resident of the state for the entire tax year.

Income is a primary factor for these programs. States establish a maximum household income threshold, which can be adjusted annually. To claim the Minnesota credit in 2025 (for rent paid in 2024), a renter’s household income must be less than $75,390. Household income includes the federal adjusted gross income (AGI) of the filer, their spouse, and any other adults living in the rental unit.

The nature of the rental property is also a factor, as the building must be subject to property taxes. This means individuals in properties exempt from local property taxes, like some public housing or university dormitories, are often ineligible. Common disqualifiers include being claimed as a dependent on another person’s tax return or living in a medical care facility, such as a nursing home.

Information and Documents Needed to Apply

The primary document needed is the Certificate of Rent Paid (CRP). The CRP is an official, state-specific form that your landlord is legally required to provide to you by January 31st each year. This document details the total rent you paid during the preceding year, the property owner’s information, and the property identification number.

If your landlord fails to provide a CRP, you should make a formal written request. If that does not work, most states offer a substitute form, like a Rent Paid Affidavit (RPA). This allows you to self-certify your rental payments but may require additional proof and could delay your refund.

You will also need income documentation for all household members. This includes:

• Federal and state tax forms like W-2s and any 1099 forms.
• Statements for non-taxable income, such as Social Security benefits.
• Social Security Numbers or Individual Taxpayer Identification Numbers (ITINs) for yourself, your spouse, and any dependents.
• Bank account and routing numbers for direct deposit.

Calculating Your Potential Refund

The amount of a renter’s refund is calculated on a sliding scale that weighs your total household income against your rental payments. States use a formula to determine the portion of your rent that is considered to be for property taxes. For example, a state might define 17% of your gross rent paid as the amount attributable to property taxes.

The refund is calculated based on how this property tax amount compares to your income. As your income increases, the refund amount decreases, eventually reaching a point where no refund is available. The maximum credit in Minnesota for the 2024 tax year is $2,640, but this amount is only available to those with very low incomes.

Because the calculations can be complex, states provide resources to help you estimate your refund. The official refund tables in tax form instructions and online calculators on state department of revenue websites are the most reliable tools for an accurate estimate.

The Application Process

The specific form required varies by state. For example, in Minnesota, the credit is claimed on Schedule M1RENT, which is filed with the main state income tax return. Most states offer electronic and mail filing options. Online filing through the state’s tax portal or approved tax software is the most efficient method.

When filing online, you will be guided through entering information from your CRP and other documents, and the system will calculate the credit for you. Alternatively, you can download the correct forms from the state’s department of revenue website and file a paper application.

When filing by paper, you must attach physical copies of all required documents, including the CRP. Failing to include these attachments is a common reason for delays or denial. Be mindful of the filing deadline, which is often the same as the state income tax deadline. After submitting, you can often track its status through a “Where’s My Refund?” tool on the state’s website.