Minnesota childcare centers often discover the seminary‑of‑learning exemption only after they receive a full commercial tax bill. The good news is that you can still appeal, even if you have never filed an exemption application with the assessor, as long as you meet the April 30 Tax Court petition deadline for the taxes payable year.
Why childcare centers can qualify at all
Under the Minnesota Supreme Court’s Under the Rainbow decision, a licensed childcare center can qualify as a seminary of learning if it is educational in nature, provides a broad general curriculum, and delivers that education in a thorough, accountable way. Counties and the Tax Court now use that framework to decide whether a childcare program looks and operates like a school, but those are merits questions—you can still get in the courthouse door on the appeal side while you are strengthening your educational proof.
Assessment year, taxes‑payable year, and the April 30 appeal deadline
Every Minnesota property tax year has two pieces:
- The assessment year (value and exemption as of January 2).
- The taxes payable year (the following calendar year, when you pay).
If you believe your property should have been exempt as of a January 2 assessment, Minnesota Statutes, section 278.01 lets you challenge the resulting taxes in the taxes payable year, as long as you serve and file your Tax Court petition by April 30 of that payable year. So, for taxes payable in 2027 (based on the January 2, 2026 assessment), the last day to file a petition is April 30, 2027.
That petition can raise exemption arguments even if you never filed the exemption application with the assessor.
Moin: Individuals own the building, S corp runs the center
In Moin v. Hennepin County, Farhad and Michele Moin owned two parcels personally and leased them to their S‑corporation, Moin Inc., which operated Mother Duck Learning Center, a licensed program that met the Under the Rainbow educational test. Hennepin County argued there was no concurrence of ownership and use because “the Moins don’t operate the center, the corporation does.”
The Tax Court disagreed and held that concurrence was satisfied because the same two people:
- Owned the real estate in their own names.
- Were the sole shareholders, officers, and directors of the operating S‑
- Had no other businesses and worked only in the childcare operation.
- Reported all center income directly on their individual returns via K‑
The court emphasized that it is immaterial that the operation is technically in the corporation’s name if the property is “actually owned and controlled by the same natural persons.”
If you own the building personally and run the center through a closely held corporation you fully control, your fact pattern may look a lot like Moin—and that case suggests a pathway to exemption when you appeal by April 30 for the relevant taxes payable year.
TKA: Single‑member LLC structures and missed applications
In TKA Investments LLC v. Olmsted County, a single‑member LLC owned two childcare properties and leased them to another LLC, also with the same sole member, that operated licensed childcare centers on the sites. The county conceded the centers met the Under the Rainbow educational test, but argued the ownership/lease structure blocked the exemption and also attacked the taxpayers for their handling of exemption applications.
The Tax Court relied on Minnesota Statutes, section 272.02, subdivision 35, which says property owned or operated by a single‑member LLC “shall be treated as if owned or operated by that member,” to find concurrence of ownership and use—effectively treating the sole member as both owner and operator for exemption purposes. The court also confirmed that a Chapter 272 application is not a prerequisite to a Chapter 278 petition for a constitutionally based exemption and that a timely April 30 petition can still be heard even if the county says the exemption application was late or missing.
If you hold the building in a single‑member LLC and operate the center through another entity you wholly own, your structure may resemble TKA. In that situation, a timely April 30 Tax Court petition can be a powerful tool even when the assessor insists your paperwork under Chapter 272 was defective.
HealthEast: The cautionary side of disregarding entities
The Minnesota Supreme Court’s HealthEast v. Ramsey County decision did not involve childcare, but it sets important guardrails on when courts will ignore separate entities. There, a healthcare system tried to treat an affiliated corporation as part of a larger charitable system for exemption purposes, even though that corporation did work and held property for outsiders.
The court held that separate corporate status will be disregarded only in “limited circumstances” and only when the entity has no purpose or existence apart from serving the exempt. Because HealthEast’s corporation did business with outsiders and had independent operations, its separate status could not be ignored, and the property remained taxable.
For childcare owners, HealthEast is a reminder that these more favorable Moin and TKA‑style results usually depend on tight facts: one owner, one business, one purpose—running the childcare center.
Duane Bojack: Charity exemptions and standing to appeal
In Duane C. Bojack v. Hennepin County, an individual resident at a nonprofit continuing‑care community challenged the taxes on his dwelling unit, arguing the property should be exempt as an institution of purely public charity under Minnesota Statutes, section 272.02, subdivision 7. The county argued, among other things, that he could not bring the case because he personally had not applied for exemption with the assessor.
The Tax Court rejected that argument, reaffirming earlier decisions that a Chapter 272 application is not always required before a Chapter 278 petition for a constitutional or purely‑public‑charity exemption, and holding that any person with an interest in the property can raise an exemption in a timely tax petition. The court then applied the factors for determining whether an entity is a purely public charity and partially granted his motion, keeping the case alive.
For childcare‑related nonprofits—especially 501(c)(3) centers with sliding‑fee or scholarship programs—Bojack signals that residents, operators, or affiliated entities with an interest in the property may still get their exemption arguments heard in Tax Court if they meet the April 30 deadline, even if the assessor never granted (or even received) a charity application.
Practical appeal path: from assessor to Tax Court and abatement
Once you think your facts look like Moin, TKA, Bojack, or a combination, you have a few main tools:
- Informal discussions. Meet with the assessor, bring your ownership documents, licenses, and program materials, and explain how your setup parallels these cases—while acknowledging that they are unpublished or limited‑precedent decisions that suggest, but do not settle, the law.
- Local or county boards. Consider a Local or County Board of Appeal and Equalization appearance in April to present a concise, visual story about why your property should be exempt.
- Tax Court petition by April 30. If the county won’t move, file a petition under Minnesota Statutes, section 278.01 by April 30 of the taxes‑payable year, asserting seminary‑of‑learning or purely‑public‑charity exemption (or both, if applicable). The cases above show the Tax Court will hear these claims and may grant relief even where the administrative route was incomplete or unsuccessful.
- Abatement for current and prior years. Separately, Minnesota Statutes, section 375.192 allows county boards to abate taxes on property that should have been exempt, often for the current and one or two prior years, based on a written request and a strong exemption package.
Moin, TKA, and Bojack are not silver bullets; they are unpublished, non‑binding decisions. Still, they show that Minnesota tax court is increasingly open to recognizing seminary‑of‑learning exemptions for closely held childcare structures and to hearing exemption claims—so long as you act before April 30.
Brendan M. Kenny is an attorney at Hellmuth & Johnson, PLLC, where he works extensively in administrative law and compliance. This includes representing childcare centers in licensing disputes, regulatory enforcement matters, and property-tax-exemption applications and appeals. Brendan can be reached at (952) 746-2139 or bkenny@hjlawfirm.com.
