MN Redemption Law Changes:  Creditors seeking to redeem their lien, mortgage or judgment interest in real property subject to foreclosure must now act more quickly.  Effective August 1, 2008, Minnesota Statute 580.24 was amended to provide that a creditor seeking to redeem must file and record its Notice of Intent to Redeem at least one week before the end of the redemption period.  The prior version allowed filing even on the last day of redemption and often made it difficult to determine who was in line for the successive seven day creditor redemption rights.

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The IRS recently clarified how a vacation home can qualify for a like-kind exchange.  While most people buy a vacation home as some sort of investment, the courts and the IRS have always argued for the denial of like-kind exchange status as such properties are not held primarily for investment purposes.  IRS Revenue Procedure 2008-16 (effective March 10, 2008) outlines safe-harbor provisions that allow taxpayers to enjoy the benefits of like-kind exchanges on vacation property. Generally, a taxpayer has to rent the relinquished and replacement property for more than 14 days for two years before and two years after the exchange.  Also, in the same four-year period, the taxpayer cannot use the property for personal purposes for more than 14 days or 10 percent of the days that it is rented, whichever is greater.  The rental amounts must be in line with fair market rental rates.

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Many homeowners unable to sell in the present real estate market have turned to renting their homes.  Caution should be exercised in the complex area of landlord/tenant rights, contractual requirements and licensure issues.  Indeed, tenants may even be entitled to free rent if rental licensure is required and not obtained.  See, Beaumia v. Eisenbraun.