Michigan Property Taxes
Overview of Michigan Property Taxes
Every homeowner in Michigan is required to pay property taxes every year. Like most states, Michigan property taxes are collected by local taxing authorities and are used entirely to fund local government functions. The state and its local governments collect $88 billion in total revenue every year. Of that total, $14 billion or 15.9% of total revenue comes from property tax. The Great Lake State is a high-tax state. Homeowners pay an average of 1.61% of their home value in property taxes or $16.11 for every $1,000 in home value. However, Michigan property tax rates can fluctuate from county to county.
Homeowners in Michigan are assessed every year by a local tax assessor. The assessment ascertains your home's assessed value, calculated at 50% of "true cash value" or the amount a random buyer would pay for your home in the current market. The assessor considers multiple factors when valuing your property, including improvements to the property, demolition of structures, and new construction. The assessed value is then multiplied by the tax rates set by taxing authorities depending on their budgetary requirement. For instance, if your home's true cash value is $300,000, the assessed value would be $150,000. If you multiply that with a tax rate of $10 for every $1,000 in home value, your Michigan property tax bill will add up to $1500 ($150 x $10).
The state of Michigan has a law known as "Proposal A" that caps annual taxable value increases by 5%. This means your home's assessed value cannot increase by more than 5% annually. However, the assessed value can go above the cap if you make tangible improvements to your home, for instance, adding a swimming pool. This would affect the amount of Michigan property taxes you owe. Michigan property tax rates are referred to as millage, figured in mills. A mill is equal to $1 for every $1,000 of taxable value. Therefore, you can calculate your Michigan property tax bill by multiplying your home's taxable value by the millage rate in your respective county.
If you are planning to buy a home in Michigan and want to understand how much your property tax bill could potentially cost, check out our Michigan Property Tax Tool to see what your bill would be.
Michigan Property Tax Due Dates
Homeowners in Michigan are assessed every year as of December 31st to determine their property's value. The state allows you to appeal property taxes if you have reason to believe that you have been wrongly assessed. However, you will be appealing the assessed value, not the tax rate. But when are Michigan property taxes due? Michigan property taxes are billed twice every year: summer and winter. Summer property taxes are billed on July 1st and can be paid without accruing interest through to September 14th. Winter taxes are billed on December 1st and payable by February 14th. If the due date falls on a weekend or legal holiday, it is pushed to the next business day.
Bills that remain unpaid by Michigan's property tax due dates result in a 3% penalty on the outstanding balance. Additionally, late payments result in a 0.5% interest on the outstanding balance. This interest is added at 0.5% every month until the taxes become delinquent. Unpaid Michigan property taxes plus additional penalties and interest are turned over to the County Treasurer for collection by March 1st each year.
It is noteworthy that the state doesn't offer a grace period from the due dates in which you should pay your property taxes. Additionally, failure to receive a Michigan property tax bill does not alleviate the tax burden. It is your duty as the homeowner to ensure your Michigan property taxes are paid in time. If you fail to receive a tax bill, or receive the wrong one, consult your local treasurer or assessor.
Michigan Property Tax Exemptions
Besides providing you with the option to appeal property taxes if wrongly assessed, the state of Michigan provides exemptions to ease the property tax burden on eligible homeowners. They include homestead and senior exemptions. It is noteworthy that the exemptions are not applied to the tax rates. Additionally, eligible homeowners are still required to comply with Michigan's property tax due dates.
Michigan Homestead Exemption
Michigan's homestead exemption protects your home's equity in case of bankruptcy. If you are a legal Michigan resident using the home as your primary residence, you can exempt up to $40,475 of equity under this exemption. The exemption can increase to $60,725 for elderly and disabled homeowners. However, the homestead exemption has no bearing on the accrual of Michigan property taxes.
Michigan Senior Citizens Exemption
Michigan senior exemption is also known as Homestead Property Tax Credit. Qualifying seniors receive a tax credit worth up to 100% of their Michigan property taxes that exceed 3.5% of their income, or $1,200. Senior residents can claim this exemption by filling the form MI-1040CR. The applicant or their spouse must be at least 65 years old by December 31st of the tax year and lived in Michigan for at least six months.
Other Michigan property tax exemptions include the disabled veteran exemption, which applies to the principal residence of a disabled veteran honorably discharged from the United States armed forces. The United States Department of Veterans Affairs has to certify that the veteran's disability is 100% related to military duty. Surviving, unmarried spouses of such veterans also qualify for this exemption. More information regarding these and more exemptions can be obtained from Michigan's Department of Treasury.
How to Appeal Your Property Taxes in Michigan
The state of Michigan provides homeowners with the option of appealing property taxes by disputing the assessor's valuation of their property. A successful appeal can significantly lower your Michigan property taxes. If you have reasons to believe that your home's assessed value is more than 50% of its true market value, you are required to visit the Assessor's Office with your complaints. This is an informal hearing in which you and the Assessor's office exchange documents and discuss how to rectify possible errors. If you disagree with the assessor, you must file an official appeal with the local county Board of Review. The Board's decision can be further appealed to the Michigan Tax Tribunal.
The process of filing an assessment appeal varies across Michigan though it generally follows the same steps from county to county:
- Obtain your assessment
- Determine if you are overassessed
- Complete forms needed to appeal
- File property tax appeal
- Prepare for hearing
- Attend hearing
- Appeal the decision
How to Appeal Your Property Taxes in Wayne County
To better understand how to appeal your property taxes in Michigan, the following is a breakdown of Wayne County's process, the most populous county in Michigan.
Obtain your assessment
If you own property in Wayne County, you can find your assessment details on your Notice of Assessment and Taxable Value. Alternatively, you can visit the Wayne County Assessor's Office.
Determine if you are over-assessed
A good basis for the appeal is evidence indicating your property's assessed value exceeds 50% of True Cash Value. Michigan's Department of Revenue has an easy-to-use property tax estimator that can help you compare property taxes with other local units within Michigan. Alternatively, you can use TaxProper's search tool.
Complete forms needed to appeal
The appropriate property appeal forms will be provided to you at the Assessor/Treasurer's office. They can also be obtained from the Department Of Revenue.
File property tax appeal
Property tax appeals in Wayne County can be filed with the March Board of Review, which sits in March each year. However, the Board can also meet in July or December or both July and December, if there is business to conduct.
Prepare for hearing
The assessor is presumed to be right, and as the appellant, the burden of proof lies with you. You are required to provide evidence proving your opinion of value. This can include comparable sales of similar properties, quality and type of construction, images of disrepair on your property, and other negative influences like access or lack thereof.
The Board requires you to attend your property tax appeal hearing in person. However, you don't have to participate if you file a Personal Property Statement to the Michigan Tax Tribunal before the Board of Review commencement.
Appeal the decision
The Board of Review typically mails you their decision on your appeal case four weeks after adjournment. You can appeal the Board's decision to the Michigan Tax Tribunal by July 31st.
Property Tax Information for Michigan Counties
The table below provides county-level information about how property taxes work in each Michigan county.
Want to learn more? Click the county links to learn more about a specific Michigan county.
|County||Average Home Value||Average Tax Bill||Bill per $1,000|
|Grand Traverse County||$213,282||$2,591||$12.10|
|Presque Isle County||$126,208||$1,343||$10.60|
|St. Clair County||$144,548||$2,052||$14.20|
|St. Joseph County||$134,762||$1,579||$11.70|
|Van Buren County||$148,794||$2,065||$13.90|