Michigan Property Tax

Property taxes play a pivotal role in Michigan, impacting the state's financial ecosystem. Understanding the General Property Tax Act and the nuances of millage rates is vital.

Michigan property taxes are on the higher end nationally, with an average effective rate of 1.32% compared to the US average of 0.99%. This puts the state at 13th in the country for property tax burden. There is some protection for homeowners, though. The state constitution limits annual increases in taxable property value to a maximum of 5%. This means that even in a hot housing market, your property taxes won’t jump dramatically year-over-year. To estimate your potential property tax bill, you can use the state’s online property tax estimator tool.

Michigan Property Tax Exemption

Property taxes are a significant portion of Michigan’s state tax burden. However, the state offers a number of tax credits that help to mitigate the impact on residents. The most important is the Homestead Credit, which protects homeowners from being taxed out of their homes. This credit is available to all homeowners, regardless of income level.

The State of Michigan Department of Treasury’s Millage rate database and Property Tax Estimator allows you to compare your local property tax rates with those of other municipalities in the state. These rates are based on a formula that multiplies your property’s taxable value by the applicable tax rate.

Several programs offer exemptions for business property. Some are targeted to specific industries, while others focus on the development of distressed communities and high-tech facilities. The Michigan Department of Treasury also offers tax incentives to manufacturers that renovate or expand their existing plants. These facilities may qualify for a partial property tax abatement, depending on the type of manufacturing involved.

Michigan Homeowner's Principal Residence Exemption (PRE)
Michigan Property Tax 1

Michigan Homeowner’s Principal Residence Exemption (PRE)

The State of Michigan offers property tax relief for homeowners and renters who meet certain income requirements. This credit is filed annually with the individual income tax return. The amount of the credit depends on the comparison between property taxes and total household resources. To find out if you qualify, complete the Michigan homestead property tax credit claim MI-1040CR.

A homeowner’s principal residence exemption (PRE) exempts a house from the school operating tax levied by local governments in Michigan. The PRE is available to owners of single-family homes, including condos and townhomes, and to renters who meet the requirements. Cottages, vacation homes, property that is owned and rented to others, college dormitories and some commercial and industrial properties do not qualify for the PRE.

Michigan Property Tax Due Dates

A property’s tax status on “tax day” determines the following year’s values and taxes. The City, County and Townships have different due dates. City of Jackson property taxes are due by the 20th of each month from July through November. They can also be paid in full by September 14. Winter taxes are due December 1. If you qualify, you may defer your winter taxes until February 14 without interest.

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