Household income includes all income received by all household members during the year, including income that might be exempt from federal adjusted gross income. For a complete listing of income sources to include in HHI, see Income and Deductible Items

Checklist For Determining Household Income

Some qualified paid health insurance premiums may be deducted from household income to compute the homestead property tax and other credits allowed on the Michigan income tax return.

Qualified Health Insurance Premiums

For those who received Family Independence Program (FIP) Assistance From the State of Michigan or other public assistance, you may be eligible to claim a home heating credit if you owned or rented a homestead in 2011. If you owned or rented only part of the year, you must prorate your credit. See instructions for a part-year owner or renter on page 5 of the MI-1040CR-7.

If you receive FIP assistance, State Disability Assistance (SDA), or you are enrolled with the Department of Human Services (DHS) for direct payment, by law Treasury must send your credit directly to your heat provider.

If your heat is provided by DTE Energy, Consumers Energy, or SEMCO Gas, your home heating credit may be sent directly to your heat provider. (See instructions for line 43, page 8 of MI-1040-CR-7)

If, at the time you file this claim, your heating costs are included in your rent or your heat service is in someone else's name, your credit must be reduced by 50 percent. Your credit will be issued as a check, rather than an energy draft (see lines 5 and 35 of MI-1040CR-7).

View Special Situations Information

Rent Assistance - If any portion of your rent was paid on your behalf by MSHDA, or any other governmental agency,  you are only allowed to claim the portion of your rent that you actually paid.  Do not claim any amount that was paid on your behalf by MSHDA or any other governmental agency.

Moved during the year - If you moved during the year and you rented, use rent from both residences to determine the total amount of rent paid. The combined rent should not be for more than 12 months. If you bought or sold your home, you must prorate your taxes between the locations. See the instructions for the MI-1040CR for more specifics.

Mobile Home Park Resident - You may claim $3 per month (12 months x $3 = $36) for a total of $36 and 20% of the yearly rent amount less the $36 (total yearly rent - $36 = lot rental without property tax; x 0.20) for the total amount. If you paid additional taxes on attached buildings (garage, tool shed, etc.), then you may also claim that amount.

Public Housing - If the owner does not pay property tax or a service fee, you are not eligible to claim a property tax credit and a credit will not be issued.

Service Fee/Pilot (payment in lieu of taxes) Housing - a program where there is an agreement between a municipality and a rental property owner (private or public) to pay a service fee instead of property taxes. You can find out if a property is subject to Service Fee/Pilot housing by contacting the landlord/management company. Often, the Service Fee/Pilot Housing is low income or senior citizen housing that can include apartment occupancy or the rental of a single family home.

Important Note: It is the renter's responsibility to determine if the rental property is Service Fee/Pilot Housing before claiming a credit. Service fees are typically less than property taxes. The Income Tax Act provides that a renter living in Service Fee housing must calculate the property tax credit at 10%.  FAQ's for Service Fee/Pilot Housing

Alternate Property Tax Credit for Renters Age 65 or Older: An alternate credit is available only to renters age 65 or older whose rent is more than 40% of their household income. To calculate the alternate credit, subtract 40 percent of your household income from the total rent paid for the year. Renters who qualify for the alternate credit are encouraged to calculate the credit using both the standard and alternate methods to determine which gives them the larger credit. The larger credit should then be claimed. To determine if an individual qualifies for the alternate credit refer to worksheet 6 in the Michigan 1040 Individual Income Tax booklet

Important Note: If your rental property is considered Service Fee/Pilot Housing you may not use 20% of your rent when calculating the Homestead Property Tax Credit. You may only use the percentage of your rent as property taxes that the landlord/management company tells you they are paying as a service fee, up to a maximum of 10%, when calculating the credit.

Nursing Home, Home for the Aged and Adult Foster Care - If the facility pays local property taxes, you may claim your portion of those taxes for credit. You may not claim rent or monthly fees for the property tax credit amount. If both you and your spouse live in the facility, add your shares together.

If one spouse lives in a nursing home or foster care home and the other spouse maintains a home, you may file a joint credit claim. Combine the tax for the homestead and the share of the facility's property tax to compute your claim.

If you are single and maintain a homestead (that is not rented to someone else) while living in a nursing home or adult care facility, you may claim either your homestead or your share of the facility's property tax, but not both. Use the one that gives you the larger credit.

Cooperative Housing - Ask to see a statement from the co-op giving the amount of taxes or the percentage of your monthly payment that is considered tax on your unit. Use your share of the property taxes on the building and 20% of the rent paid if the co-op is on leased land.