Preliminary information for the Wholesale Marihuana Tax is now available.
Marihuana Retailers Excise (MRE) Tax
Homeowner's Principal Residence Exemption
Property Tax Forfeiture and Foreclosure
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In 1994, Michigan voters approved Proposal A, a major reform of the state’s school funding system. Proposal A replaced local school operating millages with a 6-mill State Education Tax and allowed local school districts to levy up to 18 mills for operating purposes. To protect homeowners and reduce property tax burdens from the full impact of these changes, the principal residence exemption was created under MCL 211.7cc and MCL 211.7dd. The principal residence exemption exempts an owner’s principal residence from the local school operating millage, up to 18 mills. This exemption is distinct from the Michigan Homestead Property Tax Credit, which applies to income tax returns.
MCL 211.7dd(c) defines principal residence as the one place where an owner of the property has his or her true, fixed, and permanent home to which, whenever absent, he or she intends to return and that shall continue as a principal residence until another principal residence is established. It also includes all of an owner's unoccupied property classified as residential or timber-cutover that is adjoining or contiguous to the dwelling subject to ad valorem taxes and that is owned and occupied by the owner.
A principal residence exemption under MCL 211.7cc and MCL 211.7dd provides significant tax relief for homeowners but is strictly governed by statutory definitions and procedural requirements.
To qualify for a principal residence exemption on a fixed and permanent home, MCL 211.7cc requires that the property must be: owned by a qualified owner as defined by MCL 211.7dd(a); occupied as a principal residence by that owner of the property; free of disqualifying factors under MCL 211.7cc(3) apply; and claimed by the owner of the property by filing an affidavit with the assessor in which the property is located. For adjoining or contiguous parcels, eligibility requires that the property must be: owned by a qualified owner as defined by MCL 211.7dd(a); unoccupied; contiguous to the parcel containing the property owner’s principal residence; classified as residential or timber-cutover; and claimed by the owner of the property by filing an affidavit with the assessor in which the property is located.
Understanding these requirements is essential for compliance and for resolving disputes regarding exemption eligibility.
In all cases, the owner bears the burden of proof to establish eligibility for the exemption. Stege v Department of Treasury, 252 Mich App 183, 189; 651 NW2d 164 (2002).