If I sold a home and built a new home which was completed part way through the year, how do I compute my homestead property tax credit?
If you sold your home and moved into your new home, the property taxes for each home must be prorated based on number of days you owned and occupied the home as your principal residence. Complete part 3 of the MI-1040CR to determine the taxes that can be claimed for credit. Use the taxes levied in the year of the claim. The number of days used to prorate your credit may not exceed 365. If you sold a home, you must also include the capital gain from the sale of your home in total household resources even if the capital gain is not included in adjusted gross income.
Note: In the year the home was completed, the taxes levied on the home are based on the value of the land only. The following calendar year, the taxes are based upon the taxable value of the land plus the home.