Michigan Homestead Exemption Expanded

Michigan MapMichigan homeowners need to be aware of the new law that went in to effect for homeowners who have moved and have not been able to sell their home in Michigan.

The law is called PA 96 of 2008, and it is a huge tax break for people in Michigan that expands the Principal Residence Exemption on unsold homes. If you live in Michigan, and own a home you are allowed to claim one house for a primary home exemption.

Now the legislature has allowed you keep two exemptions “if” you move from one home in Michigan to another one and are still trying to sell the previous home. The home must be vacant and for sale.

Some of the requirements are:

•1)      The home owner must file a Conditional Rescission of Principal Residence Exemption form #4540. This is a live document and you can fill it out on line and email it.

•2)      The bill was NOT passed until April and the deadline was May 1st. It was a narrow opportunity to get the message out. So now the legislature has extended the deadline and you can file and appeal with your communities board of review.

•3)      The appeal will only be for 2008, and you will need to file each year until your home sells. Currently the tax savings on the Principal Residence Exemption is for 3 years.

•4)      For more information you can check out the Michigan Department of the Treasury.

Although the government, passed this law for homeowners in Michigan to be able to move up and keep the housing market moving, as a Realtor is also helps when buyers are looking at homes. If they are choosing between 2 homes and one home is homesteaded and one is not it makes a huge difference in the new buyers payments until they can file for the May 1st deadline.

Here is an example in Ann Arbor Michigan for a home priced at $ 270,000. A home without the homestead exemption would have taxed of $ 7989.00 and a home with the homestead exemption would have taxes of $6236.00.

Check out your home's evaluationIf this is not the size of the home you are purchasing you can go to the Michigan Property Tax estimator and put in the price home you are purchasing. Make sure you do ½ the sales price.

Any questions contact:

Missy Caulk 734-821-0757 or email (preferred) missy at missycaulk dot com.

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4 thoughts on “Michigan Homestead Exemption Expanded

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