Mich. Admin. Code R. 206.26

Current through Vol. 24-19, November 1, 2024

Section R. 206.26 - Property taxes claimable for homestead property tax credit; sale of property; apportionment of taxes; computation of credit

Rule 26.

(1) Property taxes which may be claimed for a property tax credit are:

(a) Taxes based on the state equalized value of the homestead, including collection fees. Special assessments based on state equalized value may also be claimed.

(b) The property must be located in Michigan and be the principal residence of the claimant.

(c) The taxes shall be the taxes billed for the year the credit is claimed. For example, a property tax credit claimed for 1976 shall be based on taxes billed to the owner for 1976, usually in July and December.

(2) If the property is sold during the year, the taxes shall be apportioned between the buyer and seller according to the number of days in the calendar year that each occupied the house.

Example 1. The taxpayer sold his home in April, 1976, which he occupied until May 31, 1976. The property taxes for 1976 amounted to $600.00 (summer taxes $200.00, winter taxes $400.00) billed to the new owner in July and December of 1976. On August 1, 1976, he purchased a new home which he first occupied on October 1, 1976. The 1976 taxes on the new home totaled $800.00 (summer taxes $300.00, winter taxes $500.00). The taxes that may be claimed for credit are computed as follows:

_____________________________________________________________________

Computation Steps ______________________________	Homestead Sold ___________	Homestead Bought ____________________________
_______________ 1. Number of days occupied	152	92
2. Divide line 1 by 366 days	41.5%	25.1%
3. 1976 property taxes	$600.00	$800.00
4. Prorated taxes line 3 X line 2	$249.00	$200.80
5. Total taxes for credit		$449.80

The taxpayer rented a home for the period June 1 to September 30, 1976, and may also claim the 17% of tax in rent.

Mich. Admin. Code R. 206.26

1979 AC