Tax Appeal In Michigan?

Question

Has anyone appealed property taxes in Michigan? What is this process like?

Ashish Acharya · Answer

@Shaun BeckKevin's breakdown is solid, and Michigan actually has a system-specific wrinkle worth adding to it. Since Proposal A passed in the 90s, Michigan tracks two separate numbers, your assessed value (technically SEV, State Equalized Value, meant to be 50% of true cash value) and your taxable value, which is what your tax bill is actually based on. Taxable value is capped from rising more than the rate of inflation or 5%, whichever is lower, each year, until the property sells, at which point it "uncaps" and resets to match the SEV. So depending on how long you've owned the home, your taxable value might already be well below your assessed value, and appealing the assessed value alone might not move your tax bill much if there's a big gap between the two, worth checking both numbers on your assessment notice before deciding it's worth the effort.

From a tax side more broadly, Kevin's point about errors in the underlying facts (square footage, lot size, etc.) is the strongest lever, that's an objective, easy-to-win argument versus a comps-based valuation dispute, which is more subjective and can genuinely go either way. One more thing worth knowing: if you do get your assessed value reduced, that can affect your property tax deduction on your federal return going forward (subject to the SALT cap), so it's a minor knock-on benefit beyond just the annual savings, not the main reason to appeal, but worth knowing it compounds.

Drew Sygit · Answer

Have done it many times.

You can typically ONLY appeal when you get your assessment around February-March and you have a limited amount of time to do so.

Most cities supply pretty good instructions on their websites.

Jason Malabute · Answer

A few Michigan-specific things worth knowing before you appeal. Since Proposal A, your assessment actually has two numbers: the SEV (State Equalized Value), which is meant to be about 50% of your property's true cash/market value, and the taxable value, which is what your tax bill is really calculated on. The taxable value can only climb each year by the lesser of inflation or 5% while you own the place, then it uncaps and resets up to the SEV the year after a sale. So check both numbers first, because if there's a big gap between them, appealing the assessed value alone may not move your bill much. When you do appeal, a factual error in the assessor's record (wrong square footage, wrong lot size, features you don't actually have) is usually your strongest and most objective argument, whereas a comps-based value dispute is more subjective and can go either way. And timing is tight: assessment notices come out late February/early March and your first stop is the local Board of Review in March, so don't sit on it.

Jeff Roth · Answer

Hi Shaun-

Great question! When you receive your property tax assessment notice late February or early March, there will be a date in March for the Board of Review locally to review property tax assessment disputes.

You can ask your Realtor partner to provide recent sold comparables for your property to document if you feel your property is assessed too high. No guarantees but showing lower comparable sales helps support your appeal. Sometimes the information is incorrect as well they have for your property in the assessment record and you can bring neutral third party verification of those details as well like a property inspector or property appraiser.

If unsuccessful, and still feel you have a strong case, you can appeal the local Board of Review decision through the Michigan Tax Tribunal process but this is more costly and you may want to have an attorney help you file the appeal so the potential benefits have to outweigh the costs.

To Your Success!

Kevin Sobilo · Answer

@Shaun Beck, I can't speak to Michigan specifically but I can give some general thoughts:

1. First off you are not appealing your property taxes. You are appealing the assessed value of your property that is used to calculate your property taxes.

2. Maybe the first question to ask yourself, is do you think the assessed value is unreasonable when compared to the valuations of similar properties around you?

If the valuation is consistent with other similar properties, you may wish to lower your expectations.

3. I am not sure about Michigan, but here in PA, it is theoretically possible to appeal the assessed value and for the valuation (and taxes) to GO UP!!! I'm sure it is VERY rare, but keep in mind that you want to make anything you present sound reasonable.

4. I always start by reviewing the FACTS and by that I mainly mean the detailed information the assessor has about the property. The lot size, utilities available, the size of the house, etc etc etc.

If you can find an ERROR in the facts, you have a VERY clear cut argument to reduce your assessed value.

For example, I appealed an assessment once on a house where I found they had it listed as being 10% larger than it was. (Note: when you measure a house you count everything within the envelope of the house including the thickness of the exterior walls). What happened was they counted an unfinished utility room space that was below ground and more like a basement (house built into side of a hill). That made it EASY for me to explain and get a significant reduction.

5. You can also pay to get an appraisal of your house or if you have the wherewithal pull together some good comps for it and make your case with those. There is some subjectivity to the comparison process, so you or may not get what you hope from this effort.

Tax Appeal In Michigan?

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