Bill Text: MI HB4370 | 2021-2022 | 101st Legislature | Introduced
Bill Title: Property tax: exemptions; poverty exemption; modify. Amends sec. 7u of 1893 PA 206 (MCL 211.7u).
Spectrum: Moderate Partisan Bill (Democrat 24-3)
Status: (Introduced - Dead) 2021-03-02 - Bill Electronically Reproduced 02/25/2021 [HB4370 Detail]
Download: Michigan-2021-HB4370-Introduced.html
HOUSE BILL NO. 4370
February 25, 2021, Introduced by Reps. Brixie,
Slagh, Hope, Liberati, Breen, Steckloff, O'Neal, Young, Stone, Ellison,
Sowerby, Clemente, Hood, Garza, Scott, Aiyash, Cavanagh, Tyrone Carter,
Brabec, Morse, Thanedar, Howell, Hertel, Brenda Carter, Whitsett, Neeley
and Bellino and referred to the Committee on Local Government and Municipal
Finance.
A bill to amend 1893 PA 206, entitled
"The general property tax act,"
by amending section 7u (MCL 211.7u), as amended by 2020 PA 253.
the people of the state of michigan enact:
Sec. 7u. (1) The
principal residence of a person who, in the judgment of the supervisor and
board of review, by reason of poverty, is unable to contribute toward the
public charges is eligible for exemption in whole or in part from the
collection of taxes under this act. This section does not apply to the property
of a corporation.
(2) To be eligible for exemption under this section, a person
shall, subject to subsections (6) and (8), do all of the following on an annual
basis:
(a) Own and occupy as a principal residence the property for
which an exemption is requested. The person shall affirm this ownership and
occupancy status in writing by filing a form prescribed by the state tax
commission with the local assessing unit.
(b) File a claim with the board of review on a form
prescribed by the state tax commission and provided by the local assessing
unit, accompanied by federal and state income tax returns for all persons
residing in the principal residence, including any property tax credit returns,
filed in the immediately preceding year or in the current year. Federal and
state income tax returns are not required for a person residing in the
principal residence if that person was not required to file a federal or state
income tax return in the tax year in which the exemption under this section is
claimed or in the immediately preceding tax year. If a person was not required
to file a federal or state income tax return in the tax year in which the
exemption under this section is claimed or in the immediately preceding tax
year, an affidavit in a form prescribed by the state tax commission may be
accepted in place of the federal or state income tax return. The filing of a
claim under this subsection constitutes an appearance before the board of
review for the purpose of preserving the claimant's right to appeal the
decision of the board of review regarding the claim.
(c) Produce a valid driver license or other form of
identification if requested by the supervisor or board of review.
(d) Produce a deed, land contract, or other evidence of
ownership of the property for which an exemption is requested if required by
the supervisor or board of review.
(e) Meet the federal poverty guidelines published in the
prior calendar year in the Federal Register by the United States Department of
Health and Human Services under its authority to revise the poverty line under
42 USC 9902, or alternative guidelines adopted by the governing body of the local
assessing unit provided the alternative guidelines do not provide income
eligibility requirements less than the federal guidelines.
(3) The application for an exemption under this section must
be filed after January 1 but before the day prior to the last day of the board
of review.
(4) The governing body of the local assessing unit shall
determine and make available to the public the policy and guidelines used for
the granting of exemptions under this section. If the local assessing unit
maintains a website, the local assessing unit shall make the policy and
guidelines, and the form described in subsection (2)(b), available to the
public on the website. The guidelines must include, but are not limited to, the
specific income and asset levels of the claimant and total household income and
assets.
(5) The board of review shall follow the policy and
guidelines of the local assessing unit in granting or denying an exemption
under this section. If a person claiming an exemption under this section is
qualified under the eligibility requirements in subsection (2), the board of
review shall grant the exemption in whole or in part, as follows:
(a) A full exemption equal to a 100% reduction in taxable
value for the tax year in which the exemption is granted.
(b) A partial exemption equal to 1 of the following:
(i) A 50% or 25% reduction
in taxable value for the tax year in which the exemption is granted.
(ii) As approved by the state tax commission, any other
percentage reduction in taxable value for the tax year in which the exemption
is granted, applied in a form and manner prescribed by the state tax
commission.
(6) Notwithstanding any
provision of this section to the contrary, a local assessing unit may permit by
resolution a principal residence exempt from the collection of taxes under this
section in tax year 2019 or 2020, or both, to remain exempt under this section
in tax years 2021, 2022, and 2023 without subsequent reapplication for the
exemption, provided there has not been a change in ownership or occupancy
status of the person eligible for exemption under subsection (2), and may
permit a principal residence exempt for the first time from the collection of
taxes under this section in tax year 2021, 2022, or 2023 to remain exempt under
this section for up to 3 additional years after its initial year of exempt
status without subsequent reapplication for the exemption, provided there has
not been a change in ownership or occupancy status of the person eligible for
exemption under subsection (2), if the person who establishes initial
eligibility under subsection (2) receives a fixed income solely from public
assistance that is not subject to significant annual increases beyond the rate
of inflation, such as federal Supplemental Security Income or Social Security
disability or retirement benefits. Both of the following apply to a person who
obtains an extended exemption under this subsection:
(a) The person shall
file with the local assessing unit, in a form and manner prescribed by the
state tax commission, an affidavit rescinding the exemption as extended under
this subsection within 45 days after either of the following, if applicable:
(i) The person ceases to own or occupy the principal residence
for which the exemption was extended.
(ii) The person experiences a change in household assets or
income that defeats eligibility for the exemption under subsection (2).
(b) If the person fails
to file a rescission as required under subdivision (a) and the property is
later determined to be ineligible for the exemption under this section, the
person is subject to repayment of any additional taxes with interest as
described in this subdivision. Upon discovery that the property is no longer
eligible for the exemption under this section, the assessor shall remove the exemption
of that property and, if the tax roll is in the local tax collecting unit's
possession, amend the tax roll to reflect the removal of the exemption, and the
local treasurer shall, within 30 days of the date of the discovery, issue a
corrected tax bill for any additional taxes with interest at the rate of 1% per
month or fraction of a month computed from the date the taxes were last payable
without interest. If the tax roll is in the county treasurer's possession, the
tax roll must be amended to reflect the removal of the exemption and the county
treasurer shall, within 30 days of the date of the removal, prepare and submit
a supplemental tax bill for any additional taxes, together with interest at the
rate of 1% per month or fraction of a month computed from the date the taxes
were last payable without interest. Interest on any tax set forth in a
corrected or supplemental tax bill again begins to accrue 60 days after the
date the corrected or supplemental tax bill is issued at the rate of 1% per month
or fraction of a month. Taxes levied in a corrected or supplemental tax bill
must be returned as delinquent on the March 1 in the year immediately
succeeding the year in which the corrected or supplemental tax bill is issued.
(7) A person who files a
claim under this section is not prohibited from also appealing the assessment
on the property for which that claim is made before the board of review in the
same year.
(8) Notwithstanding any
provision of this section to the contrary, if the assessor determines that a
principal residence of a person by reason of poverty is still eligible for this the exemption under this section and the property was exempt from the
collection of taxes under this section in tax year 2019 or 2020, or both, the
property shall will remain
exempt from the collection of taxes under this section through tax year 2021
if, on or before February 15, June 15, 2021, the governing body of the local assessing
unit in which the principal residence is located adopts a resolution that
continues the exemption through tax year 2021 for all principal residences
within the local assessing unit that were exempt from the collection of taxes
under this section in tax year 2019 or 2020, or both. The local assessing unit
may require the owner of a principal residence exempt from the collection of
taxes under this subsection to affirm ownership, poverty, and occupancy status
in writing by filing with the local assessing unit the form prescribed by the
state tax commission under subsection (2)(a).
(9) A local assessing
unit that adopts a resolution under subsection (6) or (8) must develop and
implement an audit program that includes, but is not limited to, the audit of
all information filed under subsection (2). If property is determined to be
ineligible for exemption as a result of an audit, the person who filed for the
exemption under subsection (2) is subject to repayment of additional taxes
including interest to be paid as provided in subsection (6)(b). The state tax
commission shall issue a bulletin providing further guidance to local assessing
units on the development and implementation of an audit program under this
subsection.
(10) As used in this
section, "principal residence" means principal residence or qualified
agricultural property as those terms are defined in section 7dd.