Michigan Property Taxes Are Being ELIMINATED!? 

When you meet with prospective clients, do showings, assist them with the purchases of new homes are you counseling or advising your clients on how to estimate their prospective NEW property tax bill, or just letting them find out after the sale?

Great question @ralphjessee2688 I always advise my clients on how to estimate their taxes and let them know that the tax amounts on home listings, Zillow, etc. are based on the current owners taxes and not yours when the uncapping occurs. My estimates are usually higher than what they come out to be so they can plan for the worst and hope for the best.

Consider this: In Michigan, real property classified as Agriculture - improved or not, UNLIKE residential either improved or unimproved, DOES NOT come uncapped (with few exceptions). (The big jump most homebuyers experience is due to UNCAPPING, causing the (value) basis to substantially increase. The next effect is the taxable, assessed, and state equalized value can all be substantially higher on a 3/2 on a city lot for 3,4,5,600K+ vs. 100 acres of cropland that sells for $7,500.00 an acre. For example, a 3/2 in Birmingham sold for $750,000.00 and will be taxed at or around the purchase price. The cropland sold for $750,000.00 also, but the new owner keeps the sellers basis. (Neither the new owner's taxable value, nor amount of tax will increase) The result - Whether you qualify for a PRE, or not, the Residential property is going to pay much, much more than the equally valued (dollar basis) Agriculture property. Do you think there is more tax revenue coming into the state via Residential or Agriculture property?

The local authorities don't do their job. They make the home owner do all the repairs even including the roads.

Michigan needs to get rid of townships. I lived in Indiana and NY and they don't have twps.

Businesses already pay a plethora of other taxes, why property? its PROPERTY or RENT? do we rent from the Crown?

I agree. Primary home should not be taxed ot at the very least taxes should be much lower. No way should people be paying insanely high taxes after an uncapping with the insane rise in home prices. That punishes not just first time home buyers, but someone who moves within the state of Michigan to another home whether a side grade upgrade or downsize. The rate needs to be lower and the taxable value cap at 1995 (First year of taxable value cap being set on 1995 SEV) after Proposal A was passed in 1994) or 2010-2013 value plus inflation or 5% whichever is lowest only for primary home owners where the home owner lives in the home. If home is a vacation home not even rented out, have no capping at all and always make them pay on SEV. If it is an investment property, cap it upon ownership but uncap upon sale to another investor/rental. Reason I say cap investor who rent them out is to prevent runaway rental prices, But uncap upon landlord rental ownership change. If a rental or investment home is sold and changed to a primary ownership home form the buyer and they did not own it since 2012 or before, roll back taxable value cap to SEV of 1995 or 2010-2013 plus inflation per year or 5% per year whichever is lowest. If a transfer goes to another landlord who rents uncap and cap at new SEV as long as they rent it out. If they take it out of rental and hoard property or use as vacation 2nd home only, have no cap at all, If that owner person then decides to move into the property and sells all other property and thus this becomes primary home, roll back SEV to 1995 or 2010-2013 plus 5% or inflation whichever is lowest, Point is primary homes should not be taxed more than taxable value and no uncapping of 1995 or 2010-2013 values whichever is lowest,

Nobody should have to pay property tax.....Forever renting? How evil. You never know when the crap will hit the fan and you are drowning. Where I live unprepared food, water, and medicine have non tax and it is because these things are considered necessities.....isn't shelter a necessity? Yes. IT IS.

Here's an idea to DOUBLE what ya pay in State Income taxes, and greatly increase sales taxes.

not only that.... the fact that i have to pay a FOREVER tax for an improvement on my house is LUDICROUS. Stopping property taxes will increase the desirability of living in michigan and booming the economy. The people that say otherwise just want to make people tax cattle and as such, slaves.

@highlanderc I agree. Usually, that only happens if you increase the sq footage though. .

@@backrack01 Yes only to an existing property you live in. But with skyrocketing home prices, if you lived in a home for a long while, try selling it buy a different home. It uncaps and is reset to new high home value and taxes massively higher. Many who move are not aware of this until they see it happen and wonder why their taxes are so much higher than neighbors.

What are your thoughts for doing so?

Find a petition near you! Join axmitax.org for more info or facebook.com/groups/1365882604338310/?ref=share&mibextid=NSMWBT , sign to get it on the ballot in November...

@@LivingInMichigan It reduces the impacts on gentrification. With property taxes gone, existing residents can breathe freely, especially if their mortgage is paid off. It will also reduce rent hikes due to gentrification.

@@natep6729 Agree, Though eliminating them totally would probably be a bit much. The rate needs to be lower. Proposal A caps property tax even if home prices rise much faster than inflation which they have the last 10 years, That is only if home owner keeps ownership of the home. But upon the sale and new owner, it uncaps to SEV (half market of true cash value) the following year and taxes massively go up in a rising home value market. Then they are capped but at that new insanely high value and taxes. What they need to do is make the taxable value cap permanent at 1995 or 2010-2013 values plus 5%/inflation whichever is lowest only for principle/primary residence owners where the home owner lives regardless of how many times it sells or ownership changes. For secondary/vacation and investment/rental homes, keep the same process of uncapping upon ownership change but cap until next ownership change. Also reduce some mileages so the rate is lower and modest 1300-1700 SF home are paying $2000 in property taxes instead of $3400 to $3900 even with the cap in place let alone the insane $$5800 to $6500 after an uncapping. And larger homes 2000 SF to 3000 SF instead of the insane $7500 to $10K in taxes, more like $3K to $4K even capped let alone what they would be uncapped. People need to feel like they own their homes and perpetual payment should be as low as possible for a modest home and much over $2K is really a little too much for a modest 1300 to 1700 SF home.

@@LivingInMichiganHe’ll yes, get rid of it in ALL 50 states!

Hey Eric, explain to us all here how you have no idea how schools and public services are funded, without actually saying you have no idea how schools and public services are funded…

I would also vote to have no schools or roads.

They're filling every resident lost with illegal immigrants... How convenient now that they'll be removing property taxes... All younger families can't get a home... But these illegals who have everyone paying for everything will be able to afford a house just fine. 😡

So in other words you tax the poor more disproportionately as a percentage to their income

@@markreeves6970 No. Sales Tax is the fairest tax we have. The more money you spend the more you pay. The poor don’t spend much while the rich do. No loopholes either. The problem with sales tax is citizens can’t be spied on by the government as easily; Al Capone would have gotten away with his crimes.

@@markreeves6970 it’s like a luxury tax. Everyone has to pay property taxes. Even when renting. The landlord pays property tax and passes it on in rent. Taxing by sales tax is, for the most part, a luxury tax. Essentials are taxed at a lower rate and there are tax free days provided for back to school necessities. I would rather pay a little higher tax on items that are extra for me. If things are tight, I can cut back on them, but I can’t cut back on property taxes. They are always there.

Who uses a library lol

They obviously CONSERVE their people, beautiful families, and beautiful community! You'll never go wrong when you conserve yourself, family, and communities! Go woke and you go broke. Facts and statistics don't lie!

I would say their response to that is, “it costs money to make money”

And they do, when it buys them more votes.

What did they ever do before property taxes

@@skylarsartnphotography3450 they probably didn't have bloated government salaries to pay for things like transgender sensitivity training

Property taxes have been around since before the country was founded, but before the mid to late 1800s they didn't have to pay for public schools, buses, police or fire departments, etc. because a lot of the services that property taxes pay for either didn't exist at all or were privately funded (Fire departments were either volunteer or paid for by insurance companies; if you didn't pay for the insurance, they wouldn't come to put out your fire!)

I'd even go so far as to say that you have to pay property tax while you have a mortgage, while you have kids in school and if you live somewhere else. If you don't fall into those categories or you're retired your primary residence should be tax exempt. It's EVIL to throw people out of their homes, especially elderly people. It really is EVIL.

So you’re saying remove property taxes and make sales tax 12%, so if you’re someone who spends more it’s on you?

OR make RENTERS pay a tax. This would also encourage property ownership instead of Renters always voting against landowners because they like having a "free ride" when it comes to all the other responsibilities.

@@LivingInMichigan Why do you want my money at the threat of taking my house? If you love taxes so much i am sure that even if they are eliminated you can still donate them to the city. You are welcome to do so.

The sales tax should be increased. I would rather pay higher sales tax than be solely responsible to pay for schools etc just because I have a home.

Yes, these socialist programs are just another form of theft.

I would vote to eliminate property taxes when they boot the illegal immigrants out of our state.

@@axiomaticidioms3857 So while they're here you'd like to continue to support them with your property taxes...got it.

Someone with common sense. Too bad you're not in charge.

@WhiteKitta Agreed 100%👍👍

This would be the solution but they will keep their garbage spending and cut the things we need.

@@Khaos-y7n OMNIBUS BILL

Fair. With parents taking on the full burden of k-12 education, what do you think about the potential of a drastic population decline as people avoid that bigger financial burden? (Deaths increasingly outweighing births)

@@LivingInMichigan My parents paid for my K-12 education. It makes perfect sense to me.

Oh boy, Chad here we come.

100% agree❤

@@LivingInMichigan isn't this what is happening already? Taxes are a huge portion of it.

Or Florida can increase the homestead tax exemption from $50K to $500K

This is being discussed also. Not $500k but it’s being talked about.

renting from the crown.

Yes thats very true. How can you ever truly own something outright for a mandatory yearly payment or it will be taken away from you.

💯% agree! You don’t continue paying for what you own. You know how RICH I would be if I taxed people’s basic needs like; Housing, transportation (Vehicles), Electricity and Water?? Government is a parasite and people are just fed up with it in this country.

Why so black and white you can still have property tax but make it very low and not bided by the value this way u can still fund all these services.

How about reducing the size of government and eliminating socialist programs.

indiana's property taxes are considerably lower than here.... considerably.

Only if you completely eliminate property tax which then means investment firms can hoard home and land and pay nothing to occupy them only risking no insurance that home burns down which is an unlikely thing anyways. Tax secondary/vacation/investment/ non homestead homes. For primary homestead homes where people own and live in them, hav eno property tax regardless of age mortgage or not. Thats the purpose of home ownership is being able to have peace of mind of calling it your own while living there and having no rent or mortgage payment hanging over your head. Property tax is a kind of rent so ax it but once again only for primary home owners principle residence homestead. Not for secondary investment and vacation homes or like you said property gets ore expensive as rich millionaire/billionaire people and investment firms can buy lots of and hoard property while paying nothing to keep it.

that 2.5% a year is like you said... 25% of your payment. its not a 2%. It should be a 7% total and that is it... whether you pay it in the first 2/3 years or rolled into the mortgage, just like a car.

That's why you eliminate property taxes only for primary residence homestead for the one home an individual owns and lives in. Keep property taxes for 2nd homes and investment properties to prevent China and Bill Gates and like from buying up land and hoarding it.

I bought my home in 2013. Michigan has proposal A. My taxes jumped a little but not that bad after uncapping at the very beginning of home price rebound in its infancy. But my taxes would be like 1500 to $2000 more if I purchased home today after uncapping. I will never move as such. Really they need to make the proposal A property tax value cap permanent for primary residences and have the uncapping be only for ownership transfer of secondary homes. Otherwise it discourages moving and you cannot move without a huge property tax jump unless we have another collapse of home prices again like 2008-2009 level.

Fire can be picked up by insurance companies which are raking in huge amounts of profits and there shouldn't be an increase. Don't pay that insurance, fine, you don't get the fire put out. Pay for what you use. Police is not your friend anyways. Look how HOA deals with people and its not different than government... a bit of power and they want to own you.

I already pay for my own trash and snow plowing. If the roads aren't safe, stay home.

I don't need 30 new parks every year that are completely unused. I don't need to pay for schools if i dont have kids. Why do i always have to pay for something i don't get a benefit from? As a matter of fact, I pay 10k a year and don't even get trash picked up.

Yes, from the rich to the poor

I'm tired of income taxes... And I'm tired of illegal immigrants getting handouts that will be put on the backs of the citizens. 😡

@@JustDItY Property tax is also a burden on the poor. It’s hidden in your rent.

@@ThomasChristie-t9f Yes, that could be said for all taxes. Some are just more regressive than others. Few are as regressive as sales tax.

texas has huge property tax, they don't have income tax.

@@highlanderc Yes very true. Their property taxes are horrible. Much rather have income tax than property tax any day.

What's your thoughts on going that route?

The taxes on gas that were raised 3 times were supposed to pay for the roads. But the money disappeared and the roads still didn't get fixed.

Well Michigan have Proposal A which is very similar. Problem is it uncaps upon transfer of ownership in property. California Prop 13 does the same thing. Though California does allow those 55 and older to move and transfer their Prop 13 protection to another house. Michigan has no such thing so they should copy that but make it any age not just 55 and older. Allow at least one transfer. Better yet Michigan and California should make proposal A and Prop 13 caps permanent even upon ownership transfer no matter how many times as long as its a primary homestead residence. Only uncap upon ownership changes of secondary/investment/vacation homes and keep it capped until ownership changes again for non primary homestead homes. If investment/rental/vacation homes change to primary home, roll back the SEV to the lowest capped value of 1995 or 2010-2012 plus 5%/inflation per year, whichever is lowest. Or if homestead changes to a non-homestead, roll up the SEV to last ownership change and tax on that. Rinse and repeat as often as needed. That is for Michigan. For California Prop 13 do the same thing except its 1978 and 2% cap no matter what.

And change where the taxes are allocated and the percentages.

Make Proposal A cap permanent for primary residence owners at 2011-2012 price levels or 1995 price levels plus inflation whatever is lower regardless of how many times you move. Make only secondary and non primary homes and rentals have uncapping in addition to the non homestead increased millage.

Thats propsal A. I think Headlee requires millage rollbacks and also allows uncapping in a 1year delay.

DO not eliminate income taxes. Yes eliminate property taxes. Income taxes are a fact of life and you get to keep income not taxed on by stashing it in savings account. Property taxes in a recurring payment on something you own regardless of income and you thus cannot really own it. I would increase income tax a little and eliminate property tax. That way you can really own your home or land. Increased income tax offsets elimination of property taxes for revenue for schools cities and counties. Michigan could be a huge leader just getting rid of property taxes as no state has no property taxes. Income taxes are just a thing of life and not never ending and you just subtract the taxes withheld from income and that is your income and you keep it. Property tax means perpetual payment on your shelter just to keep it. That is a much worse tax. Federal has income taxes only and no property taxes unlike states and cities.

@@Wolverine607 You need to study history and the implementation of a “income tax.” Income taxes are not part of life, taxation is theft especially when I don’t have a choice on rather to pay or not. Also I’m in favor of sales taxes to fund governments not income or property tax. Sales tax allows the taxpayer to choose there tax rate or how much they pay in taxes. Just pay attention people are moving to the states with NO INCOME TAX; Florida, Texas, Washington, Tennessee etc… and if you don’t think the reasoning is income tax I’d suggest you do more research.

@@rbtheballer I agree with you and I do not like taxes of any kind and taxation is theft. But if I had to choose property tax is much much much worse than income tax, With income tax, you have control over your income amount (I mean you do not have to get a much higher paying job) and it is auto deducted from paycheck and you can stash that money away that was not withheld from paycheck into a savings account earning almost nothing and its yours forever. With property tax, you have a home, but how can you really own it like your remaining money in the savings account, your TV, laptop, furniture, lawn mower and such. Itys a perpetual never ending payment or if you do not pay you lose your home. I hate income taxes too, but I hate property tax much much more. As a compromise in todays environment no way could income tax be eliminated while not making property tax higher. By eliminating property tax, more income has to come from somewhere top fund police and fire services, so may have to raise income tax a little. Unless we want to go back to the days where we really had no government or order. Not only is property tax a never ending payment on something you own but never really can own free and clear as long as it exists, it is based on value of your home which fluctuates and generally goes mostly one way up up and up faster than inflation which means much higher never ending payment. Income you get to keep some you can save and you can control how much income you make unlike the value of your house or other houses around that just go up up and up with no increase in square footage or land size. Yes there are caps on property taxes with Prop A in Michigan, but that goes bye bye once you move within the state and today's rates with todays prices the rate you will pay on property tax is extremely bad. Even old rates are a bit much. Someone should have the right to move and pay the same tax rate as the long time prior owner did not some artificially high rate based on stupid increased home value which single home owners and upgraders as well as down sizers have no control over. Yes income tax is bad too, but property tax is a heck of a lot worse.

@@Wolverine607 Income tax is a tax on you sweat equity and labor the government takes its cut before you even touch your earnings. The how are we going to fund police/fire is a classic npc argument, departments should be funded at the local level through a sales tax. The federal government needs to drastically be shrunk down it’s too big and bloated. The government right now is not paying its debts with your tax dollars it’s borrowing money to fund its expenses thus raising the federal deficit and passing the hidden tax of inflation on to its citizens. Your tax dollars go to other countries and entities that do nothing for this country.

What are your thoughts on going that route?

From a city to another city Within Michigan? It’s crazy for sure

@@LivingInMichigan Its because property values have skyrocketed. But if you stay in your home for years it is capped because of Proposal A. But that is eliminated once you move and reset. I will never move because of it. The lock in affect is nice for my 2013 bought home paid for in cash as my primary and forever home. I did not intend to move either way but this just cements it further. Unless property prices collapse again (2008-2009 like) and do not increase, this will be the case in the current system.

Yeah it sucks. Only way to move and not have a massive property tax spike in Michigan is if the law changes or if we have another 2008-2009 mega style crash or worse in prices again. Did you move yet and sell your home. If you have not sold your home yet, you can still stay capped. If you have sold and are looking its too late and will have to buy a new home at the insane uncapped tax value SEV the following year and are done despite getting much more for your home to pay for the more expensive new home. The lock in affect for taxes is gone then and too late. Really would be nice if Michigan would allow what California allows with Prop 13 for 55 and older to transfer their Prop 13 assessment to another home. Though make it for anyone not just 55 and older and allow at least one time move within the state keeping your following year purchased SEV as lock in and transfer that to new home meaning you use the new home you bought February assessment SEV that you had on home you just sold. M sister and laws parents want to move to be closer to her and my brother's family instead of 30 mile drive for babysitting my nephews but do not want to move due to uncapping and much higher taxes as they have been in their home built brand new since 1998. And my goodness $5K in property taxes especially for a modest hoe is already too high. Let alone $10K ouch. That is very bad. Approaching New Jersey level property taxes. What squared footage is your current home and what is the home size you are looking to move to where taxes would double due to uncapping? I am already slightly above $3900 for only 1700 square feet ranch no basement purchased 2013 and the uncapped assessment from Feb 2014 as assessments started to increase modestly during the early stage of price rebound. Inflation has really caused them to increase last few years when I was only at $3300. Could have only been at $2900 if prices did not start rebounding so soon and fast. But if I ever moved yikes.

Michigan has a similar thing called Proposal A passed in 1994. 5% or inflation whatever is less is how much you can be taxed on. But once you sell home it resets to uncapped value. I think its the same or similar in California with Prop 13. Though California its limited to 2% and 55 and older can transfer Prop 13 when moving to similar or less expensive home. In Michigan you cannot. California also has so much higher home prices than Michigan and almost every one else as well but they have a lower tax rate so there are even bigger differences between current recent home buyers and long time home owners especially 30+ year ones than the already big difference in Michigan.

So what if those taxes go up a little. At least they can't seize your home!

That would be fine and the government would probably end up with more revenue but at least people would not be at risk of losing their homes over taxes when you purchase items as in paid off in full such as food, toys,tools, ect... You don't continue to pay for it year after year you bought it you own it real-estate should be no different it is nothing less then theft and corruption from government to take some ones property over taxes and a Generational wealth killer...

@@michaelhancock9636 I agree. Lets have our home be like the computer, blender or furniture we own and not the kind of not truly owning it because a never ending yearly fee or it can be taken in a few years for non- tax payment which means you kind of really do not own it even if you pay off mortgage or do outright full 100% cash purchase.

Thank you, I appreciate the kind words!

Why did you need social services? Why did you need to have the government coddle you?

What’s your thought process for doing so?

@@LivingInMichigan hey, I'm an old guy, own my property,but am really struggling now. I live very rural, and in 15 years all I've got from my tax investment is the road graded occasionally,and maybe snow plowed. All things I could do better and cheaper than my 3000$ BURDEN