Homestead Property Tax for Seniors and Disabled (Circuit Breaker)

State

Michigan

Year

2017

Variations in Receipt of Benefit

Benefit Varies with Income

Minimum Tax Amount Must be Paid

Benefit Type

Circuit Breaker

Benefit

Tax credits for those with resources less than $3,000 there is no minimum payment required. The percent of taxes to be paid increases 1% for each $1,000 increase in resources up to $6,000. For those with resources above $6,000, the credit is based on taxes that exceed 3.5% of resources. The tax credit for eligible applicants with household resources not over $21,000 is 100%. The percent of credit is reduced by 4% for each $1,000 above $21,000. For those with household resources above $30,000, the credit is 60% of the taxes that exceed 3.5% of resources. The credit is reduced by 10% for each $1,000 above $41,000 until total household resources reach $50,000. The maximum credit is $1,200. The claimant can claim this and the Homestead Credit up to the maximum of $1,200. Property taxes are assumed to be 20% of rent.

How is Benefit Disbursed

Credit to the income tax bill

Eligible Property Type

Residential

Characteristics of Eligible Property

Only residential properties are eligible for this program. Each claimant can only have one homestead which they must occupy.

Eligibility Criteria

Age

Disability

Homeowner

Income Ceiling

Principal Residence

Renter

Description of Eligibility Criteria

Homeowners and renters who are senior citizens age 65 and older, paraplegic, hemiplegic, quadriplegic, totally and permanently disabled, deaf, or blind are eligible. Totally and permanently disabled persons are defined as such by the United States Social Security Administration. Applicant's household resources cannot exceed $50,000. Credit is calculated based on homestead value of $2,500 or less. If taxable value is greater than $2,500, the credit is based on the percentage of taxable value is to $2,500.

Local Option in Adoption of Program

Local government is unable to exercise an option

Local Option Regarding Program Features

No local option regarding program features

State Funding for Local Tax Loss

State reimburses all of the local government tax loss

Description of State Funding for Tax Loss

The state provides the benefit directly to the taxpayer.

Record ID

MI106_RR17

Footnotes

Effective 2021 the taxable value cap will be adjusted by the percentage increase in the U.S. CPI for the immediately preceding calendar year and rounded to the next $100.00 increment. Effective 2018 for those who rent or lease can claim a credit based on 20% of gross rent paid for tax years before the 2018 tax year or 23% of the gross rent paid for tax years after the 2017 tax year. Effective 2018 the credit shall be reduced by 10% for each claimant whose total household resources exceed $51,000 and by an additional 10% for each increment of $1,000.00 of total household resources in excess of $51,000. Effective 2018 the maximum benefit is $1,500.00 Effective 2018 the credit is equal to 60% of the amount by which the property taxes exceeds 3.2% of the claimant’s household resources. Changes in accordance with 2015 Mi. Laws Ch. 179 § 522

Sources

Mich. Comp. Laws § 206.520; Mich. Comp. Laws § 206.522 (in effect for 2017)
Michigan Legislature, Michigan Taxpayer's Guide (Jan 2017)
[https://www.legislature.mi.gov/Publications/TaxpayerGuide-2017.pdf Accessed on 12/11/2018]
View Archived Source

Michigan Department of Treasury, Checklist for Determining Total Household Resources (2017)
[https://www.michigan.gov/documents/taxes/ChecklistDetermineTHR_444822_7.pdf accessed 06/29/2018]
View Archived Source

Michigan Department of Treasury, Checklist for Preparing a Homestead Property Tax Credit (MI-1040CR), (2017)
[https://www.michigan.gov/documents/taxes/MI-1040CR-Checklist_405711_7.pdf accessed 06/29/2018]
View Archived Source

Michigan Department of Treasury, 2017 Michigan Homestead Property Tax Credit Claim MI-1040CR, (2017)
[https://www.michigan.gov/documents/taxes/MI-1040CR_608966_7.pdf accessed 06/29/2018]
View Archived Source

Michigan Department of Treasury, 2017 Michigan Homestead Property Tax Credit Claim MI-1040CR-2, (2017)

[https://www.michigan.gov/documents/taxes/MI-1040CR-2_608985_7.pdf accessed 06/29/2018]

[https://www.lincolninst.edu/sites/default/files/gwipp/upload/sources/Michigan/2017/MI_Michigan_Homestead_Property_Tax_Credit_Claim_MI-1040CR-2_Michigan_Dept_of_Treasury_2017.pdf]

Michigan Legislature, Michigan Taxpayer's Guide (2017, see page 10)

[http://www.legislature.mi.gov/publications/TaxpayerGuide-2017.pdf Accessed on 04/23/2018]

[https://www.lincolninst.edu/sites/default/files/gwipp/upload/sources/Michigan/2017/MI_Taxpayers_Guide_2017_Michigan_Legislature_Feb_2017.pdf]


2015 Mi. Laws Ch. 179 § 522

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