Millage Rates in Michigan

Here is more on millage rates in Michigan.
The first year you are taxed on the SEV value and then from then on you are taxed on the taxable value. Taxable value can rise up to 5% or inflation which ever is less. But remember inflation on the house can be negative so sometimes taxable value and SEV can go down.

In a market where property values are rising SEV becomes less and less important to you after the first year because the taxable value should be less than the SEV. Usually when you are buying a house you will notice that if somebody has lived in the house a long time the taxable value is much lower than the SEV. That is because of Proposal A limits the increase in taxes per year. The estimated market value according to the state has risen faster than the taxable value. Proposal A saved us money!

However if values fall as they are now the assessor should lower the SEV. (they should but they don’t always do it because the city loses tax revenues). Let’s say you bought it for $300,000 in 2005, then the SEV is $150,000 in 2005. The assessor may say that the house is now worth 145,800 now so your taxes will go down in 2006. So let’s say you bought the home in 2005 at the peak of the housing market. Now two years later your house is worth less. It should reflect that in your SEV and taxable value. They both should have gone down.

The way you have to fight it is first get your facts. You need houses that have sold in the neighborhood and in the city that are comparable to yours. I.E. roughly same square footage, roughly same age, same style. They need to have sold for less than what your bought yours for and what your taxable value is. You need more than one house to support your claim. The more houses you have and the closer they are to your home the better chance you have of getting the assessor to agree with you and reduce your taxable value. Then you have to call the assessor’s office and find out the procedure to protest your taxes. Sometimes you can only do it once a year, sometimes you have to put it in writing, sometimes you have to go in front of a board.

It is worth the hassle! It will save you money for years to come when you get it corrected.
Want to figure out what your taxes are going to be? Here is the formula :

Value determined by assessor divided in half = SEV (State equalized value)

SEV X Millage rate = taxes

For example a you are buying a $400,000 house in Brighton. Let's say the SEV by coincidence corresponds to the purchase price. So the assessor estimated the house value at $400,000 too. So $400,000 X 50% = $200,000. So SEV is $200,000

$200,000 X .0361558 = $7,231.16 a year in taxes.

Two things to remember SEV can be less or more than the purchase price of the home or the offer that you are going to put in. But you are most likely going to pay based on the SEV unless you fight it with the tax board or assessor after you move in ( usually when you get your tax bill).

Remember this is only for homesteaded taxes. A homestead exemption, now known as a principal residence exemption may be used by a person who owns and occupies a home as their principal residence. If this is true, the person may claim an exemption from the 18 mills levied by local school districts for operating purposes. Again in English - Homesteaded taxes are a reduction in taxes based on that you use a home for your primary residence.

So Non-homesteaded taxes are on vacation homes, rental properties, and investment properties.

If you are not living there full time, you can not claim it. You cannot claim one house, and your wife, claim another. If you claim a homestead in another state you can not claim it here. If you try to cheat the state and they catch they can take away the homestead deduction on all your homes and make you pay back the taxes you should have been paying and penalty interest.

If you wish to search Michigan Homes or need more information on mortgages or real estate in Michigan go to my website http://www.russravary.com/
I hope this information on millage rates helped you. Russ Ravary