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Michigan
You may be eligible to receive money back
Michigan Program Overview
Michigan offers the Homestead Property Tax Credit and the Home Heating Credit for both renters and homeowners. Michigan’s Homestead Property Tax Credit may help you get some of your property taxes back from the State of Michigan. Homestead refers to the place where you have your permanent home. The credit, for most people, is based on a comparison between property taxes and total household resources. Homeowners pay property taxes directly, while renters pay them indirectly with their rent. The maximum credit is $1,600.
Renters age 65+, whose rent is more than 40% of their total household resources, may qualify for an alternative credit. Homeowners may also be eligible for a Principal Resident Exception that exempts taxes levied by a local school district.
Homeowners
Homeowners may qualify for the Michigan Homestead Property Tax Credit (1040CR) and/or the Principal Residence Exemption, which makes a residence exempt from taxes levied by a local school district. If you own and occupy the property as your home, you should file a Principal Residence Exemption Affidavit (Form 2368) with your county, city, township or village and submit your summer and winter property tax statements to Michigan Department of Treasury for review.
Eligibility
To qualify for the Michigan Homestead Property Tax Credit (1040CR):
- Total household resources cannot be more than $63,000. If you are filing a part-year credit (for a deceased taxpayer or a part-year resident), you must annualize the total household resources to determine if the credit reduction applies. If 100% of your total household resources were received from the Michigan Department of Health and Human Services, you do not qualify.
- You own and occupied a Michigan homestead for at least 6 months during the year on which property taxes and/or service fees were levied.
- If you own your home, the taxable value was $143,000 or less (unless unoccupied farmland). Taxable value is found on your property tax statement sent to you by your county, city, township or village office. Do not use the State Equalized Value or Assessed Value.
- Your homestead can be a mobile home on a lot in a mobile home park.
- Cottages, second homes, property you own and rent/lease to others, and college dormitories do not qualify as a homestead.
Active Military, Veterans, Surviving Spouse of a Veteran or Blind Homeowners
- If you are in the active military, are an eligible veteran, or an eligible veteran's surviving spouse, complete form MI-1040CR-2. If you are blind and own a homestead, complete form MI-1040CR. Use the form that gives you a larger credit.
Deceased Claimant
- The estate of the taxpayer who died in 2022 or 2023 before filing a claim may be entitled to a credit for 2022.
- The surviving spouse, other authorized claimant or personal representative can claim this credit.
- The surviving spouse is considered married for the year in which the deceased spouse dies and may file a joint credit for that year.
Nursing Home, Foster Care Home, Home for the Aged
- Permanent occupants of a nursing home, foster care home, or home for the aged that is subject to property taxes may use the allocated share of the property taxes levied on the facility as taxes eligible for credit. Nursing home managers should have this information.
- Single occupants of a nursing home, foster care home, or home for the aged who maintain an unrented homestead may claim either their homestead tax or their share of the facility's property taxes. Both may not be claimed. Use the one that gives you the larger credit.
- Filers who maintain a homestead and their spouse lives in an adult care facility may file a joint credit claim by combining their spouse’s share of the facility's property tax and their homestead tax.
- Credit is not allowed if your care facility charges are paid directly to the facility by a government agency.
For the Principal Residence Exemption:
- A married couple, filing income tax returns jointly, are generally entitled to no more than one principal residence exemption.
Exceptions to the rule are:
- The law allows a temporary, additional exemption for up to three years on an unoccupied homestead listed for sale.
- Homeowners with a principal residence exemption currently residing in a nursing home, assisted living facility, or other location while convalescing and members of the armed services absent on active duty may maintain the exemption so long as they continue to own and maintain the property, they do not establish a new primary residence, and the property is not used for most commercial and business purposes.
- A homeowner who vacates their home because of damage or destruction may maintain the exemption for up to three years as long as they demonstrate an intent to move back in.
Application Deadline
If you are not required to file an MI-1040, you may file your credit claim as soon as you know your 2022 total household resources and property taxes levied in 2022. If you file a Michigan income tax return, your credit claim should be included with your MI-1040 return and filed by April 18, 2023 to be considered timely. To avoid penalty and interest, if you owe tax, postmark your return no later than April 18, 2023. The filing deadline to receive a 2022 property tax credit is April 18, 2027.
Required Documentation
When filing your tax return, include all taxable and nontaxable income you and your spouse received in 2022 that apply from the list below:
- W-2s and 1099s
- Business income from Federal Schedule C, C-EZ or E or F
- 1099-Rs from pensions
- 1099-INTs or 1099-DIVs
- Alimony if divorce was granted prior to 2019 and other taxable income
- Social Security, SSI and/or railroad retirement benefits and payment to minors or dependent adults who live with you
- Child support and foster parent payments
- Unemployment compensation
- Gifts received or expenses paid on your behalf over $300
- Workers'/veterans' disability compensation/pension benefits
- FIP and other MDHHS benefits, excluding food assistance
- Form AV-9A Certificate of Disability (if applicable)
Renters
In most cases, 23% of rent paid is considered property tax that can be claimed for credit through Michigan’s Homestead Property Tax Credit program.
Eligibility
To qualify:
- Total household resources cannot be more than $63,000. If you are filing a part-year credit (for a deceased taxpayer or a part-year resident), you must annualize the total household resources to determine if the credit reduction applies. If 100% of your total household resources were received from the Michigan Department of Health and Human Services, you do not qualify.
- You were contracted to pay rent and occupied a Michigan homestead for at least 6 months during the year on which property taxes and/or service fees were levied.
- Renters must be under a lease or rental contract to claim rent for credit.
- Your homestead can be a rented apartment on a lot in a mobile home park.
- Cottages, second homes, property you own and rent/lease to others, and college dormitories do not qualify as a homestead.
The following are exceptions:
- If you rent or lease housing subject to a service charge or fees paid instead of property taxes, you may claim a credit based upon 10% of the gross rent you paid.
- If your housing is exempt from property tax and no service fee is paid, you are not eligible for a credit.
- This includes university-or college-owned housing
- If your housing costs are subsidized, base your claim on the amount you pay.
- Do not include the federal subsidy amount.
- If you are a mobile home park resident, claim the $3 per month specific tax.
Renters aged 65+
- An alternative credit is available for those whose rent is more than 40% of their total household resources. A separate worksheet, Worksheet 4, in the MI-1040 booklet should be completed
Cooperative Housing Residents
- If you are a cooperative housing corporation resident member, claim your share of the property taxes on the building. If you live in a cooperative where residents pay rent on the land under the building, you may also claim 23% of the land rent. Do not take 23 percent of your total monthly payment.
- If you are a resident of a special housing facility, not noted previously, base your claim on rent only. Do not include other services.
- If you pay rent with other services and you are unable to determine the portion that constitutes rent only, you may determine your portion of the property taxes that can be claimed for credit based on square footage or divide the taxes by the number of residents for whom the house is licensed to care.
Active Military, Veterans, Surviving Spouse of a Veteran or Blind Renters
- If you are in the active military, are an eligible veteran, or an eligible veteran's surviving spouse, complete form MI-1040CR-2. If you are blind and rent a homestead, complete form MI-1040CR. Use the form that gives you a larger credit.
Nursing Home, Foster Care Home, Home for the Aged
- Permanent occupants of a nursing home, foster care home, or home for the aged that is subject to property taxes may use the allocated share of the property taxes levied on the facility as taxes eligible for credit. Nursing home managers should have this information.
- Single occupants of a nursing home, foster care home, or home for the aged who maintain an unrented homestead may claim either their homestead tax or their share of the facility's property taxes. Both may not be claimed. Use the one that gives you the larger credit.
- Filers who maintain a homestead and their spouse lives in an adult care facility may file a joint credit claim by combining their spouse’s share of the facility's property tax and their homestead tax.
- Credit is not allowed if your care facility charges are paid directly to the facility by a government agency.
Application Deadline
If you are not required to file an MI-1040, you may file your credit claim as soon as you know your 2022 total household resources and property taxes levied in 2022. If you file a Michigan income tax return, your credit claim should be included with your MI-1040 return and filed by April 18, 2023 to be considered timely. To avoid penalty and interest, if you owe tax, postmark your return no later than April 18, 2023. The filing deadline to receive a 2022 property tax credit is April 18, 2027.
Required Documentation
A copy of all signed leases
When filing your tax return, include all taxable and nontaxable income you and your spouse received in 2022 that apply from the list below:
- W-2s and 1099s
- Business income from Federal Schedule C, C-EZ or E or F
- 1099-Rs from pensions
- 1099-INTs or 1099-DIVs
- Alimony if divorce was granted prior to 2019 and other taxable income
- Social Security, SSI and/or railroad retirement benefits and payment to minors or dependent adults who live with you
- Child support and foster parent payments
- Unemployment compensation
- Gifts received or expenses paid on your behalf over $300
- Workers'/veterans' disability compensation/pension benefits
- FIP and other MDHHS benefits, excluding food assistance
Michigan Home Heating Credit (For Homeowners & Renters)
Michigan Home Heating Credit helps pay the heating expenses for eligible Michigan homeowners and renters with low income. Over the last 5 years, 257,500 Michigan residents received the Home Heating Credit, which averaged $209. For questions about eligibility, please visit the Home Heating Credit information page on the Michigan Department of Treasury website.
Eligibility
To qualify:
- Your homestead must be in Michigan
- You must own a home or have a lease agreement to pay rent where you live
- You cannot live in college- or university-operated housing (including dormitories, residence halls, or apartments)
- Your household resources must be within the income limits listed on the Home Heating Credit application.
Application Deadline
The final date for filing a 2022 home heating credit is September 30, 2023. (Your claim must be postmarked by September 30, 2023) The filing of an extension for income taxes does not extend the due date for the home heating credit. File early to receive priority processing.
Required Documentation
- Social Security numbers for all household members
- Total household resources, including all taxable and non-taxable income
- Name of your heat provider
- Heating bills between 11/1/2021 and 10/31/2022
- What taxpayer paid in medical insurance or HMO premiums
Contact Details
For questions about eligibility, please visit the Home Heating Credit information page on the Michigan Department of Treasury website.
Your Resources
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