Michigan Property Tax

Michigan is the one state on this site where the limitation on your taxes is removed by a legal event that has nothing to do with the property’s value: a transfer of ownership. Voters approved that design in Proposal A in March 1994, and it made taxable value — not state equalized value — the figure the tax is calculated on. Everything else about the system follows from those two facts, including the thing that surprises new owners: a rise that looks impossible, and then a second bill that rises again.

In this section

• Taxable value and the inflation-or-5% limit — the capped value formula, why the multiplier can never exceed 1.05, and why additions enter it at half their value.
• Uncapping on a transfer of ownership — why the taxable value becomes the state equalized value the year after a sale, and why a buyer’s first bill is not the one that moves.
• The notice of assessment — what arrives before the March boards, and the one line on it that decides whether the cap applies.
• The appeal route — the March Board of Review, the two Tribunal windows, and what the county says evidence has to show.
• Michigan property tax deadlines — Tax Day, the notice, the boards, both Tribunal dates and the principal residence affidavit.
• Michigan property value estimator — see how the 50% assessment works, when a transfer uncaps the taxable value, and estimate the tax at your own millage.

The four figures, in order

Michigan puts four numbers between the property and the tax, and the order matters because each one is built from the last:

1. Assessed value (AV) — determined by the local assessor as of December 31, and no more than 50% of true cash value.
2. State equalized value (SEV) — the assessed value after county and state equalization.
3. Capped value — last year’s taxable value, less losses, multiplied by an inflation rate multiplier that is never more than 1.05, plus additions.
4. Taxable value (TV) — the lesser of SEV or capped value, unless there was a transfer of ownership, in which case it becomes the SEV in the calendar year after the transfer.

The millage rate is applied to the fourth figure. A rise in market value therefore does not, by itself, move your bill: SEV can climb while taxable value stays under the cap and the tax does not follow it.

Worked example (illustrative)

Made-up round numbers, and an illustrative multiplier — not a valuation, not your property, and not a prediction. The multiplier for the current year is published by the State Tax Commission and this site does not reproduce it.

1. Start: last year’s taxable value is $200,000 and the state equalized value is $230,000. The property is taxed on $200,000.
2. The county applies the formula: with an illustrative inflation rate multiplier of 1.03 and no losses, the capped value is $200,000 × 1.03 = $206,000.
3. You build a garage. Its true cash value is $40,000, but additions enter the formula at assessed value — half of true cash value — so the capped value becomes $206,000 + $20,000 = $226,000.
4. Taxable value: the SEV is now $250,000, so the lesser of the two is $226,000. Your taxable value rose 13% in a year when the limit is 5% — lawfully, because the addition is a term of the formula rather than an exception to it.
5. Then you sell. The next calendar year’s taxable value becomes the state equalized value, $250,000, and the limitation begins again from there the year after. That is a 10.6% increase on the buyer’s roll with no improvement to the property at all.

What this tells you: a Michigan taxable value that moves by more than 5% is not evidence of an error. Additions, losses and transfers of ownership all produce increases the limitation is designed to permit, and the notice states whether a transfer occurred.

What it does not tell you: this year’s multiplier, the millage rate in your city or township, or whether the figures the county used are right — that last one is argued at the March Board of Review.

What this does not cover

Michigan’s statute site and the State Tax Commission’s guidance could not be read from this site, so two things are deliberately absent: the exact session requirement and dates of the March Board of Review, and the current year’s inflation rate multiplier. Both are published by your local unit and by the state, and the pages that touch them say so rather than filling the gap from a summary.