Property Assessor Panel
February 2025 Industry Update
Instructors: Beth Botke (Bath Charter Township) Heather Bouck (City of Mt. Pleasant) Jennifer Czeiszperger (City of Lansing) Heather Hoffman (Contract Assessor) Ashley Winstead (Meridian Township)
1. Understanding the Assessing Process:
- Property assessments follow a three-tier process:
- Local assessment
- County equalization
- State equalization
The final value, known as the State Equalized Value (SEV), ensures fair taxation at 50% of market value.
2. Key Property Value Terms:
- Assessed Value: Value set by the local assessor.
- State Equalized Value (SEV): Verified assessed value used for taxation.
- Taxable Value: Value used to calculate taxes, capped by inflation unless a transfer of ownership occurs.
- Uncapping: Taxable value resets to SEV after property transfers, often causing significant tax increases.
3. Transfer of Ownership & Uncapping Rules:
- Uncapping occurs after most property transfers, including inheritance or court orders.
- Exceptions exist for transfers between spouses or qualifying family members (parents, children, and now in-laws).
- Failing to file a property transfer affidavit within 45 days can result in a fine of up to $44,000, particularly for house flippers.
4. Tax Calculation Basics:
- Taxes = Taxable Value × Millage Rate
- Millage rates fund various public services (schools, police, fire departments).
- Principal Residence Exemption (PRE) reduces millage rates for owner-occupied properties.
5. Principal Residence Exemption (PRE):
- Homeowners can apply for a PRE to reduce school operating taxes.
- Conditional rescission allows homeowners selling their primary residence to maintain the PRE for up to three years if certain conditions are met.
6. Veterans and Disability Exemptions:
- 100% disabled veterans and their un-remarried surviving spouses can receive a full property tax exemption.
- Recent legislation allows surviving spouses to retain exemptions after relocating.
7. Board of Review Process:
Property owners can challenge assessments at the March Board of Review. Evidence (e.g., comparable sales or appraisals) is necessary to support an appeal.
8. Use of Sales Studies in Valuation:
Assessors use two-year sales studies to stabilize property value trends and prevent overreactions to short-term market fluctuations.
9. Common Mistakes and Tips for REALTORS®:
- Always advise clients of potential tax increases after uncapping.
- Use the Michigan Property Tax Estimator for more accurate estimates.
- Remind buyers to file for the PRE promptly to avoid higher non-homestead tax rates.
10. Updates and Compliance:
- Continuous changes to property tax laws require staying informed.
- Assessors recommend direct communication for clarification on complex scenarios.
