Understanding Property Assessments and Taxes

Assessed Value (SEV), by order of law should represent 50% of your properties true cash value.  This can also be termed Market value.

Taxable Value (Tax), is the number that your taxes are calculated on.  It is last year’s Taxable, multiplied by the Consumers Price Index (CPI), also known as Rate of Inflation, or 5% whichever is less, unless there is a transfer of ownership.  The 2015 CPI is 1.6%.  Taxable value can increase or decrease when there has been alterations to the property.  New construction, addition or demolition all being examples of an alteration.

Principal Residence Exemption, (PRE) formerly known as Homestead exemption is the place you own and occupy as your permanent home and contiguous parcels that qualify.  You may only qualify for one PRE in Michigan.

Uncapping, is when a property transfers ownership, as defined by law.  If you purchased in 2014 the property will be uncapped for 2015, causing the taxable to become the same as the assessed.  Then in 2016 the taxable will only increase by the CPI or 5% whichever is less.

Exemptions, Poverty Exemptions can be accepted at the March Board of Review.  Veterans must file a 5107 STC affidavit annually with the Board of Review.  They must provide 2015 documentation from the US Department of Veterans Affairs to demonstrate eligibility.