The Tax Relief Deadline of May 1st is Near For Homeowners With A Vacant Second Residence

Under the Michigan Property Tax Act, only an owner-occupied residence is exempt from local school operating taxes under what is known as the Principal Residence Homestead Exemption.  A person may only claim one Principal Residence Homestead Exemption.  Because of the current condition of real estate sales in Michigan, many homeowners who have moved to another residence for employment or other reasons may not have been able to sell their prior residence.

Governor Granholm has signed into law Public Act 96 of 2008 (PA 96), which is effective immediately, to provides tax relief for those persons unable to sell vacant homes.    In addition to an owner's current principal residence, that owner can retain a "Conditional Principal Residence Exemption" for up to three years on property previously exempt as the owner's residence. 

To qualify for the Conditional Principal Residence Exemption, the prior residence must:

(a) not be occupied or leased,

(b) be listed for sale, and

(c) not be used for any business or commercial purpose.

To receive a second homestead exemption for 2008, the owner must file a Conditional Rescission Of Principal Residence Exemption with their local assessor before May 1, 2008. 

You can access the Department of Treasury Form 4640 from their website.