Property Tax Assessment Questions & Answers
The Oakland County Board of Commissioners approved two consecutive millage reductions, giving Oakland County residents the lowest general operating tax of any county in the state of Michigan.
Proposal A, passed by the voters in 1994, has impacted the assessment process by placing a cap on some property assessments. Each year, when property owners in Oakland County receive their Property Assessment Notice, certain questions arise about how these changes impact their property taxes. This information will answer the most frequently asked questions.
What do the values on my Property Assessment Notice mean?
The Assessed Value is still calculated as it always has been. The Assessed Value cannot exceed 50 percent of True Cash Value or Market Value. For residential properties a two-year sales study is used to determine value.
The State Equalized Value is the Assessed Value after it has gone through both the County and State equalization process. On the notice that the taxpayer receives, it is a tentative figure until May of 2000.
The Capped Value is calculated by using the prior year's Taxable Value and adjusting it by 5 percent, or the Consumer Price Index (1.9% for 2000), whichever is less. If there were physical additions or losses to the property, such as a new garage or a porch is removed, the Capped Value would be adjusted.
The Taxable Value is simply the lower of the tentative State Equalized Value or the Capped Value.
If I purchase a home how does this change my taxes?
If a taxpayer purchases a home in 1999, the Taxable Value will be uncapped on the year 2000 assessment roll. When an uncapping takes place the Taxable Value becomes equal to the State Equalized Value. Assessors must verify that the ownership transfer of the property qualifies under the law. For example: If the transfer of the property is between a husband and wife, this dos not qualify as an ownership transfer. In the year 2001, the capping process would begin on the new Taxable Value.
To avoid the improper uncapping of a property, the purchaser should file the necessary Property Transfer Affidavit with the local assessor's office within 45 days of the transfer.
If I add a new garage to my property how does that affect my taxes?
New construction on a property is considered an addition to both the Assessed Value and the Capped Value, which would result in a change in Taxable Value. The cost of the improvement does not always equal the value. It is important to note that the original Taxable Value remains capped. Only the amount of the actual addition increases the Taxable Value above 1.9% for the year 2000. The new Taxable Value would then be capped in the future years.
If a homeowner simply repairs or maintains their home, such as having the roof replaced, their Taxable Value should not be affected.
If there is a question as to whether the new construction is calculated correctly or the repairs are added incorrectly, the taxpayer should contact the local assessor.
How do I qualify for a Homestead Exemption?
For a taxpayer to qualify for the Homestead Exemption they must own and occupy the property by May 1 of the year being requested. This exemption relieves a taxpayer from paying some school taxes.
The local March Board of Review does not have any authority to review Homestead Exemptions. Taxpayers should review their records to make sure the exemption has been accurately applied. The percentage of Homestead Exemption is listed on assessment notices.
How do I appeal the value of my home?
A taxpayer may appeal the value of their home to the local March Board of Review. This Board is appointed by each city or township and is comprised of citizens residing in your community.
If you are dissatisfied with the decision of the local March Board of Review, you may appeal their decision to the Michigan Tax Tribunal by June 30, 2000.
Where to file the proper documentation?
The above questions are just a few of the many questions asked each year by taxpayers from Oakland County. The local assessor's office is a primary source for filing documents or answering related questions. Another source of information is the Oakland County Equalization Division, which can be reached at 248-858-0740.