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Is my property assessment in Michigan legal if it's 35% below market value?

Is my property assessment in Michigan legal if it's 35% below market value?

Q: How close to market value is the assessed value?

In Michigan, the assessed value should be no more than 50% of the market value. However, actual assessed values can vary based on local assessments and market conditions. If your assessed value is significantly lower than the market value, it may warrant an appeal to ensure fair taxation.

Full question:

Regarding my property in the Michigan, the Board of Supervisors assessed my property at 35% less than my property is worth. Is this assessment legal or not?

Category: Taxes
Date: 04/07/2025
State: Michigan

Answer:

In Michigan, property taxes are based on Assessed Values, which should reflect no more than fifty percent of a property's Market Value. The Taxable Value is the lower of the Assessed Value or Capped Value. Proposal A, passed in 1994, limits increases in Taxable Value to five percent or the rate of inflation (Consumer Price Index), whichever is lower.

Assessments can increase or decrease as needed to maintain the fifty percent level of Market Value. However, since Taxable Value has been capped, it may not rise as quickly as the Assessed Value.

If you believe your assessment is incorrect, you can appeal it to the local Board of Review. To succeed in your appeal, your property must be valued at less than two times your Taxable Value to qualify for a reduction in taxes.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

How do I challenge my property tax assessment in Michigan?

To challenge your property tax assessment in Michigan, you must first contact your local Board of Review. You can file an appeal during the designated appeal period, usually in March. Prepare evidence to support your claim, such as recent sales data for similar properties. If your appeal is unsuccessful, you may further appeal to the Michigan Tax Tribunal. Make sure to adhere to all deadlines and procedures outlined by your local jurisdiction for a successful challenge.

How does assessed value compare to market value in Michigan?

In Michigan, assessed value should reflect no more than 50% of a property's market value. This means that if your property is assessed at a value significantly lower than its market value, it may indicate an error in the assessment. It's important to understand this relationship, as it affects your property taxes and potential appeals.

How does assessed value compare to market value?

Assessed value is typically calculated as a percentage of market value, often set at 50% in Michigan. Market value is the price a property would sell for in an open market, while assessed value is used for tax purposes. Discrepancies between the two can lead to appeals if the assessed value is significantly lower or higher than the market value.

Why is assessed value different than appraised value?

Assessed value is determined by local tax authorities for property tax purposes, usually set at a percentage of market value. Appraised value, on the other hand, is an estimate of a property's worth conducted by a licensed appraiser for various purposes, including sales or refinancing. These values can differ due to varying methods of calculation and the purpose of the valuation.

How close to market value is the assessed value?

How close is appraised value to market value?

Appraised value is generally intended to reflect market value, as it is based on comparable sales and current market conditions. However, appraisals can vary depending on the appraiser's methodology and the specific circumstances of the property. It's common for appraised values to align closely with market values, but discrepancies can occur.