Assessing FAQs
What is a State Equalized Value?
State Equalized Value (SEV):
50% of Market Value or True Cash Value.
What is the formula for Capped Value?
Capped Value (CV):
The formula is: Previous year’s Taxable Value minus Losses (physical
changes to the property) times the Consumer Price Index (CPI) or 5%
whichever is less plus Additions (physical changes to the property),
(TV-Losses x CPI (5%) + Additions = CV)
What is Taxable Value?
Taxable Value (TV):
Lesser of State Equalized Value and Capped Value or the year
following a transfer of ownership (sale, gift, inheritance, etc) is
equal to the State Equalized Value. Taxes are based on Taxable
Value, not State Equalized Value.
How can my assessment go down and my taxes go up?
If your assessment (SEV) is larger than the taxable value the
assessment could be reduced and still not be less than the
calculated capped value. Example: SEV = 150,000 – Market reduction
5% = 142,500.
TV = 120,000 CPI = 3%
CV = 120,000 x 1.03 = 123,600
Therefore, the assessment would have decreased by $7,500 but the
capped value is still less so the taxable value would be equal to
the capped value resulting in an increase in tax dollars.
Why do I pay more taxes than my next door neighbor when our
houses are the same?
Proposal A, a constitutional amendment passed in March 1994,
provides for a Taxable Value (TV) and a State Equalized Value (SEV).
The TV on a home owned by the same owners for a longer period of
time tends to be lower than the SEV. Because of the provision in the
law that the TV is equal to the SEV the year following a transfer of
ownership, the values are closer even a few years later. Example:
House #1 & #2 both have SEV’s of $100,000 and TV’s of $80,000 for
2007. House #2 sells during 2007. So for 2008, house #1 has a SEV of
$105,000 and a TV of $84,000 assuming a 5% market increase and House
#2 has an SEV and TV the same, or $105,000 for 2008. House #2 is now
paying taxes on $105,000 instead of $84,000.
Why isn’t my new assessment 50% of my purchase price?
The simple answer is that it is against the law. MCL 211.27
states that the purchase price is no longer the presumptive True
Cash Value of a property. The assessment may be close to 50% of the
purchase price but it is determined by investigating the other sales
in the area of the property and all of the SEV are set using that
sales study.
When can I appeal my assessment?
By law, the only time you may appeal your assessment us at the
March Board of Review, which is held the second Monday, Tuesday, and
Wednesday in March. Read the Board
of Review notice by clicking here. After you receive the
Change of Assessment notice you may file a petition to make an
appointment.
What happens if I’m not happy with the decision of the March
Board of Review?
State law provides the next level of appeal at the Michigan Tax
Tribunal. A letter of appeal on residential property must be sent to
the Tribunal (P. O. Box 30232, Lansing, MI 48909) by July 31st
following an appearance at the March Board of Review.
Why can’t I protest my taxes when I get my tax bill in July?
The State law provides for one time per year to protest the value
of your property. That protest may be made at the March Board of
Review only. The protest may be made in person or by letter.
Is there any other tax relief for seniors besides deferment or
Poverty?
Besides deferment and poverty exemption, the only other tax
relief available is the Homestead Credit that is filed with your
income tax. You may receive up to $1,200 back from the State of
Michigan depending on your income and property tax amounts.
Can I divide my property and then build on it?
There is an application process to split any property and it
begins in the assessor’s office. Proposed parcels are reviewed for
compliance with the State and local ordinances. However, dividing a
property does not guarantee the buildability of the resulting
parcels. A consultation with Planning and Zoning would be necessary.
Do you have all of your information on line?
Almost all of the information in the Assessor’s Office is public
record. The amount paid in taxes is also public record and it is all
available online by
clicking here. Access the Assessor’s area and you may look up
information by name, address or parcel number. Square footage and
values are available and we expect to have the drawings of the
ground floor areas online in the near future.
How do I find out what has sold in my neighborhood?
The information is located on our counter in the Assessment
Department.
Where do I change my address?
You need to send a written request to the Assessing Department to
change the mailing address and that will change the address for both
assessments and taxes.
If I change my address with your department, does that change my
water billing address also?
No, you must contact the water department separately to change
that billing address.
How do I qualify for the homestead exemption?
The homestead exemption is more correctly known as the Principal
Residence Exemption (PRE). The qualifications are simple; you must
own and occupy the home as your principal residence on or before May
1. A person or a married couple is allowed only one PRE in the
State. You may not claim an exemption in any other state. The
exemption continues until the use of the home as your principal
residence changes. When the change occurs, you must notify the
assessor’s office in writing.
Why can’t I get a homestead for part of the year?
The legislature set the date of May 1 of the year as the date on
which you must own and occupy the home as your Principal Residence.
Proposal A and the enabling legislature does NOT allow for any
partial credit. Even if you move into a non-homestead property on
May 5, the exemption does not begin until the following year.
Sale prices are going down in my neighborhood, why hasn’t my
assessment gone down?
Sale prices going down in the neighborhood will not be reflected
immediately in your assessment. The State allows for a two year
sales study and an optional one year sales study. In inflationary
times, a two year study helps the taxpayer because sales used are
older and therefore lower in value. In deflationary times, a one
year sales study helps the taxpayer because it reflects the more
recent sales. The City of Novi has used one year sales studies for
2007 and 2008. For 2008 assessments, the State Tax Commission
allowed consideration of sales occurring between October 1, 2006 and
September 30, 2007. Likewise, sales occurring between October
1, 2007 and September 30, 2008 will be considered in setting 2009
assessments.
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