Michigan Principle Residence Exemption - What You Need to Know

In Michigan, one's principle residence is exempt from taxes levied by local school districts for school operating purposes. "Principle Residence" is defined by statute as "the 1 place where an owner of the property has his or her true, fixed, and permanent home to which, whenever absent, he or she intends to return and that shall continue as a principal residence until another principal residence is etablished."

Additional guidance is contained in the instructions for completing the Homeowner's Principle Residence Exemption Affidavit. Generally speaking, a married couple cannot claim two principle residences unless they actually live apart and maintain two separate residences. An owner can only claim a principle residence exemption if, as stated in the affidavit, the property being claimed is actually one's principal residence, which is described as "the place you intend to return whenever you go away. . . the address that appears on your driver's license or voter registration card. The Treasury Department's instructions also provide that ". . . you may have only one principal residence at a time. Vacation homes. . .which you do not occupy as your principal residence may not be claimed."

If it is determined that you improperly claimed a personal residence exemption, you may be subject to additional tax, interest and penalties. If you have any questions regarding your qualifications for the personal residence exemption, you should contact your local tax assessor or a qualified real estate attorney or tax professional.