Michigan's "Homestead property tax credit"....what a farce.

[JDgreen227]

For the 35-odd years I have been paying property taxes, I wonder how many times I was told: "When you are older with a reduced income, you will get a break on your state taxes because Michigan has this Homestead property tax credit....."

Yeah, right. I finished calculating my state income taxes this morning, and I finally qualify for the property tax credit because of my reduced income. And for the calender year 2013, after being billed for property tax in the amount of $3300 I get a credit of $1200, which reduces my state income tax bill by the huge sum of $51.00. Know how much my property tax bill went up last year? $72.00!!!

Does your state offer a property tax credit in any form that reduces your state income tax, and is the credit actually enough to make it worth dealing with all the paperwork involved?

 

[murphy1244]

Ohio credit saves me about 550 bucks on property taxes.

 

[JDgreen227]

Ohio credit saves me about 550 bucks on property taxes.

Your credit reduces your property taxes? I appreciate that information, but I was asking about state income taxes being reduced because you pay property taxes. Thanks.

 

[murphy1244]

Your credit reduces your property taxes? I appreciate that information, but I was asking about state income taxes being reduced because you pay property taxes. Thanks.

Sorry.

 

[Ken]

Your credit reduces your property taxes? I appreciate that information, but I was asking about state income taxes being reduced because you pay property taxes. Thanks.

Way back when first retired qualified for the Home stead tax deduction of $300.00 and it could not be raised.
Then the property was re appraised. value was double of past years so new tax increase then minus the $300 only increased my taxes to a few hundred more than the past.
Laws written by lawyers always have loop holes for politicians to get passed restrictions.
And this is property taxes not the state tax.
This State group is like the feds. nothing is enough 2013 tax table income of $0 to$100 tax is $1.00

 

[Gunny]

I think when they were telling you that they meant you get a break on your state property taxes because using the word "Homestead" kinda leans it that way.

Here (Kentucky) once you reach 65, they drop $35000 off the taxable valuation of your primary residence and it's called a "Homestead Exemption"

 

[TnAndy]

Does your state offer a property tax credit in any form that reduces your state income tax, and is the credit actually enough to make it worth dealing with all the paperwork involved?

MY State doesn't have an income tax. Vote with your feet.

 

[JDgreen227]

I think when they were telling you that they meant you get a break on your state property taxes because using the word "Homestead" kinda leans it that way.

Here (Kentucky) once you reach 65, they drop $35000 off the taxable valuation of your primary residence and it's called a "Homestead Exemption"

What ticks me off seriously is that many citizens 65 and older nationwide have probably been paying property taxes for 40 years or more...yet do many of them get a break like you describe? NO. Doing that in Michigan would cut my yearly tax bill by about 40%. And I get so tired of having lawmakers tell me: "Of course, your property taxes can be written off as a deduction when you itemize your federal income tax...." What a fricking joke. NOBODY I know at age 65 can itemize deductions and come out ahead.

 

[dave1949]

This is Maine's current program (recently revised starting this year):

Homeowners or renters will be eligible who meet all of the following requirements:

Were Maine residents during any part of the tax year;
Owned or rented a home in Maine during any part of the tax year and lived in that home during the year;
Had Maine adjusted gross income of not more than $40,000; and
Paid property tax on a home in Maine during the tax year that was more than 10% of Maine adjusted gross income or paid rent to live in a home or apartment in Maine during the tax year that was more than 40% of Maine adjusted gross income.

How much is the refundable credit? Qualified Maine residents can get as much as $300 ($400 if 70 years of age or older).

Basically, if your Maine AGI is less than $40K, and your property tax exceeds 10% of your Maine AGI, you can get back up to $300 of that as an income tax credit.

 

[KTurner]

What ticks me off seriously is that many citizens 65 and older nationwide have probably been paying property taxes for 40 years or more...yet do many of them get a break like you describe? NO. Doing that in Michigan would cut my yearly tax bill by about 40%. And I get so tired of having lawmakers tell me: "Of course, your property taxes can be written off as a deduction when you itemize your federal income tax...." What a fricking joke. NOBODY I know at age 65 can itemize deductions and come out ahead.

My wife's family has been paying property taxes on this piece of land for TWO HUNDRED years, or however long there have been property taxes. I'm not sure if property taxes were in effect here when they bought the land in 1812. And that doesn't qualify us for any break on the property tax. Property tax is county level, at least here. While I understand the need for counties to raise revenue, I don't always agree with what they use it on. As far as assessment goes, either they tweak the assessment, or they tweak the tax rate, but they're going to get the number they want.

Our county does offer relief to people either permanently disabled or 65 or older, provided they fill out the paperwork each year, income of less than $50k, assets less than $200k (excluding residence and 10 acres of land) and they reside on the property on which the tax relief is being sought. The exemption varies based on income.

The state needs/wants X dollars per year. They are going to get it one way or another. States can't run a deficit or print money like the feds can, with maybe one exception (VT?). When they give you a tax break, that means either they are spending less or somebody else is paying more. Which do you think is the case? So it boils down to which special interest group is able to pay their lawyers/lobbyists more to get their tax break into law....

Keith