(If you just bought your home, you want to read this!)
In the year following the purchase of a property, the Taxable Value becomes equal to the Assessed Value. This is commonly referred to as “uncapping.” In the second year after a property is purchased, the Taxable Value is again capped, and may only increase by the Inflation Rate Multiplier (IRM) or 5%, whichever is less, provided there is no new construction or losses. In Michigan, taxes are based on Taxable Value. Taxable Value can never be greater than the Assessed Value.
When a property transfers ownership, the taxable value uncaps to the current assessed value. This is one (1) of the impacts of Proposal A of 1994 that the voters of Michigan passed. For an example:
2021 Taxable Value 105,000
2021 Assessed Value 150,000
Date of sale 07/01/2021
2022 Taxable Value 150,000
2022 Assessed Value 150,000
This is a STATE law and the local government or board of review have no authority to change this impact.
Link to bulletin 15 of 2021:
Link to bulletin 17 of 2021:
Unfortunately, Proposal A is typically no longer stressed to new buyers during the process of buying property in Michigan. The officials at the Township are not aware of a transfer until after it occurs and become responsible for educating the new buyer.