May 1st deadline for Dual Principal Residence Exemptions in Michigan

In case you weren't aware, if you or a client have purchased another home in the State of Michigan,

and they are trying to sell their original residence, they may be able to claim homestead exemptions

on both properties for up to 3 years.  Please review the guidelines below and notify your sellers! 

I am taking my clients paperwork to the Grand Rapids Assessor personally this week to meet the

May 1 deadline.      It could save them thousands of dollars.

Principal Residence Exemption Forms Now Available- Must be Submitted to Assessors by May 1 

As a follow up to MAR's e-news alert last week regarding the Passage of Public Act 96 (see article) which

enables home sellers to retain two principal resident exemptions for property still on the market after

the seller has moved elsewhere in the state, the “Conditional Rescission of Principal Residence

Exemption Form #4640" form from the Department of Treasury is now available.  To qualify for the

conditional rescission in 2008, Form #4640 must be submitted to the assessor of the local unit of

government where the property is located on or before May 1, 2008.

Click Here to Download Form.

Public Act 96 enables a person who has established a new principal residence to retain a Principal

Residence Exemption (PRE) on property previously exempt as the owner’s principal residence that

is not occupied and for sale by submitting a Conditional Rescission of Principal Residence Exemption

Form #4640. The conditional rescission allows an owner to receive a PRE on his or her new property

and on previously exempted property simultaneously if certain criteria are met:

• the property is not occupied,

• the property is for sale

• the property is not leased

• the property is not used for any business or commercial purpose

*The opportunity to apply and qualify for a conditional rescission begins for the 2008 tax year and is not

retroactive to previous tax years.

Again, To qualify for the conditional rescission in 2008, Form #4640 must be submitted to the

assessor of the local unit of government where the property is located on or before May 1, 2008.

The Board of Review has no authority with regard to a conditional rescission and cannot institute a

conditional rescission on behalf of an owner if a deadline is missed or for previous tax years. An

owner must annually submit Form #4640 on or before December 31 to verify to the assessor that

the property for which the PRE is retained is not occupied, is for sale, is not leased, and is not used

for any business or commercial purpose.

The Department of Treasury is in the process of developing a Frequently Asked Question sheet to

address various issues related to the new conditional rescission. They hope to have those questions

posted on the web some time next week. Form #4640, which includes an instruction page, can also

be found at www.michigan.gov/taxes.

If you have any questions regarding conditional rescissions, please feel free to contact the PRE Unit

at (517) 373-1950 or email Patrick Huber, Manager of the Property Tax Exemption Section, at

huberp@michigan.gov.

  Copyright by Terry Westbrook 2008

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