HOUSE BILL No. 5846

 

February 18, 2010, Introduced by Reps. Stamas, Moss, Denby, Bolger, Lund, Daley, Rick Jones, McMillin, Moore, Walsh, Booher, Horn, Crawford and Caul and referred to the Committee on Tax Policy.

 

     A bill to amend 1893 PA 206, entitled

 

"The general property tax act,"

 

by amending section 7dd (MCL 211.7dd), as amended by 2008 PA 243.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 7dd. As used in sections 7cc and 7ee:

 

     (a) "Owner" means any of the following:

 

     (i) A person who owns property or who is purchasing property

 

under a land contract.

 

     (ii) A person who is a partial owner of property.

 

     (iii) A person who owns property as a result of being a

 

beneficiary of a will or trust or as a result of intestate

 

succession.

 

     (iv) A person who owns or is purchasing a dwelling on leased

 


land.

 

     (v) A person holding a life lease in property previously sold

 

or transferred to another.

 

     (vi) A grantor who has placed the property in a revocable trust

 

or a qualified personal residence trust.

 

     (vii) The sole present beneficiary of a trust if the trust

 

purchased or acquired the property as a principal residence for the

 

sole present beneficiary of the trust, and the sole present

 

beneficiary of the trust is totally and permanently disabled. As

 

used in this subparagraph, "totally and permanently disabled" means

 

disability as defined in section 216 of title II of the social

 

security act, 42 USC 416, without regard as to whether the sole

 

present beneficiary of the trust has reached the age of retirement.

 

     (viii) A cooperative housing corporation.

 

     (ix) A facility registered under the living care disclosure

 

act, 1976 PA 440, MCL 554.801 to 554.844.

 

     (x) A bank, credit union, or other lending institution that

 

owns property as a result of having foreclosed a mortgage on that

 

property for 3 years beginning on the December 31 of the year of

 

the foreclosure or until there is a transfer of ownership,

 

whichever occurs first.

 

     (xi) A land contract vendor that owns property as a result of

 

having foreclosed a land contract on that property for 3 years

 

beginning on the December 31 of the year of the foreclosure or

 

until there is a transfer of ownership, whichever occurs first.

 

     (b) "Person", for purposes of defining owner as used in

 

section 7cc, means an individual and for purposes of defining owner

 


as used in section 7ee means an individual, partnership,

 

corporation, limited liability company, association, or other legal

 

entity.

 

     (c) "Principal residence" means 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 established. Except as otherwise provided in this subdivision,

 

principal residence includes only that portion of a dwelling or

 

unit in a multiple-unit dwelling that is subject to ad valorem

 

taxes and that is owned and occupied by an owner of the dwelling or

 

unit. Principal residence also includes all of an owner's

 

unoccupied property classified as residential that is adjoining or

 

contiguous to the dwelling subject to ad valorem taxes and that is

 

owned and occupied by the owner. Contiguity is not broken by a

 

road, a right-of-way, or property purchased or taken under

 

condemnation proceedings by a public utility for power transmission

 

lines if the 2 parcels separated by the purchased or condemned

 

property were a single parcel prior to the sale or condemnation.

 

Except as otherwise provided in this subdivision, principal

 

residence also includes any portion of a dwelling or unit of an

 

owner that is rented or leased to another person as a residence as

 

long as that portion of the dwelling or unit that is rented or

 

leased is less than 50% of the total square footage of living space

 

in that dwelling or unit. Principal residence also includes a life

 

care facility registered under the living care disclosure act, 1976

 

PA 440, MCL 554.801 to 554.844. Principal residence also includes

 


property owned by a cooperative housing corporation and occupied by

 

tenant stockholders. Property owned by a bank, credit union, or

 

other lending institution or a land contract vendor as a result of

 

a mortgage foreclosure or land contract foreclosure shall continue

 

to qualify as a principal residence while held by that bank, credit

 

union, or other lending institution or that land contract vendor if

 

that property qualified as a principal residence prior to

 

foreclosure for 3 years beginning on the December 31 of the year of

 

foreclosure or until there is a transfer of ownership, whichever

 

occurs first. Property that qualified as a principal residence

 

shall continue to qualify as a principal residence for 3 years

 

after all or any portion of the dwelling or unit included in or

 

constituting the principal residence is rented or leased to another

 

person as a residence if all of the following conditions are

 

satisfied:

 

     (i) The owner of the dwelling or unit is absent while on active

 

duty in the armed forces of the United States.

 

     (ii) The dwelling or unit would otherwise qualify as the

 

owner's principal residence.

 

     (iii) Except as otherwise provided in this subparagraph, the

 

owner files an affidavit with the assessor of the local tax

 

collecting unit on or before May 1 attesting that it is his or her

 

intent to occupy the dwelling or unit as a principal residence upon

 

completion of active duty in the armed forces of the United States.

 

In 2008 only, the owner may file an affidavit under this

 

subparagraph on or before December 31. A copy of an affidavit filed

 

under this subparagraph shall be forwarded to the department of

 


treasury pursuant to a schedule prescribed by the department of

 

treasury.

 

     (d) "Qualified agricultural property" means unoccupied

 

property and related buildings classified as agricultural, or other

 

unoccupied property and related buildings located on that property

 

devoted primarily to agricultural use as defined in section 36101

 

of the natural resources and environmental protection act, 1994 PA

 

451, MCL 324.36101. Related buildings include a residence occupied

 

by a person employed in or actively involved in the agricultural

 

use and who has not claimed a principal residence exemption on

 

other property. Property used for commercial storage, commercial

 

processing, commercial distribution, commercial marketing, or

 

commercial shipping operations or other commercial or industrial

 

purposes is not qualified agricultural property. A parcel of

 

property is devoted primarily to agricultural use only if more than

 

50% of the parcel's acreage is devoted to agricultural use. An

 

owner shall not receive an exemption for that portion of the total

 

state equalized valuation of the property that is used for a

 

commercial or industrial purpose or that is a residence that is not

 

a related building.