Yes, Michigan does have local taxes. If you own a home or rent one, you’re paying into local property taxes through your tax bill or your rent. If you live or work in one of 24 specific cities, you also owe a city income tax on top of the state’s flat rate. Counties, townships, and special authorities can add smaller charges for things like lodging stays and neighborhood improvements. What Michigan localities cannot do is levy their own sales tax, so the 6% you pay at the register is the same everywhere in the state.1Michigan Legislature. Michigan Constitution of 1963 Article IX Section 25
Property Taxes: The Big One
Every parcel of real and personal property in Michigan is taxable unless a specific exemption applies.2Michigan Legislature. MCL Section 211.1 Your bill is built from three numbers.
The assessed value is set at roughly 50% of your property’s true market value. County equalization departments adjust these figures across jurisdictions to keep them uniform, producing the State Equalized Value (SEV). But your tax is calculated on a different figure: the taxable value. Under Proposal A, approved by voters in 1994, your taxable value cannot rise more than 5% or the rate of inflation year to year, whichever is lower. When the property sells, the cap resets and the new owner’s taxable value jumps to the current SEV. Two identical houses on the same block can carry very different bills if one has been in the same hands for decades.
The tax itself is applied as a millage rate. One mill equals $1 in tax per $1,000 of taxable value. A home with $80,000 in taxable value in an area with 40 combined mills owes $3,200 a year. Multiple entities stack their millages: county, city or township, school district, community college, and any special authorities such as libraries or transit.
When Your Bill Is Due
Property taxes are billed twice a year. Summer taxes become a lien on July 1 and are due by September 14. Winter taxes become a lien on December 1 and are due by February 14. A handful of cities set different dates by charter, so confirm yours with the local treasurer.3State of Michigan. Frequently Asked Questions – Property Tax State Education Tax
Late summer taxes accrue a 1% administrative fee plus 1% interest per month. A payment made in November already owes 104% of the original bill. If any balance is still unpaid by the last day of February, the entire amount goes delinquent and moves to the county treasurer.3State of Michigan. Frequently Asked Questions – Property Tax State Education Tax The county then adds a 4% administration fee and 1% interest per month going forward.4Michigan Legislature. MCL Section 211.78a – Property Returned as Delinquent Properties that stay delinquent eventually face forfeiture and foreclosure.
How to Lower Your Property Tax Bill
Michigan offers several programs that can meaningfully cut what you owe. Missing the filing deadlines is one of the most common and costly mistakes homeowners make.
Principal Residence Exemption
The Principal Residence Exemption (PRE) is the most widely used break in the state. It exempts your home from the local school district’s operating millage, typically saving several hundred dollars a year. You must own and occupy the property as your principal residence and file an affidavit with your local tax collecting unit by June 1 for the summer levy or November 1 for the winter levy.5Michigan Legislature. MCL Section 211.7cc – Principal Residence Exemption Once granted, it stays in place as long as you own and live in the home. If you recently bought and haven’t filed, you’re almost certainly overpaying.
Homestead Property Tax Credit
Separate from the PRE, the Homestead Property Tax Credit is claimed on your state income tax return (Form MI-1040CR) and reimburses part of what you paid in property tax. Both homeowners and renters can qualify. Total household resources must be $71,500 or less, and for homeowners, the property’s taxable value cannot exceed $165,400.6State of Michigan. Michigan Taxpayers Encouraged to Check Eligibility for Homestead Property Tax Credit The maximum credit is $1,900, available in full to households with total resources of $62,500 or less, then phasing out by 10% for each $1,000 above that.7State of Michigan. 2025 MI-1040CR-2 Homestead Property Tax Credit Claim Renters use 23% of annual rent, treated as property tax paid on their behalf. The average credit during the 2025 filing season was $820.
Disabled Veterans Exemption
Michigan fully exempts the homestead of a qualifying disabled veteran. The veteran must be a Michigan resident rated permanently and totally disabled by the U.S. Department of Veterans Affairs at 100%, have received assistance for specially adapted housing, or have been rated individually unemployable. A surviving spouse who does not remarry can continue the exemption. Applications go to the local assessor between January 1 and December 31 of the claim year and, once granted, do not require annual reapplication.8Michigan Legislature. House Bill No. 4444 – Disabled Veterans Property Tax Exemption
Poverty Exemption
Homeowners who cannot afford their property tax due to poverty can apply for a partial or complete exemption. The local supervisor and board of review decide, using income and asset guidelines set by each municipality, generally tied to multiples of the federal poverty level.9Michigan Legislature. MCL Section 211.7u – Poverty Exemption Contact your local assessor for the current thresholds and forms. The exemption does not apply to property owned by a corporation.
Appealing Your Assessment
If you think your assessed value is too high, start with the March Board of Review, which every city and township convenes each year. Hearings begin the second Monday in March, and the board must offer at least 12 hours of hearings during that week, with at least 3 hours after 6 p.m.10Michigan Legislature. MCL Section 211.30 – Board of Review Meetings You can appear in person, send an agent, or, if you’re a nonresident taxpayer, submit a written protest. Bring evidence: recent comparable sales, photographs of defects, or a professional appraisal. The board must finish its work by the first Monday in April.11Michigan Department of Treasury. 2026 Boards of Review – Bulletin 16 of 2025 If it denies your appeal, the next step is the Michigan Tax Tribunal.
City Income Taxes: 24 Cities
Twenty-four Michigan cities levy a local income tax on top of the state’s flat rate. If you live or work in one of them, you owe an additional tax on wages, business income, and certain other earnings.12State of Michigan. Which Cities Impose an Income Tax
Most of the 24 cities charge the standard maximum: 1% for residents and 0.5% for nonresidents who work there. Three charge more:
- Detroit: 2.4% resident, 1.2% nonresident13State of Michigan. 2026 City of Detroit Income Tax Withholding Guide
- Grand Rapids: 1.5% resident, 0.75% nonresident
- Highland Park: 2% resident, 1% nonresident14City of Grand Rapids. Other Michigan Cities with Income Tax
The other 21 use the standard 1%/0.5% split: Albion, Battle Creek, Benton Harbor, Big Rapids, East Lansing, Flint, Grayling, Hamtramck, Hudson, Ionia, Jackson, Lansing, Lapeer, Muskegon, Muskegon Heights, Pontiac, Port Huron, Portland, Saginaw, Springfield, and Walker.14City of Grand Rapids. Other Michigan Cities with Income Tax Detroit’s higher ceiling is authorized because state law lets cities over 750,000 exceed the standard cap.15Michigan Legislature. Michigan Compiled Laws 141-503 – Excise Tax on Income, Levy
Living in one of these cities means the resident rate applies to all your income, no matter where you earn it. Commuting into one means your employer should withhold the nonresident rate. Either way, you need to file a city return. The city filing deadline is April 30 of the following year, not the federal April 15.
Smaller Local Charges You May See
Beyond property and city income taxes, a few other charges can show up on local bills. Special assessments are tied to a specific improvement that directly benefits your parcel, such as a new sidewalk, sewer line, or paving job. They aren’t based on taxable value; they reflect the benefit the project confers on your property, and the total can be spread over up to 20 annual installments.16Michigan Legislature. MCL Section 125.985 – Principal Shopping Districts and Business Improvement Districts They appear on your tax bill and can surprise homeowners who missed the public hearings when the project was approved.
Counties can levy an excise tax on hotel and motel stays of fewer than 30 consecutive days under Public Act 263 of 1974. Rates vary by county, and some have legislative authorization to go above the original statutory level. The revenue funds convention and tourism promotion rather than general operations.
Local governments also charge fees for services like water, sewer, and trash collection. These aren’t technically taxes, since they’re tied to a service you receive, but they add up.
What Michigan Localities Cannot Tax
Michigan places real limits on local taxing power, which is why some taxes you’d see elsewhere don’t exist here.
No city or county in Michigan can impose its own sales tax. The state’s 6% is the only rate you’ll pay at the register anywhere in Michigan. A share of that state revenue is distributed back to local governments, but nothing can be layered on top.1Michigan Legislature. Michigan Constitution of 1963 Article IX Section 25 That is a meaningful contrast with states like Colorado or Louisiana, where combined rates can push past 10%.
The Headlee Amendment (Article IX, Section 31) prevents property tax revenue in a jurisdiction from growing faster than inflation through assessment increases alone. When total taxable value rises faster than inflation, the millage rate must be rolled back proportionally. That “Headlee rollback” is why authorized millage rates often decline gradually as property values climb, and why “Headlee override” proposals appear on local ballots when a government wants to restore the original rate.
The Michigan Constitution also requires voter approval before local taxes can be raised above existing limits.1Michigan Legislature. Michigan Constitution of 1963 Article IX Section 25 New millages, renewals at higher rates, and Headlee overrides all go on the ballot rather than being imposed by council or board vote alone.
Confirming Your Own Numbers
Millage rates, special assessments, and city income tax obligations differ enough across Michigan that the reliable move is to contact your local treasurer directly. Most cities, townships, and counties publish current millage rates, assessment information, and payment options online. For city income tax questions, the Michigan Department of Treasury maintains a list of all 24 cities and links to their forms.12State of Michigan. Which Cities Impose an Income Tax For the Homestead Credit, file Form MI-1040CR with your state return and keep records of property taxes or rent paid during the year.