President's Message

Mark your calendars! The March property tax board of reviews are coming!! This is the only time of year we as property tax paying citizens have the right to protest what the assessor has valued our properties at and is charging taxes based on that value.

To give you a little background, we as citizens of the State of Michigan voted and approved proposal A in 1994, a tax initiative that capped all property values. This limited annual assessment increases for each property parcel to 5% or inflation rate, whichever is less. When property is sold or transferred, assessment adjust to current value.

On your tax assessments there are two values listed; one is taxable value, that is what you are being taxed on (and the one that is capped) and the other is the State Equalized Value (SEV) which there is no cap on. The SEV is irrelevant to the current property owner. It only becomes relevant when the property is sold. The Taxable value then becomes the SEV. When a property is sold both of these values become the same amount. The problems are if the SEV is $50,000, which would indicate a fair market value of $100,000. If the property is purchased for $75,000, the taxable/SEV values should be $37,500; but they are not, they are what the SEV value is $50,000. The local assessor has discretion on determining taxable value.

The process to appeal this starts at the local assessor for which municipality the property is located in. Call and find out what days/times the tax appeals are done and see if you need to make an appointment. The burden of proof is upon the property owner to prove the value assessed is too high. Shortly after you will receive a letter with their decision. If you are not happy with the decision you have the right to appeal with the Michigan State Tax Tribunal. This must be post marked by June 30^thof the same year.

In my early years I paid little attention to tax value and every year when I received my tax statement I would just file it away. Most of the time it did not make much of a difference due to the fact that property values were increasing so fast. That is not the case anymore so make sure you inspect them carefully.

Chris Yatooma, President

Real Estate Investors Association of Oakland

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