by P.D. Lesko

In October 2024, Michigan had a foreclosure rate of one in every 3,918 housing units. The counties with the highest foreclosure activity were Wayne, Oakland, Macomb, Genesee, and Kent. In 2024, Washtenaw County’s Treasurer auctioned off a dozen foreclosed properties. In Ann Arbor, just one foreclosed property was auctioned. Nonetheless, property taxes can be a burden on those of modest means, including people who live on fixed incomes. MCL – Section 211.7u, Michigan’s General Property Tax Act 206 of 1893, Chapter 211 requires all Michigan municipalities to offer property tax poverty exemptions of 25, 50, 75 or 100 percent to qualified residents each year.

Due to the P.A. 253 of 2020 changes to MCL211.7u, municipalities must also evaluate poverty exemption applications to determine if the homeowner applicant whose household income is over the limit for a 100 percent poverty property tax exemption, would qualify for a partial exemption equal to a 25 percent, 50 percent or 75 percent reduction in property taxes.

These property tax poverty exemption programs only apply to homes which are 100 PRE (primary residences). The Washtenaw County website has the links to the property tax poverty exemption programs in every county municipality, as well as links to the property tax deferment programs. There are income limits. For an Ypsilanti Twp. household with two people, for example, to qualify for a 100 percent property tax exemption, the total combined household income must be $28,700 or less.

Ypsilanti Twp. residents who wish to apply for a property tax poverty exemption, may find the township’s property tax poverty exemption program application documents here. The application is four-pages and applicants must also provide a poverty exemption affidavit.

In 2023, the General Property Tax Act 206 of 1893 was amended by Public Act 191. The 2023 amendment permits Michigan residents who qualify for a property tax poverty exemption to apply for an exemption for the preceding year, as well, even if the resident missed the previous year’s application deadline. If any property tax poverty exemption refund is due from the preceding year, the municipality is not legally required to pay interest, but is required to refund the preceding year’s property taxes which were exempt as per the applicant’s qualifying income.

According to data from the U.S. Census Bureau, the poverty rate in Washtenaw County is 14.6 percent, overall. That’s higher than the poverty rate is Michigan (13.5 percent) and the U.S. (12.5 percent). Cities and townships throughout Washtenaw County have varying poverty rates.

Again, according to data collected by the U.S. Census Bureau, Ypsilanti (pop. 21,000) leads the way in Washtenaw County with the highest percentage of residents and children under the age of 18 living in poverty (25.8 percent).

In Ypsilanti Twp., 15 percent of 54,585 residents live in poverty. Slightly more than half (57.5 percent) of all residents live in owner-occupied housing. The majority of the residents of Ypsilanti Twp. are white (54.8 percent) and 30.4 percent of the residents are Black. The per capita income of Ypsilanti Twp. residents $35,438 and the average monthly mortgage payment is $1,600.

In Ypsilanti which, saw a 6.1 percent decline in population between 2020 and 2024 (from 20,655 residents to 19,393) is whiter (60 percent) and has a higher percentage of residents with Bachelor’s degrees (45.8 percent) than Ypsilanti Twp. (38.5 percent). However, in Ypsilanti 25.5 percent of all residents live in poverty. Only 33.3 percent of Ypsilanti residents live in owner-occupied housing units with a median monthly mortgage cost of $1,699.

Ann Arbor is whiter still (68.8 percent of the city’s 119,381 residents), and educated. Seventy-seven percent of residents hold Bachelor’s degrees. However, 23.5 percent of the city’s residents live in poverty (27,457 people). In Ann Arbor, a lower percentage of people live in owner-occupied housing (45.6 percent) than do in Ypsilanti Twp. (57.5 percent). The median monthly mortgage in Ann Arbor is a whopping $2,396 per month and the per capita income in 2024 in Ann Arbor was $54,604. This means that out of that $54,604 in pre-tax income, an individual would spend 44 percent of it paying a median mortgage payment.

Here are the rules of the property tax poverty exemption program as overseen by the Michigan Treasury. Local municipalities must adhere to these rules as must all applicants.

With respect to property tax deferment of summer and winter taxes, this state program extends the deadline to pay property taxes to the following April 30 with no additional fees or interest. An application must be filed with the city or township treasurer each year. You are eligible if you are:

• Totally and permanently disabled
• 62 years of age or older
• Paraplegic or quadriplegic
• Eligible service persons, veterans, or widows/widowers
• Blind