Renters are often unaware that they may qualify for property tax breaks.There is a tax break some are eligible for.

     Property tax laws are created by the state of Michigan. So, even though the actual tax is levied locally state laws apply. In the case of rents, state income tax laws provide that seventeen percent of a tenant's rent is to be considered equal to property taxes...as long as the building the renter is living in, has property taxes levied on it.

     If that is the case, up to 60 percent of any increase due to lifting the tax caps, may translate into a refund check from the state of Michigan. Here is how it works:
First multiply your annual rent by 17%.

Example (assuming the monthly rent is $300: $300 rent per month times 12 months = $3600
$3600 times 17% = $3,600 x .17 = $612

Now the state law also says that no one should have to pay more than 3.5 percent of their "household income" in property taxes.

So, multipy your total annual income from all sources by 3.5 percent ("household income" means money from jobs, social security, government assistance payments and any other income)
Example: assume $12000 in wages and $4800 in government cash assistance. Total income for a year equals $16,800
Multiply $16,800 times 3.5% = $18,800 x .035 = $588

Once you've determined how much rent is equivalent to taxes and know what 3.5% of your household income is, you can calculate your refund from the state.

The refund is sixty percent (60%) of the difference between the 17 percent what you actually paid in rent, and the 3.5% "obligation" owed under the law.

This means you subtract the $588 (3.5% obligation) from the 17% of actual rent $612       $612 - $588 = $124
This $124 is the maximum refund. It is given to those qualifying as senior citizens. If you are an ordinary citizen or qualify for the refund from vision impairment of veteran status, you'll be entitled to sixty percent of the $124 or about $74.

     You get the refund by filing a Michigan 1040cr form. It is important to remember, you don't have to have earnings from a job to qualify. The law provides that anyone who rents and has an income from any source may qualify for this benefit. Thus, you could be a retiree not yet qualified for social security and receive a refund...or a college student with earnings so low he or she is exempt from income taxes. The once household income and property tax criteria are met, you need only file the appropriate credit form.

If you happen to be a senior citizen though, you may would get the whole $124 back.

WARNING: There are some unscrupulous landlords who may use the removal of the tax caps as an excuse to raise your rent excessively. You may check with the City Assessor's office to determine how much taxes will change on the property you rent. This is a public record and available to anyone. Remember that property information is available from the city of Saginaw on the internet. Please do not call the Assessor's Office unless the tax caps are removed and you cannot find the information on the internet. The staff is short handed and very busy at the end of the year.