MI HB5257

Establishes a property tax exemption for principal residences of qualified taxpayers unable to contribute to public charges due to poverty, replacing prior discretionary language with mandatory exemption criteria.

Requires applicants to own and occupy the property as a principal residence, file applications with federal and state income tax returns, provide identification and proof of ownership, and meet federal poverty guidelines or alternative local income guidelines.

Permits exemptions for the current tax year and retroactively for up to 2 preceding tax years if the applicant would have been eligible; requires refund of previously paid taxes, interest, penalties, and fees within 30 days.

Allows local tax collecting units to establish asset level criteria for exemption, but excludes the principal residence value, items under $5,000, education savings accounts, and one automobile per household from asset calculations.

Defines grounds for denial including non-qualified taxpayer status, fraud, lack of property interest, undisclosed household income from non-occupant owners, substantially greater than average property value, and substantial and compelling reasons communicated in writing to applicants.