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Kevin Crampton Midland's Real Estate Educator

Michigan property tax uncapping estimator

In Michigan, a home's property taxes can jump the year after it sells. This estimates how much, so there are no surprises after closing.

From the seller's most recent tax bill or the assessor's record. This is usually lower than the home's market value.

About half the home's market value. If you only know the market value, enter half of it.

How the seller's bill is taxed today.

After you buy.

Primary-residence rate.

Typically about 18 mills higher.

1 mill = $1 of tax per $1,000 of taxable value. Verify current rates with the local assessor.

Enter the taxable value and SEV above to see the estimate and the math.

Why property taxes jump after a sale

Under Michigan's Proposal A, every home has two values: its state equalized value (SEV), which tracks roughly half of market value, and its taxable value, which is what your tax bill is actually based on.

While someone owns a home, the taxable value can only rise a little each year — the lesser of inflation or 5%. Over time, that cap holds the taxable value well below the SEV, so a long-time owner often pays taxes on a number much lower than what the home is worth.

When the home sells, that cap comes off. The year after the sale, the taxable value uncaps and resets up to the SEV. The new owner pays taxes on the higher number — which is why the bill can jump even though nothing about the house changed.

Assumptions in this estimate

  • The taxable value uncaps to the current SEV in the year after the transfer (Michigan Proposal A, MCL 211.27a).
  • The millage rates you entered stay the same before and after the sale. Real rates change over time and by jurisdiction, so verify them with the assessor.
  • Homestead status is modeled. A primary residence with the Principal Residence Exemption is taxed at a lower millage; a non-homestead property (second home or rental) pays roughly 18 more mills of school operating tax. The tool applies whichever rate matches the status you select for now and for after the purchase.
  • Special assessments, exemptions, and any future inflationary cap adjustments are not included.

This is an educational estimate, not tax advice. Actual taxes depend on your specific property, exemptions, and the rates set by your local taxing authorities. Always confirm the numbers with the local assessor before relying on them.

Questions about a specific property?

Kevin can help you understand the tax picture before you buy or sell.

Ask Kevin