What the exemption does
The Principal Residence Exemption (PRE) exempts your home from the local school district's operating tax, up to 18 mills. On many homes, that's a meaningful savings every year.
Who qualifies
You qualify if you own the home and live in it as your principal residence. Generally you can claim it on only one home, the one you actually live in.
How to file
- Get Form 2368, the Principal Residence Exemption Affidavit, from the Michigan Department of Treasury website or your assessor. It's often included in your closing paperwork.
- Fill it out with your property and ownership information.
- File it with the assessor for the city or township where the home is located, not with the state.
- Keep a copy for your records.
Deadlines
Form 2368 must be filed by June 1 or November 1 to apply to the taxes levied that year. Filing right after closing is the safest approach, so you never miss a tax bill.
Also file the Property Transfer Affidavit with the same assessor within 45 days of buying the home.
When you move out
When you sell or stop living in the home as your principal residence, file Form 2602 to rescind the exemption. Failing to rescind can lead to back taxes, interest and penalties.
Frequently asked questions
Is the homestead exemption automatic when I buy?
No. You must file Form 2368 with your city or township assessor. Your title company may include the form at closing, but it's your responsibility to make sure it's filed.
How much does the homestead exemption save?
It exempts your home from up to 18 mills of school operating tax. The dollar amount depends on your home's taxable value; J.R. can estimate it for a specific home.
Do I file with the State of Michigan?
No. You file with the assessor for the city or township where the home is located.
This guide is general information, not legal or tax advice. Rules can change; check with your assessor, title company or tax professional for your situation.