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A Better Partnership
May 29, 2013

COA holds that taxpayer failed to prove entitlement to homestead tax exemption

In Power v. Michigan Dept of Treasury, the Michigan Court of Appeals held that a taxpayer was not entitled to a homestead tax exemption because although he leased a house on the property, he did not provide any evidence that he owned the property or that he was a shareholder in the corporation that did. Under the General Property Tax Act, MCL 211.7cc(1), the owner of a principal residence may claim an exemption from the local school district tax. The taxpayer has the burden of proving his ownership. In this case, the Michigan Department of Treasury denied the corporation a primary residence exemption, on the grounds that a corporation is not an 'owner' under the statute. The taxpayer then attempted to claim the exemption for himself, but was denied by the Department of Treasury and the Michigan Tax Tribunal. The Court of Appeals ultimately affirmed the Tax Tribunal, holding that even though the house was the taxpayer's principal residence, he was not entitled to the property tax exemption because he did not provide any proof that he owned the property.

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