March 26, 2003, Introduced by Rep. Jamnick and referred to the Committee on Tax Policy.
A bill to amend 1967 PA 281, entitled
"Income tax act of 1967,"
by amending section 508 (MCL 206.508), as amended by 1990 PA
283.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
1 Sec. 508. (1) "Gross rent" means the total rent contracted
2 to be paid by the renter or lessee of a homestead pursuant to
3 dealing at arms' length with the landlord of the homestead.
4 When If the landlord and tenant have not dealt with
each other
5 at arms' length and the department believes that the gross rent
6 charged is excessive, the department may adjust the gross rent to
7 a reasonable amount for the purposes of this chapter.
8 (2) "Homestead" means a dwelling or unit in a multiple-unit
9 dwelling that is subject to ad valorem taxes, or a service charge
10 in lieu of taxes as
provided by section 15a of Act No. 346 of
1 the Public Acts of
1966, as amended, being section 125.1415a of
2 the Michigan Compiled
Laws the state housing
development
3 authority act of 1966, 1966 PA 346, MCL 125.1415a, owned and
4 occupied as a home by the owner of the dwelling or unit, or
5 occupied as the dwelling of the renter or lessee, including all
6 unoccupied real property not classified for ad valorem tax
7 purposes as commercial, industrial, residential, or timber-cut
8 over, owned by the owner of the homestead. Beginning in the 1990
9 tax year, a homestead does not include unoccupied real property
10 that is leased or rented by the owner to another person and that
11 is not adjacent and contiguous to the home of the owner.
12 Additionally, the following apply:
13 (a) If a homestead is an integral part of a larger unit of
14 assessment such as commercial, industrial, residential,
15 timber-cut over, or a multipurpose or multidwelling building, the
16 tax on the homestead shall be the same proportion of the total
17 property tax as the proportion of the value of the homestead is
18 to the total value of the assessed property.
19 (b) If the gross receipts of the agricultural or
20 horticultural operations do not exceed the household income, or
21 if there are no gross receipts, the following apply:
22 (i) If the claimant has lived on the land 10 years or more,
23 all of the adjacent and contiguous agricultural or horticultural
24 lands shall be considered a homestead and the credit is allowed
25 for all the land.
26 (ii) If the claimant has lived on the land less than 10
27 years, not more than 5 acres of adjacent and contiguous
1 agricultural or horticultural land shall be considered a part of
2 the homestead and the credit is allowed for that part of the
3 land.
4 (c) A mobile home or trailer coach in a trailer coach park is
5 a homestead and the site rent for space is considered the rent of
6 a homestead. The
specific tax levied by section 41 of Act
7 No. 243 of the Public
Acts of 1959, being section 125.1041 of the
8 Michigan Compiled Laws
1959 PA 243, MCL 125.1041, is
considered
9 a property tax.
10 (3) "Household" means a claimant and spouse.
11 (4) "Household income" means all income received by all
12 persons of a household in a tax year while members of a
13 household. For tax years that begin after December 31, 2002 and
14 for purposes of sections 520 and 522 only, household income does
15 not include social security benefits as defined in section 86 of
16 the internal revenue code.