Do I have to pay taxes based on current assessment even if I pay substantially less than that for the property?

Asked by Karen Davis, Detroit, MI Fri Jul 30, 2010

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Tom Lipinski, Agent, Shelby Township, MI
Fri Jul 30, 2010
So what you are asking is will next years taxes be based on the price you paid or a higher value. The city assessor will review the most recent sale (your purchase), along with other recent sales in the area to determine trends and arrive at a taxable value, which will be roughly half of what the actual value of the property is. This value will be applied to the local millage rate and will determine your tax. So it is likely that your taxes will be based on a higher value if you paid less that a market price. If you feel your taxes are based on a too high taxable value you can ask for a review. Reviews are only conducted during the first two weeks in March just after your assessment is filed in February. Feel free to contact me with further questions.
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Chip Andis, Agent, Waterford, MI
Fri Jul 30, 2010
There is Benjamin Franklin's quote "but in the world nothing can be said to be certain except death and taxes."
Property taxes that you pay at closing are not affected by the purchase price.
You pay the taxes as they were assessed for that tax year.
A review of the tax records will show a history of the taxable value and the state equalized value.
If they are not the same figure, you will see a “pop up” with the next assessment, with the change in ownership.

Buyers should not rely on the seller’s current property taxes as the amount of property taxes that the buyer may be obligated to pay in the year subsequent to purchase. A change of ownership or property improvements triggers reassessments of the property that could result in higher property taxes. Contact the county property appraiser’s office for more detailed information.

For your real estate questions, contact

Chip Andis
Cell (248) 931-0084

34 S. Telegraph Rd
Waterford, MI 48328
Office (248) 886-0000
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