Eligibility

• To qualify for the homestead property tax credit, you have to be a resident of Michigan for a minimum of six months, must have paid property taxes and your household income cannot be more than $82,650. You must include the income of everyone who lives in the home that contributes to the financial support of the household in your household income calculations. Aside from your wages, you must also include spousal support payments and Department of Human Services (DHS) payments you received throughout the year as income.
  
  

Claiming the Credit

• If your entire home is for living space, you may claim the tax credit for 100 percent of the square footage of your home. If you run a business out of your home, you may only claim the tax credit for the portion of your home that you use as a living space and not the portion of your home that is for business use. For instance, if you use 10 percent of your home's square footage for business purposes, you can claim the credit for the 90 percent of your home's square footage you use for living space.
  
  

Renters

• If you rent a home or apartment, Michigan generally considers 20 percent of your rent payment as going toward paying property taxes. If you have roommates each of the roommates can claim the homestead tax credit individually based on the amount of rent they pay. If the home is exempt from paying property taxes, no one living in the home is eligible for the homestead property tax credit.
  
  

Credit Phase Out

• The homestead property tax credit begins to phase out in increments of 10 percent once your household income $73,651. This means if your household income is below $73,651, then you can claim 100 percent of the credit. At time of publication, the phase out levels according to income level are as follows: you can claim 90 percent of the credit if your household income is between $73,651 and $74,650; 80 percent for income between $74,651 and $75,650; 70 percent for income between $75,651 and $76,650; 60 percent for income between $76,651 and $77,650; 50 percent for income between $77,651 and $78,650; 40 percent for income between $78,651 and $79,650; 30 percent for income between $79,651 and $80,650; 20 percent for income between $80,651 and $81,650; and 10 percent for income between $81,651 and $82,650.