July/December Boards of Review

Occasionally, assessing officers make mistakes that are not discovered until after the March board meetings have adjourned or after the tax bills are mailed to the taxpayers.  After the March Board of Review has adjourned and before or after the tax bill is received, a special Board of Review meeting can be held to correct the error.

The July/December Board of Reviews have the authority over clerical errors, mutual mistakes of fact and situations involving hardship exemptions, principal residence exemptions and qualified agricultural exemptions.

Meeting dates

    The General Property Tax Act allows for a special Board of Review meeting to be called to correct mistakes on the third Tuesday in July and the Tuesday following the second Monday in December.

      If the error is not discovered until after the December date, the taxpayer has to wait until the next July meeting of the Board.  An alternative solution to waiting for the next corrective Board meeting will be discussed later. 

    Either the assessor or the taxpayer may initiate the action to correct errors.  The Board of Review has the authority to approve the correction of errors in the current year and three years prior.   The March Board of Review does not have the authority to correct errors made in a previous year--only the July/December Boards may do so.

Purpose of the July/December Board of Review meeting
Section 53b of the General Property Tax Act states:

    (1) "If there has been a clerical error or a mutual mistake of fact relative to the correct assessment figures, the rate of taxation, or the mathematical computation relating to the assessing of taxes, the error or mutual mistake shall be verified by the local assessing officer and approved by the Board of Review at a meeting held for the purposes of this section on the third Tuesday in July and the Tuesday following the second Monday in December.  If approved, the Board of Review shall file an affidavit within 30 days relative to the errors or mutual mistake with the proper officials who are involved with the assessment figures, rate of taxation, or mathematical computation, and all affected official records shall be corrected.  If the error or mutual mistake results in an overpayment or underpayment, the rebate, including any interest paid, shall be made to the taxpayer or the taxpayer shall be notified and payment made within 30 days of the notice by the proper authorities.  A rebate shall be without interest.  The County Treasurer may deduct the rebate from the appropriate tax collecting unit's subsequent distribution of taxes.  The County Treasurer shall bill to the appropriate tax collecting unit the tax collecting unit's share of taxes rebated.  A correction under this subsection shall be made in the year in which the error was made or in the following year only.

     (2) Action pursuant to this section may be initiated by the taxpayer or the assessing officer.

     (3) The Board of Review meeting in July/December shall meet only for the purpose described in Subsection (1) and to hear appeals provided for in 7u, 7cc and 7ee.  If an exemption under section 7u is approved, the Board of Review shall file an affidavit with the proper officials involved in the assessment and collection of taxes and all affected official records shall be corrected.  If an appeal under section 7cc or 7ee results in a determination that on overpayment has been made, the Board of Review shall file an affidavit and a rebate shall be made at the times and in the manner provided in subsection (1).  Except as otherwise provided in sections 7cc and 7ee, a correction under this subsection shall be made for the year in which the appeal is made only.  If the Board of Review grants an exemption or provides a rebate for property under section 7cc or 7ee as provided in this subsection, the Board of Review shall require the owner to execute the affidavit provided for in section 7cc or 7ee and shall forward a copy of any section 7cc affidavits to the department of treasury.

     (4) If an exemption under section 7cc is granted by the Board of Review under this section, the provisions of section 7cc(6) through (8) apply.  If an exemption under section 7cc is not granted by the Board of Review under this section, the owner may appeal that decision in writing to the department of treasury within 35 days of the Board of Review's denial and the appeal shall be conducted as provided in section 7cc(7).

      (5) An owner or assessor may appeal a decision of the Board of Review under this section regarding an exemption under section 7ee to the residential and small claims division of the Michigan Tax Tribunal.  An owner is not required to pay the amount of tax in dispute in order to receive a final determination of the residential and small claims division of the Michigan Tax Tribunal.  However, interest and penalties, if any, shall accrue and be computed based on interest and penalties that would have accrued from the date the taxes were originally levied as if there had not been an exemption." (MCL 211.53b)

 1.  Correcting errors
     According to the General Property Tax Act, a July/December special meeting of the Board of Review shall be called to correct any of the following errors in an assessment or tax bill:

• A clerical error, such as the erroneous posting of an assessment as $250,000 when it should have been $25,000;
• A mutual mistake, such as a building being assessed to the wrong description;
• A mistake in the millage rates, such a levying 32 mills instead of 30.2 mills, and
• A mistake in a mathematical calculation, such as 40 acres by $750 equaling $22,800 instead of $30,000.

    On March 29, 1996, in International Place Apartments vs. Ypsilanti Township, 1996 Mich. App. 79, the Michigan Court of Appeals clarified the meaning of the term "clerical error" found in MCL 211.53b.  The court stated that July/December Boards of Review are allowed to correct clerical errors of "typographical or transpositional nature." 

2. Principal Residence Exemption from certain local school operating taxes.

   The July/December Boards of Review have limited authority to grant exemptions from the 18 mills of local school operating taxes.  Owners who qualify are required to file a principal residence exemption affidavit (Form T-1056) with the July/December Board of Review.  These affidavits serve as petitions requesting exemption from the board, and no other petitions are necessary.  These affidavits are sent to the Michigan Department of Treasury.

    An owner who owned and occupied a principal residence on May 1 for which the exemption was not on the tax roll may file an appeal with the July/December Board of Review in the year for which the exemption was claimed, the immediately preceding year or the immediately succeeding year.  If an appeal of a denial of a claim for exemption is received no later than five calendar days prior to the July/December Board of Review date, the local tax collecting unit must convene a July/December Board of Review and consider the appeal pursuant to Section 53b.

    The July/December Board of Review does not have the authority to grant principal residence exemptions to properties which did not qualify on May 1 if the properties have already been denied for the year in question by the assessor, the Michigan Department of Treasury or the Michigan Tax Tribunal.  The July/December Board of Review does have the authority to deny an exemption claim from an owner who appeals at that Board of Review to request the exemption if the Board has reason to believe that the property was not owned and occupied as a principal residence on May 1 of that year.

    If an assessor intends to recommend that a particular affidavit not be accepted by the Board of Review as filed, the assessor is advised to notify the owner of the assessor's intention so that the owner may appear at the Board of Review session.  An assessor who disagrees with the Board of Review may appeal that decision to the Michigan Department of Treasury.

    It is the State Tax Commission's opinion that owners may appeal to obtain the principal residence exemption by letter regardless of whether they are residents or nonresidents.  This does not apply to the March Board of Review.  An owner may also authorize someone to appear on his or her behalf.  

3. Qualified agricultural property exemption from certain local school operating taxes

    The July/December Board of Review may review exemption claims for property classified by the assessor as agricultural or property not classified as agricultural but which is devoted primarily to an agricultural use as defined in Section 2 of the Farmland and Open Space Preservation Act which did not receive exemption from 18 mills of local school operating taxes.

    Property classified as agricultural is not required to file a farmland exemption affidavit (Form T-1063) unless the assessor believes that all or part of the property does not qualify for the exemption because it is used for commercial or industrial purposes or that a residence is not occupied by someone engaged in agricultural operations.  Property that is not classified as agricultural but whose acreage is more than 50 percent devoted to a defined agricultural use is required to file the farmland exemption affidavit by May 1.  The assessor should retain the affidavit and not forward it to the Michigan Department of Treasury.

    The July/December Board of Review is authorized to grant the qualified agricultural exemption to property for which a farmland affidavit was filed by the owner and the exemption was denied by the assessor if the board rules that it does qualify for the exemption because of facts that have been brought to its attention.  Properties in this category would usually be properties which are classified other than agricultural and which are devoted primarily to an agricultural use as defined by Section 2 of Public Act 116 of 1974, the Farmland and Open Space Preservation Act. 

    If the assessor has denied an exemption to an owner who has filed a farmland affidavit, the assessor must notify the owner of the denial, state the reason for denial and inform the owner of the right to appeal to the July/December Board of Review.  Appeals under this section may also be made to the March Board of Review.  The State Tax Commission recommends that assessors issue denials by July 1 of the current year.

    An owner of qualified agricultural property as of May 1 for which an exemption was not on the tax roll may file an appeal with the July/December Board of Review in the year the exemption was claimed, the immediately preceding year or the immediately succeeding year.

    An owner of qualified agricultural property as of May 1 for which an exemption was denied by the assessor in the year the affidavit was filed, may file an appeal with the July/December Board of Review for the current year only.

    Owners who believe that they qualify for exemption are required to file the farmland exemption affidavit with the Board of Review to obtain an exemption from the board.  These affidavits are to be retained by the assessing unit and shall not be forwarded to the Michigan Department of Treasury.

    It is the State Tax Commission's opinion that owners may appeal to obtain the qualified agricultural property exemption by letter, regardless of whether they are residents or nonresidents.  This does not apply to the March Board of Review.  An owner may also authorize someone to appear before the Board of Review on his or her behalf.

4.  Hardship exemptions

    Public Act 74 of 1995 now allows hardship exemption appeals to be made to the July/December Boards of Review for the current year only.  A taxpayer who already appealed to the March Board of Review for a poverty exemption may not also appeal to the July/December Board of Review for the same exemption.  Poverty exemptions denied by the March Board of Review may be appealed to the Michigan Tax Tribunal by June 30 of the current year.  See page 87 of Chapter 7 for a detailed description of the hardship exemption process.

5.  Omitted properties

    Sometimes a parcel of real or personal property is omitted from the assessment roll.  The July/December Board meetings can be used to place the property on the roll for the current and the previous year.

    There is another process by which the property may be assessed for the current year and the two previous years.  "If it shall be made to appear to the State Tax Commission at any time that as a matter of fact any property liable to taxation has been incorrectly reported or omitted for any previous year, but not to exceed the current assessment year and 2 years immediately preceding the date of discovery and disclosure of the incorrect reporting or of the omission, the State Tax Commission shall place the corrected assessment value for the appropriate years on the then current assessment roll...In case of change in ownership of the property these taxes shall not be spread against the property prior to the last change of ownership." (MCL 211.154(1)).

    "A person to whom property is assessed pursuant to this section may appeal the State Tax Commission's determination to the Michigan Tax Tribunal." (MCL 211.154 (4)).

Appeal of July/December Board of Review decisions

  A taxpayer may appeal the decision of the July/December Board of Review within 30 days of the corrective Board of Review's decision.  If the decision involves the correction of a clerical error, mutual mistake or mathematical calculation or the denial of need for correction of these items, the  taxpayer must appeal directly to the Michigan Tax Tribunal.

    If the matter involves the principal residence or qualified agricultural exemption, the General Property Tax Act dealing with the corrective Board of Review provides for separate appeal procedures, depending on whether the exemption granted or denied by the July/December Boards was for principal residence or for qualified agricultural property.

Principal Residence Exemption appeals 

    If a principal residence exemption is granted by the Board of Review, the assessor may appeal that decision to the Michigan Department of Treasury within 35 days of the Board's decision by following the procedures found in section 7cc(6) through (8) of PA 74 of 1995.  If the exemption is denied by the Board of Review, the property owner may appeal that decision to the Michigan Department of Treasury within 35 days of receipt of the notice of denial.

    The Department of Treasury shall determine if the property is the principal residence of the owner claiming the exemption.  The owner may then appeal an adverse decision of the Department of Treasury to the Department of Treasury for an informal conference.  The final decision of the Department of Treasury may then be appealed to the residential and small claims division of the Tax Tribunal within 35 days of that decision by either to the owner or an assessor who has forwarded a recommendation of denial to the Department of Treasury.

    The owner is not required to pay the amount of tax in dispute in order to receive a final determination of the tribunal.  However, interest and penalties, if any, shall accrue and be computed based on interest and penalties that would have accrued from the date the taxes were originally levied as if there had not been an exemption.

Qualified agricultural property exemption appeals

    An owner or assessor may appeal a decision by the July/December Board of Review regarding an exemption for "qualified agricultural property" directly to the residential and small claims division of the Michigan Tax Tribunal within 30 days of the Board of Review's action.  The owner is not required to pay the amount of tax in dispute in order to receive a final determination of the residential and small claims division.

Rescission of Principal Residence Exemption

    MCL 211.7cc(9) provides that when a property owner files an affidavit for a principal residence exemption, that filing rescinds all previous principal residence exemptions filed by that owner for any principal residence in Michigan.

    The Michigan Department of Treasury is required by law to notify an assessor when the department rescinds a principal residence exemption of property located in the assessor's unit.  The assessor is then required to remove the principal residence exemption effective December 31 of the year the rescission is effective.  The law states that the rescission is effective on December 31 of the year the property is transferred or no longer used as a principal residence.

Appeal of principal residence Rescission

    Public Act 476 of 1996 provides for an appeal to the July/December board or review by a property owner whose principal residence exemption has been rescinded (MCL 211.7cc(10)).  An appeal of the rescission of a principal residence exemption may only be made in the year it was rescinded or the immediately succeeding year.  For example, if an assessor rescinds a principal residence exemption in June 1997 for 1995, 1996 and 1997, the owner may appeal that rescission to the 1997 or 1998 July/December Board of Review.

    A property owner whose exemption is rescinded may appeal the July/December Board of Review's decision to the Residential and Small Claims division of the Michigan Tax Tribunal within 35 days of that decision.

    MCL 211.7cc(10) as amended states that a local tax collecting unit shall hold a July/December Board of Review if an appeal of rescission to the July/December Board of Review is received no later than five days before the July/December Board of Review date.

Stipulations

   If the assessing unit discovers an error after the July/December Board of Review meeting and wishes to have the error corrected sooner than the next December board meetings and the taxpayer agrees that a mistake has been made, the assessor and taxpayer may sign a stipulation, which is a written agreement to certain facts.  The stipulation is forwarded to the Michigan Tax Tribunal for review.  The tribunal will scrutinize the document and if everything is in order, a tribunal member will sign a consent judgment to amend the assessment to the amount agreed to in the stipulation.

Notice to taxpayers 

    Whenever the correction of a clerical error increases assessed value or the property tax bill, the property owner should be notified so he or she may appear at the special meeting of the board to discuss the corrective action to be taken and to challenge any decision of the board.

    If a property owner is affected by a July/December Board of Review action and protests that action to the board, that person may appeal to the Tax Tribunal within 30 days of the board's decision.  If the Property owner or taxpayer does not protest, the tribunal has no jurisdiction.

Restrictions

    The July/December Board of Review  authority to revise assessments is limited to correcting errors.  July/December Boards of Review may not consider valuation or exemption disputes, except for specific principal residence, qualified agricultural and hardship exemptions as explained in this chapter.  Valuation and other exemption disputes are to be considered by March boards of review.

    July/December Boards of Review do not have the authority to roll back the assessments of an entire class of property or to make corrections to special assessment rolls.  In addition, on March 29, 1996, the Michigan Court of Appeals stated that July/December Boards of Review and not allowed to revalue or reappraise property when the reason for the action is that all relevant information was not originally considered by the assessor (International Place Apartments vs. Ypsilanti Township, 1996 Mich App. 79). 

Changes to capped, taxable and assessed values

    When the July/December Board of Review corrects a clerical error or mutual mistake of fact that changes the assessed or capped value, it must determine if this correction has also changes other values.  For instance, a change in the assessed value may cause the taxable value to change.  This could happen because the taxable value is the lesser of the assessed value (after applying the equalization factor) and the capped value.

    If the July/December Board of Review changes the capped value by changing the amount of an addition or loss to the property, it must also include the effects of this change in the assessed value, if the same error exists there.  This would also cause the taxable value to change.

    The law requires that the tax roll show the taxable value for each parcel of property.  Once the capped value and assessed value are properly calculated, the taxable value is the lesser of the two.  If this is calculated correctly, the Board of Review should not raise or lower the taxable value unless it has also raised or lowered the assessed and/or capped value.  An exception to this rule may occur if the July/December Board of Review uncapped the taxable value of a property that had a transfer of ownership in the prior year but had not been timely uncapped by the assessor due to a clerical error or mutual mistake of fact.

    If the July/December Board of Review makes a change in the prior year's taxable value, the board must consider whether this change also changes the current year's taxable value.  If it does, the board must also correct the current year's taxable value.  For example, if the 1997 July/December Board of Review made a change that cause a property's 1996 taxable value to change, the board must recalculate the property's 1997 capped value using the correct 1996 taxable value as the first element in the formula.  The Board of Review must then compare the property's recalculated 1997 capped value using the property's 1997 SEV.  The lesser value will become the 1997 taxable value.  If this value differs from the 1997 taxable value on the 1997 tax roll, the July/December Board of Review must enter the correct 1997 taxable value on the 1997 tax roll.

    July/December Board of Review must fill out Form L-4035 a whenever they make a change that causes a property's taxable value to change. See page 182 for instruction on filling out this form.

Open Meetings Act

    The December meetings are governed by the provisions of the Open Meetings Act as discussed in Chapter 4.  All the provisions of that act, including advertising or posting the date, time and place of the meeting and allowing the public to attend and address the board, must be met.  Meeting minutes must be recorded and filed with the township or city clerk.

Notice to taxing units

    Upon completion of the agenda, the board should sign an affidavit affirming the clerical errors and approving of the corrections as verified by the assessor.  All taxing units are to be notified by the Board of Review within 30 days, and a copy of the recapitulation of changes is required to be filed with the State Tax Commission.

    Sections 53b(1) of PA 74 of 1995 require the Board of Review to file an affidavit within 30 days when an appeal of the exemption for principal residence or qualified agricultural property or the hardship exemption results in a change.  The officials to be notified are the State Tax Commission, the county equalization department and all taxing units affected by the change, such as the local unit treasurer or the school board treasurer.  The treasurer shall refund any overpayment including any interest already paid to the taxpayer.  If additional taxes are due because of an action by a July/December Board of Review, payment is due without interest or penalties within 30 days of receipting the corrected billing.

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