LANSING, Mich. — Legislation that would reform Michigan’s property tax exemption for 100% disabled veterans by shifting the tax burden from local units of government to the state Department of Treasury was approved by the Senate Finance Committee on Wednesday.
Senate Bills 783 and 784, sponsored by Sen. Jon Bumstead, would maintain the same level of tax relief for 100% disabled veterans but would transform the benefit from a property tax exemption to an income tax credit in order to ease the burden on local governments.
“This is a small but necessary change to existing law that, importantly, protects our 100% disabled veterans’ tax credits and the process they use to obtain them,” said Bumstead, R-Newaygo. “What it does do, however, is put the burden of administering the credit on the state’s shoulders to help alleviate the financial stress many local governments are experiencing throughout Michigan. The process for eligible veterans to claim the credit remains the same, while cities, villages, townships, and counties get much-needed financial relief — it’s a win-win. I thank my colleagues on the Senate Finance Committee for their support of this legislation.”
The process for eligible veterans to claim their credit would continue unchanged — a disabled veteran, or widow of a disabled veteran, would file an affidavit with their local unit of government to claim the exemption, which would then defer property tax collection until the Department of Treasury dispenses payment for reimbursement.
Upon payment by the state, the local unit would provide written notification to the individual who filed the affidavit explaining the payment or rejection by the state, as well as any additional amount that may be due and the subsequent due date.
SBs 783-784 now advance to the full Senate for consideration.