What are property taxes based on?

On March 15, 1994, Michigan voters approved the constitutional amendment known as Proposal “A”. Prior to Proposal “A” property tax calculations were based on State Equalized Value. Proposal “A” established “Taxable Value” as the basis for the calculation of property taxes. Increases in Taxable Value are limited to the percent of change in the rate of inflation or 5%, whichever is less, as long as there were no losses or additions to the property. The limit on Taxable Value does not apply to a property in the year following a transfer of ownership (sale).

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1. What are property taxes based on?
2. What Is Assessed Value?
3. What Is State Equalized Value (SEV)?
4. What is Taxable Value?
5. What is a notice of assessment?
6. How are property taxes calculated?
7. What happens when you purchase a home?
8. What is a principal residence exemption?