Franz supports elimination of ‘pop-up’ tax

January 7, 2013

LANSING — Property taxes won’t increase when real estate ownership is transferred within a family under legislation recently signed into law, state Rep. Ray Franz said today.

Public Act 497 of 2012, formerly House Bill 4753, creates an exemption for property transfers between immediate family members, including by marriage and adoption, from the so-called “pop-up” tax that is applied when property ownership changes and the taxable value is uncapped.

“Eliminating the pop-up tax on property transfers within families was one of my priorities for becoming a Michigan lawmaker so it’s gratifying to have worked on this legislation,” said Franz, R-Onekama. “This law makes it more affordable to maintain ownership of property that has been in the family for years. I’m happy we were able to help people continue their traditions and legacy from generation to generation.”

Under the previous law, Michigan property tax calculations were adjusted from capped taxable values to current values upon the sale of most property. Often the new value is higher, which causes a higher tax bill for the new owners.

The new law, which requires that the transferred property remains in the residential/secondary home classification, will go into effect Dec. 31, 2013.

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