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Hoffert Law Attorney Reviews Michigan’s Incredible Shrinking Personal Property Tax

Hoffert Law attorney Dave Marmon has litigated in the area of Property taxation, and has litigated personal property tax cases in the Court of Appeals and Michigan Tax Tribunal which have significantly impacted how personal property is valued for property tax purposes. As with real property taxation, businesses in Michigan have had to pay taxes on personal property based upon their value. However, the amount of those taxes has been steadily shrinking since 2008, and may disappear altogether by 2016.

The General Property Tax Act was amended in 2007 to exempt both commercial and industrial personal property from taxes levied by local school districts, (usually 18 mills; the same as what homeowners are exempted through the Principal Residence Exemption). Additionally, industrial personal property for 2008 forward is also exempted from the state education tax act to the tune of 18 mills. (MCL 211.9k)

Meanwhile, on the judicial front, Hoffert & Associates P.C. has successfully litigated Ferndale Laboratories v. Ferndale, MTT 315338 (2009) and Spartech Polycom v. St. Clair, COA 295334 (unpublished per curiam opinion, 2011). These two cases accepted the use of offered prices for products on the internet when used by an appraiser as a superior method for valuing personal property over the cost less depreciation tables used by the State Tax Commission. The result of both cases substantially reduced the amount of personal property taxation owed by these two businesses. "Despite the kicking and screaming of the State Tax Commission, the Tribunal and Court of Appeals have recognized e-commerce as a valid valuation tool in the 21st century," opined Marmon.

More recently the legislature enacted three bills in 2012. The legislature added 211.9o that exempts commercial and industrial personal property owned or controlled by the owner that is valued at less than $40,000 in each community, beginning in 2014.

At the same time, the legislature added 211.9m, which exempts newly acquired qualifying personal property for 2016 forward, by filing an affidavit not later than February 20, 2016. This bill exempts newly acquired qualified industrial personal property, as defined in that section of the act.

The third bill adds 211.9n, which exempts qualified existing industrial personal property, as defined in the act which has been previously owned for the immediately preceding 10 years, regardless of whether or not it was in the State of Michigan for those 10 years.

All 3 bills are subject to this condition: They are automatically repealed if the voters fail to approve HB 6026 of 2012 in August of 2014. HB 6026 Now PA 408 of 2012 places a new use tax on motor vehicles and mobile homes by as much as 6%. "The intended result of recent legislative activity is to significantly shrink the impact of personal property taxes on businesses. The unintended result will be to snare other businesses. All in all however, we are witnessing the incredible shrinking of the personal property tax burden in this state," observed Marmon.




Representative Clients:


IBM Corp.; Comerica Bank; Standard Federal Bank; Hughes Electronics; Toll Brothers, Inc.; Detroit Edison; Cargill Corporation; Detroit Lions, Inc.' Pep Boys; Hilton Hotels, Corporation.

helmets Our Office Location

Hoffert & Associates, P.C.
32255 Northwestern Highway, Suite 205
Farmington Hills, MI 48334
Phone: 248-702-6100
Fax: 248-702-6101
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  Hoffert & Associates

Located in Farmington Hills, Hoffert & Associates, P.C., represents clients throughout Michigan, in cities including: Traverse City, Grand Rapids,

Lansing, Ann Arbor, Detroit, Kalamazoo, Portage, Dearborn, Troy, Warren, West Bloomfield, Novi, Birmingham, Northfield, Brighton, Jackson, Battle Creek,

Flint and Saginaw. Our firm also represents clients in Oakland County, Wayne County, Macomb County,

Washtenaw County, Livingston County and Grand Traverse County.