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Michigan Tax Assessment

There are actually two kinds of tax problems.  The first kind is an assessment problem.  This occurs when the government and the taxpayer disagree on how much tax is owed.  These problems may include:

  • Dispute over amount of income;
  • Dispute over qualifying for a specific credit, deduction, or exemption; or
  • Dispute over whether the taxpayer owes a penalty.

Once the dispute is resolved, if there is additional tax, penalty, or interest owed that the taxpayer cannot pay, then they have a collection problem.  

This page explores how to resolve an assessment problem with the Michigan Department of Treasury.  If you believe you have a collections problem, see our page on Michigan Tax Collections for additional help.

The Tax Assessment Process

The tax assessment process starts with a taxpayer filing a tax return.  If the taxpayer does not file a tax return, the state of Michigan can still assess you a tax.  The tax return constitutes a "self assessment" of tax.  If the state of Michigan accepts your tax return as filed, then this becomes the state of Michigan's tax assessment.  A taxpayer has four years from the date the original tax return was due to file a tax return or file an amended tax return.

If the state of Michigan questions or adjusts your tax return, you now have an assessment issue.  They may first send you a letter (usually from the Discovery Unit) requesting more information to support your tax return.  This are often used if the taxpayer has claimed a particular Michigan credit or exemption.  If you respond to the letter, they will consider the new information to determine if you qualify for the specific credit/exemption you are claiming.  At some point, they will send you a notice that they either agree with your claim (which often just involves sending you a refund or canceling a previous tax bill), or they will issue a Bill for Taxes Due (Intent to Assess).

The Bill for Taxes Due (Intent to Assess), gives you 60 days to request an informal conference with the Michigan Department of Treasury.  If timely request the hearing and it is granted, you should be able to have a phone conference with a Treasury employee within about six months.  They will then issue a decision on whether you prevail.  If you do not prevail, or if the decision results in additional tax/interest/penalty due, then they will issue a Bill for Taxes Due (Final Assessment).  

The Bill for Taxes Due (Final Assessment), gives you 60 days to appeal to the Michigan Tax Tribunal or 90 days to appeal to the Michigan Court of Claims.  Either way, you must first pay the undisputed amount of tax before you can appeal the disputed amount.  If you do not appeal by the deadline, then the assessment becomes final and there is no recourse to further question the taxes.  At this point, you now have a Michigan collections issue.

Michigan Resources

If you are a taxpayer in Michigan, the following may assist you in Michigan tax assessment and collection issues.  

Specific Credits & Exemptions

Disabled Veteran Exemption

Home Heating Credit

Homestead Property Tax Exemption

Poverty Exemption

Principle Residence Exemption

General Reference

Michigan Departments

Michigan Courts & Administrative Hearings (Including Treasury Informal Conference)

Full Text Michigan Law

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