The Michigan Senate passed a bill Thursday that would allow credit unions to retain the principal residence exemption rate of taxation on residential property.
Senate Bill 81 passed 33-4, with one absentee. It was referred to the House Committee on Tax Policy, chaired by Rep. Jeff Farrington, R-Utica.
The bill was introduced by Sen. Jack Brandenburg, R-Harrison Township, chair of the Senate Finance Committee.
The legislation would allow financial institutions that take possession of properties through foreclosure to pay the lower homestead tax rate. This would reduce costs for the financial institution as well as allow more people to afford to purchase the homes since buyers would not have to be qualified based on the higher nonhomestead tax rate.
The bill would allow financial institutions to pay the lower homestead tax rate for up to two years.
MCUL government affairs team members continue to meet with state Legislature leadership teams to explain the importance of proposals such as SB 81 to Michigan’s credit unions. State-initiated reforms could provide much needed financial relief from additional compliance costs associated with new federal regulations.