Michigan House Bill HB4374

Michigan 2025-2026 Regular Session

• Introduced: 4/22/25
• Refer: 4/22/25

Caption

Property tax: exemptions; exemption from state education tax for certain residential property and certain agricultural property; provide for. Amends 1893 PA 206 (MCL 211.1 - 211.155) by adding sec. 9q. TIE BAR WITH: HB 4373'25

Summary

HB 4374 would amend Michigan’s General Property Tax Act to create a new exemption from the State Education Tax (SET) for certain property beginning with taxes levied after December 31, 2025. The exemption would apply to residential real property and to a narrow category of qualified agricultural property that contains a single-family dwelling, is owned and occupied by an owner actively involved in the agricultural use of the property, and is not claimed as a principal residence elsewhere. The bill is tied to HB 4373 and would not take effect unless that companion bill is enacted. In practical terms, the measure would reduce the SET burden on qualifying homeowners and certain farmer-owners, while leaving the underlying property classification rules in place. It would amend state tax law by carving out these properties from the education tax base under the State Education Tax Act.

Impact

HB 4374 would change the tax treatment of qualifying residential and agricultural property under Michigan’s property tax statutes by exempting them from the State Education Tax for future tax years. This would affect local assessors, homeowners, and certain agricultural property owners who meet the bill’s occupancy and use requirements, and it would likely reduce state education tax revenue collected from those parcels. The bill does not alter the general property tax classification system, but it adds a new exemption to the General Property Tax Act that interacts with the State Education Tax Act.

Sentiment

No committee transcripts or recorded votes were provided, so there is no direct evidence of legislative debate or formal support/opposition in the available record. Based on the bill text, the measure appears to be framed as targeted tax relief for owner-occupied homes and active farmers, which suggests a generally favorable policy posture toward those groups. The tie-bar to HB 4373 indicates the proposal is part of a coordinated package rather than a standalone change.

Contention

The main policy issue is the revenue impact on the State Education Tax and, by extension, school funding, since the bill removes certain properties from that tax base. Another possible point of contention is eligibility: the agricultural-property exemption is limited to owners actively involved in the farm use of the property and excludes those claiming a principal residence exemption elsewhere, which may raise questions about fairness, administration, and line-drawing. Because the bill is tied to HB 4373, any disagreement over the companion bill would also affect this measure’s fate.