If you rent your home in Michigan, you may qualify for the Michigan Homestead Property Tax Credit. This refundable credit helps offset the property taxes that are built into your rent and can increase your refund or reduce the tax you owe. The credit is claimed on your Michigan return using Form MI-1040CR.
What Is the Michigan Renter’s Credit?
Even though renters do not pay property taxes directly, Michigan treats a portion of rent as property taxes paid through the landlord. In most situations, 23% of rent paid is considered property tax for credit purposes.
The credit is designed to help low- and moderate-income Michigan residents with housing costs and is refundable, which means you may receive the credit even if you do not owe Michigan income tax.
Who Qualifies for the Michigan Renter’s Credit?
You may qualify if all of the following apply:
- You rented a home, apartment, mobile home, or room in Michigan.
- The rental property was your principal residence (homestead).
- You were a Michigan resident for at least six months during 2026.
- You paid rent under a lease or rental agreement.
- Your total household resources were not more than $73,100.
- Your housing was not exempt from property taxes.
Who Does Not Qualify?
Generally, you cannot claim the credit if:
- Your total household resources exceed $73,100.
- You lived in housing exempt from property taxes and no service fee was paid.
- You lived in university- or college-owned housing.
- You were not a Michigan resident for the required period.
- The rental property was not your principal residence.
How the Credit Is Calculated
For most renters, Michigan considers 23% of rent paid during the year to represent property taxes. The credit is then calculated using:
- Total rent paid during the year
- Total household resources
- Filing status
- Whether you qualify as a senior citizen, disabled individual, or other special claimant category
Michigan begins reducing the credit when total household resources exceed $64,100. No credit is available when total household resources exceed $73,100.
How Much Is the Credit?
The amount varies based on rent paid, income, and filing status.
For tax year 2026:
- The maximum Homestead Property Tax Credit is $1,900.
- The credit is refundable.
- Eligible renters age 65 or older may qualify for a special alternate calculation that can result in a larger credit.
What Counts as Rent?
Rent generally includes:
- Monthly rent payments
- Mobile home lot rent (after required adjustments)
- Rent paid for a room or apartment used as your homestead
Rent generally does not include:
- Utilities paid separately
- Parking fees
- Security deposits
- Government subsidies paid directly on your behalf
Special Housing Situations
Some housing arrangements require special calculations:
Subsidized Housing
Claim only the amount of rent you actually paid. Do not include any government subsidy paid on your behalf.
Service Fee Housing
If you pay service fees instead of property taxes, only 10% of your rent is treated as property taxes for credit purposes.
Mobile Home Parks
Mobile home park residents may include the specific property tax and a portion of rent when calculating the credit.
Special Housing Facilities
Residents of certain assisted living facilities, adult care homes, or other special housing arrangements may need to calculate their eligible rent or share of property taxes using special rules.
What Are Total Household Resources?
Total household resources include both taxable and nontaxable income for everyone in the household. Examples include:
- Wages
- Social Security benefits
- Pension and retirement income
- Child support
- Unemployment compensation
- Certain gifts and financial assistance
- Public assistance benefits
- Other nontaxable income sources
One of the most common mistakes is failing to include nontaxable income when calculating total household resources.
What You’ll Need to Claim the Credit
Before starting your return, gather:
- Total rent paid during 2026
- Landlord’s name and address
- Dates you lived at the rental property
- Household income information, including nontaxable income
- Information about any subsidized housing or special housing arrangements
Michigan does not require rent receipts to be filed with the return, but you should keep lease agreements, canceled checks, receipts, or bank records in case the state requests verification.
How to Enter the Michigan Renter’s Credit
To complete the credit in the program:
- State Section
- Edit Michigan using the three dots
- Credits
- Homestead Property Tax and Home Heating Credit
- Homestead Property Tax Credit Claim
Common Mistakes to Avoid
Avoid these common errors:
- Including utilities as rent
- Forgetting to report Social Security or other nontaxable income
- Claiming the credit for tax-exempt housing
- Entering incorrect landlord information
- Reporting more than 12 months of rent
- Including government-paid housing subsidies as rent paid by the taxpayer
These mistakes can delay processing, reduce the credit, or cause the claim to be denied.