State of Michigan Public Acts

PUBLIC ACT 123 OF 1999:
Shortens the amount of time property owners have to pay their delinquent taxes before losing their property.  Property owners with taxes that are three years delinquent will be foreclosed and the property will be sold at public auction.  For example, people who fail to pay their 2020 delinquent property taxes will lose their property to foreclosure in March of 2023.

With this act, the amount of time to pay taxes has been reduced from approximately five years to approximately three years.

Property owners face higher interest and fees for not paying their taxes.  Taxes that are more than two years old will have a substantially higher interest rate (1.5% per month, as opposed to the current 1%).  After two years, taxes will also have a $175 forfeiture fee and additional administrative fees added to them.
Public Act 123 of 1999

PUBLIC ACT'S 255 AND 256 OF 2020:
Modifies the General Property Tax Act in response to the Michigan Supreme Court’s decision in Rafaeli v Oakland County. In Rafaeli, the Court determined that parties with an interest in tax foreclosed real property retain a right under the Michigan Constitution to proceeds realized at auction which exceed the taxes, interest, penalties, fees, and other costs owed on that property.

Rafaeli marked a drastic change in Michigan law with respect to real property tax foreclosure and rendered unconstitutional portions of the General Property Tax Act which previously allowed Foreclosing Governmental Units to retain remaining proceeds. The Amendments essentially comprise four significant changes to the General Property Tax Act:

  • A Claims Process – A newly created MCL 211.78t establishes a process by which former interest holders can claim Remaining Proceeds realized from the sale of foreclosed property.
  • Application of Proceeds – Changes to MCL 211.78m modify the way the County treasurer applies foreclosure proceeds and clarify what costs can be recovered.
  • Notice and Reporting – Changes to various statutory notices to include reference to the newly enacted Section 78t and interested parties’ rights under that section.
  • Right of First Refusal – Changes to the requirements and procedures surrounding local units’ right of first refusal.

Public Act 255 of 2020
Public Act 256 of 2020

For more information on Michigan Legislature: www.legislature.mi.gov