Uncapping Issues - Community Zoom Recap

By Jeff Burtka posted 12-13-2021 12:09

  

We recently held an informal discussion on Zoom on uncapping with Harley Manela of Mall Malisow & Cooney, P.C. and Jason Long of Steinhardt Pesick & Cohen, P.C. This conversation was one of several Zoom sessions we have hosted to give ICLE partners an opportunity to discuss current practice issues. It was a lively discussion with great insight from our panelists. Here are some highlights: 

 

  • Handling property assessments and retroactive uncapping. Jason Long discussed seeking relief from the board of review and appealing to the tax tribunal to challenge property assessments. He also reminded participants of the requirement to appeal a notice of retroactive uncapping within 35 days and that the appeal is limited to the issue of whether an uncapping took place.

 

  • Uncapping of real property held by business entities. We discussed the uncapping ramifications when property is held by different types of entities such as S corporations, partnerships, and LLCs. The law can be foggy when placing property into various entities. In addition, different assessors may have different opinions on whether uncapping occurs under the same set of facts.

 

  • Mirror-image rule. Jason Long discussed scenarios when the mirror-image rule might apply. However, he cautioned that the rule, though often used, is not in the statute. See chapter 2 of Real Property Taxes in Michigan for more information on the mirror image rule.

 

  • Lady Bird deeds. Harley Manela discussed different scenarios involving Lady Bird deeds and how, generally, there is no uncapping if residential property is passed to a child under a Lady Bird deed. He also discussed how a transfer to a son and his wife may cause an uncapping because daughters-in-law are not listed in MCL 211.27a(7)(u).

 

  • Trusts. We discussed several questions involving transfers of property through trusts, including transfers between trusts. Jason Long directed participants to Sebastian J Mancuso Family Tr v City of Charlevoix, 300 Mich App 1, 831 NW2d 907 (2013) for guidance on transfers between trusts.

 
Keep an eye out in the Community for announcements about future Zooms, and feel free to send me ideas for topics at jburtka@icle.org.

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