Senate Bill 230 is an appropriations bill that amends the state school aid act of 1979. It allocates specific funding amounts for K-12 public schools and related educational purposes for the fiscal years ending September 30, 2025, and September 30, 2026. The bill draws funds from various state sources, including the state school aid fund and the general fund. It also designates allocations for purposes such as school loan bond redemption, cash-flow borrowing costs, and support services for children in school districts affected by drinking water emergencies, covering items like school nurses, mental health support, and nutritional services. This legislation directly affects public schools, school districts, and K-12 students across the state.
House Bill 4374 proposes to exempt certain properties from the state education tax, effective for taxes levied after December 31, 2025. This bill directly affects owners of residential real property and specific agricultural properties. To qualify, agricultural property must have a single-family dwelling occupied by an owner actively involved in farming who has not claimed a principal residence exemption on other property. The bill will only take effect if House Bill 4373 is also enacted into law.
House Bill 4379 proposes to amend the general property tax act to exempt principal residences owned and occupied by senior citizens from general property taxes. This exemption would apply to taxes levied after December 31, 2025. Instead of the general property tax, these properties would be subject to a specific tax under a separate "senior citizens principal residence specific tax act." The bill defines "principal residence" and "senior citizen" as those terms are established in that related specific tax act, and its enactment is dependent on House Bill 4372 also becoming law.
House Bill 4372 proposes a new tax system for principal residences owned and occupied by senior citizens (age 65 and older) in Michigan, effective after December 31, 2025. It would exempt these properties from the existing general property taxes. In their place, the bill levies a new "senior citizens principal residence specific tax." This new tax would be calculated at 50% of the amount that would otherwise be assessed under the general property tax act. The bill's enactment is tied to the passage of House Bill 4379.
House Bill 4373 proposes to amend the State Education Tax Act by creating new property tax exemptions. Beginning in 2026, the bill would exempt residential real property from the state education tax. It would also exempt certain qualified agricultural property that includes a single-family dwelling, provided the owner actively uses the land for agriculture and has not claimed a principal residence exemption on other property. This change directly affects owners of qualifying residential and agricultural properties by removing their obligation to pay the state education tax.
House Bill 4370 proposes a new individual income tax credit for Michigan taxpayers, directly affecting eligible students and their families. Beginning in tax year 2026, taxpayers could claim a credit equal to the sales or use tax paid on textbooks purchased for themselves or their dependents. To qualify, the student must be enrolled in an eligible Michigan institution and meet specific financial aid criteria, such as being a Federal Pell Grant recipient or a professional/graduate student who would have been Pell-eligible based on financial need. Any portion of the credit that exceeds a taxpayer's liability would be refunded.
HB 4430 would amend Michigan's Income Tax Act to create a new refundable income tax credit for taxpayers. This credit would be available for each "qualified dependent" claimed by the taxpayer. A qualified dependent must be between 5 and 18 years old, not enrolled in a public school, and demonstrate proficiency in reading and math for their grade level. The credit amount would be equal to the state's "target foundation allowance" for the relevant school year.
House Bill 4443 establishes a new "disabled veteran's homestead specific tax" on properties currently exempt from general property taxes. Beginning January 1, 2026, this tax will apply to homesteads owned by disabled veterans or their surviving spouses. The tax amount is calculated based on what would have been owed in general property taxes, then discounted (reduced) according to the veteran's disability severity rating, potentially reducing the tax to zero for those with the highest disability ratings. Unpaid specific taxes are subject to the same forfeiture and foreclosure processes as delinquent general property taxes.
House Bill 4488 proposes a new refundable working parent tax credit for Michigan taxpayers, effective for tax years beginning on or after January 1, 2025. The bill would allow a credit of $5,000 for each qualified dependent who is three years of age or less, up to a maximum of three dependents per tax year. To be eligible, a taxpayer must have at least $10,000 in earned income for the tax year. If the credit exceeds the taxpayer's income tax liability, the remaining amount would be refunded.
House Bill 4487 proposes a new state income tax credit for working parents starting in tax year 2025. This "working parent tax credit" would provide $2,500 for each qualified dependent between the ages of 4 and 6. To be eligible, taxpayers must have earned income of at least $10,000, and the credit is limited to a maximum of three dependents per tax year. Any portion of the credit that exceeds a taxpayer's liability would be refunded.
