How Michigan Property Taxes Work When Buying or Selling at Year-End

Buying or selling a home in Southwest Michigan at the end of the year can come with a few extra questions — especially around property taxes. Michigan’s tax system is unique, and if you’re closing in November or December, it’s important to know what you may owe, what you may get credited for, and how property tax prorations work at closing.

Here’s a simple breakdown to help you feel confident heading into a year-end real estate transaction in Kalamazoo, Portage, Mattawan, and surrounding areas.

📌 Understanding How Property Taxes Work in Michigan

Michigan property taxes are typically billed twice a year:

• Summer Tax Bill: Usually due July 1

• Winter Tax Bill: Usually due December 1

Each bill covers the taxes for the entire calendar year, but the timing of payments doesn’t always match when a home is bought or sold. That’s where prorations come in.

📌 What Are Property Tax Prorations?

When a home is sold, the buyer and seller split the year’s property taxes based on who lived in the home—and for how long during the year.

Even if you haven’t paid the taxes yet, you’re still responsible for your portion up until the closing date.

So at closing, one party will reimburse the other depending on the timing:

• If the seller has already paid taxes for the full year, the buyer reimburses the seller for the time they owned the home.

• If the seller has not paid, the seller credits the buyer for their share, because the buyer will eventually pay the full bill.

Your closing statement will show these prorations line by line.

📌 Why Year-End Home Sales Have Extra Questions

When closing in late November or December, the winter tax bill has often just arrived — or will soon. But this can vary by township, especially in the Kalamazoo, Portage, Mattawan, Vicksburg, and Schoolcraft areas.

Some things to keep in mind:

1. You may have to pay or be credited for taxes that aren't due yet.

Even if the bill isn’t due until December, prorations still calculate what portion belongs to each party.

2. Buyers often pay the upcoming winter bill.

This is normal — but they are credited back by the seller for the seller’s share.

3. SEV and taxable value can affect estimates.

Kalamazoo County, in particular, reassesses taxable values each year.When a property transfers, the taxable value uncaps, often increasing the following year’s taxes.

Your lender and title company take this into account when estimating escrow payments.

📌 What Buyers Should Know at Year-End

✔ Expect prorated credits

You’ll likely see a tax credit from the seller on your closing disclosure.

✔ Your escrow payment may increase the following year

Because taxable value uncaps when you buy, your lender may prepare your escrow account for higher taxes starting the next cycle.

✔ Winter bills vary by municipality

For example:

• Kalamazoo & Portage winter taxes often include school operating millages

• Mattawan bill structures differ based on township (Portage Township, Antwerp Township, etc.)

📌 What Sellers Should Know at Year-End

✔ You will credit the buyer for your share of the year

Even if the bill isn’t due yet, your portion is calculated through your closing date.

✔ Pay attention to whether your winter bill has been paid

This affects whether the buyer reimburses you or you credit the buyer.

✔ Keep documentation ready

Title companies often ask for:

• Proof of tax payments

• Copies of the current tax bill

• Summer bill receipts

📌 Example: Closing on December 15 in Kalamazoo

Let's say taxes for the year are $4,000.

• Seller owned the home 11.5 months

• Buyer will own it 0.5 months

At closing:

• Seller credits the buyer for 11.5/12 months of taxes

• Buyer pays the full bill when due

This ensures each party pays only their fair share.

📌 The Bottom Line

Closing a real estate transaction at year-end in Southwest Michigan doesn’t have to be confusing. While Michigan’s property tax system has some quirks, prorations ensure both buyers and sellers pay only for the time they owned the home. Your lender, Realtor, and title company all help guide you through the process so there are no surprises on closing day.

Have Questions About Year-End Buying or Selling?

The Keefer Fischer Team is here to help Southwest Michigan homeowners navigate buying or selling — no matter the season.

If you’re thinking about making a move, we’d love to walk you through the numbers, answer your questions, and make the process simple.