What Is the Michigan Renters Credit?

The Renters Credit is part of Michigan’s Homestead Property Tax Credit program. While it traditionally benefits homeowners, renters can also qualify because a portion of their rent is presumed to cover property taxes. In Michigan, 23% of your annual rent is considered to be property tax equivalent when calculating your potential credit.

Who Is Eligible in 2025?

To qualify for the Renters Credit on your 2024 tax return (filed in 2025), you must meet several conditions:

✅ General Eligibility Requirements:

• You were a Michigan resident for at least six months during 2024.
  
  

• You occupied a Michigan homestead (rental unit) for at least six months.
  
  

• Your total household resources (income including Social Security, pensions, and unemployment compensation) do not exceed $63,000.
  
  

• Your homestead (rented unit) was subject to property taxes. Note: Subsidized housing and tax-exempt properties often do not qualify.
  
  

✅ Additional Considerations:

Additional eligibility applies if any of the following describe you:

• 65 or older
  
  

• Blind or disabled
  
  

• A veteran with a service-connected disability
  
  

• A surviving spouse of a veteran who met the above conditions
  
  

How Much Can You Get?

The maximum credit is $1,800. The actual amount is based on a formula that considers your household income and the total property tax equivalent paid via rent. The lower your income, the higher the credit percentage you're likely to receive.

Remember, the 23% assumption means if you paid $10,000 in rent for the year, $2,300 of that is considered property tax for purposes of the credit.

What Doesn’t Qualify?

Not every rental situation will make the cut:

• College dorms, tax-exempt buildings, or government-subsidized housing do not qualify.
  
  

• Rent paid to relatives (like a parent or sibling) may disqualify you unless they report it as rental income.
  
  

• If your rent was paid on your behalf (e.g., through housing vouchers), only the portion you personally paid qualifies.
  
  

How to Claim the Credit

To claim your Renters Credit:

• File Schedule CR-1040CR with your Michigan state tax return.
  
  

• Include proof of rent paid — a rent receipt or signed statement from your landlord listing the total amount paid, address of the property, and the landlord’s name and contact details.
  
  

It’s best to request this documentation early, especially from smaller landlords who may not provide it proactively.

Final Thoughts from a Tax Veteran

Year after year, I encounter clients who’ve missed out on the Renters Credit simply because they didn’t know they qualified. If you rent and your income meets the threshold, this credit can offer meaningful relief — especially as housing costs continue to rise.

Don’t leave money on the table. If you’re unsure of your eligibility or need help filing, please reach out to schedule an appointment. Your refund may depend on it.

Selling a Rental Property: What You Need to Know About Taxes (Without the Jargon)

If you’re thinking about selling your rental property, congratulations—it’s a big decision, and one that often comes with a nice financial reward. But before you count your profits, there’s one thing you shouldn’t overlook: taxes.

Now, I know what you might be thinking—“Taxes? I’ll figure that out later.” But understanding how taxes work when you sell a rental property can help you avoid surprises and keep more of your money. Don’t worry—you don’t need to be a tax expert to follow along. I’m going to walk you through it in plain English.

When You Sell, You May Owe Capital Gains Tax

When you sell something valuable—like a house, stock, or rental property—and you make a profit, the IRS considers that a capital gain, which means you may owe capital gains tax.

Here’s how it works:

Let’s say you bought a rental property for $250,000 a few years ago, and you just sold it for $400,000. That’s a $150,000 profit—or what the IRS calls a gain.

But that’s not the full story. To figure out how much tax you might owe, the IRS looks at things like:

• What you originally paid for the property
  
  

• How much you spent on improvements (like a new roof or kitchen)
  
  

• How much depreciation you claimed on your taxes while renting it out (we’ll get to that)
  
  

Depreciation: What It Is and Why It Matters

If you rented out your property, your tax preparer likely helped you claim something called depreciation. That just means you got to deduct a portion of the property’s value each year to account for wear and tear.

Sounds great, right? It is—but when you sell the property, the IRS wants some of that money back. This is called depreciation recapture, and it’s taxed at a higher rate than your regular profit. You don’t have to do any math right now, but just know this: depreciation affects how much tax you’ll owe when you sell.

Long-Term vs. Short-Term Capital Gains

If you owned the property for more than a year (which most rental owners do), the gain is taxed at long-term capital gains rates—which are lower than regular income tax. Depending on your total income, this tax rate could be:

• 0%
  
  

• 15%
  
  

• 20%
  
  

The exact percentage depends on your income level. If you’re unsure, a tax preparer can help estimate it.

Can You Reduce or Avoid the Tax?

Yes, there are legal ways to reduce or defer taxes on your profit. Here are a few options:

1. 1031 Exchange (Tax Deferral)

If you plan to buy another rental property, you might be able to delay paying taxes by using a 1031 exchange. It’s a bit complicated, but basically, you roll the profit from your sale into a new property. You’ll still pay taxes eventually—just not right now. This takes proper set-up and must be started prior to selling the property.

2. Selling Over Time (Installment Sale)

Instead of getting paid all at once, you could finance the sale yourself and collect payments from the buyer over time. This might reduce your yearly tax bill by spreading the income out.

3. Use Losses to Offset Gains

If you lost money on other investments this year, those losses can cancel out some of your gain, reducing your tax bill.

What About State Taxes?

Depending on where the property is located, your state might charge its own capital gains tax. Some states—like California and New York—can take a pretty big bite. Others, like Florida or Texas, don’t have a state income tax at all. Make sure you factor this in when estimating your final profit.

Final Thoughts: Don’t Go It Alone

Selling a rental property is a major financial event, and the taxes can be complicated—but they don’t have to be overwhelming. A qualified tax professional can walk you through your options and help you plan smart.

Talk to a tax expert before you sell, not after. With the right plan, you’ll know exactly what to expect and how to minimize what you owe.

Thinking of selling your rental property?
Schedule a consultation and let’s walk through your numbers together—so you can keep more of your hard-earned profit and avoid tax-time surprises.

Filing your taxes can feel confusing, especially when deciding between the standard deduction and itemized deductions. Picking the right one can save you money. Let’s break down how they work, the pros and cons of each, and when you might want to use them.

What is the Standard Deduction?

The standard deduction is a set amount of money that you can subtract from your taxable income. It’s the easier option and available to everyone.

📊 Standard Deduction for 2025

Filing Status Standard Deduction

Single $14,000

Married Filing Jointly $28,000

Head of Household $20,800

What are Itemized Deductions?

Itemized deductions are specific expenses you can list on your tax return to lower your taxable income. Instead of a fixed amount, you add up the total of eligible expenses like:

• Medical expenses above a certain limit

• Mortgage interest

• State and local taxes (up to $10,000)

• Charitable donations
  
  

Pros and Cons of the Standard Deduction

✅ Pros:

• Super simple to claim

• No need to keep detailed records
  
  

• Saves time
  
  

❌ Cons:

• Might not give you the biggest tax savings if you have a lot of deductible expenses
  
  

Pros and Cons of Itemizing

✅ Pros:

• Can lower your taxes more if you have big deductible expenses

• Better reflects what you spent money on
  
  

❌ Cons:

• Takes more time and effort

• You need receipts and records

• Only helpful if your total deductions are bigger than the standard deduction
  
  

How to Decide

The best way to decide is to compare both. If your total itemized deductions are more than the standard deduction, itemizing might save you more. Otherwise, sticking with the standard deduction is usually better and easier.

💡 Quick Decision Flow
👉 Do your deductible expenses add up to more than the standard deduction?
✅ Yes? Itemize!
❌ No? Standard deduction!

Final Thoughts

Choosing between the standard deduction and itemizing doesn’t have to be stressful. Take a look at your expenses, do the math, and see which option saves you more.

For personalized help and to make sure you’re getting the best outcome, consider talking to a tax professional. They can explain the rules in detail and make sure you’re not missing out on savings.

📣 Need help with your taxes? Contact our tax professionals today!

Quarterly Tax Planning: How to Stay Ahead and Avoid Surprises

I. Introduction

Tax planning shouldn’t be a once-a-year scramble in April. For business owners, freelancers, and anyone with multiple income streams, taking a quarterly approach to taxes is a smart way to stay in control financially. Quarterly tax planning helps you avoid penalties, optimize cash flow, and make confident business decisions all year long.

II. What Is Quarterly Tax Planning?

Quarterly tax planning involves estimating and paying your taxes four times a year, based on your income and deductions to date. This approach is especially critical for those who don’t have taxes automatically withheld—like self-employed professionals or those with significant investment income.

The IRS requires estimated payments to be made on:

• April 15

• June 15

• September 15

• January 15 (of the following year)

Failing to make these payments can lead to penalties and interest, even if you end up paying the full amount by April.

III. Who Needs to Plan Quarterly?

Quarterly tax planning isn’t just for business owners—it’s essential for a wide range of earners. You likely need to plan quarterly if you:

• Are self-employed or run a small business

• Work as a freelancer, consultant, or contractor

• Receive significant investment income, rental income, or alimony

• Expect to owe more than $1,000 in taxes at year-end (after withholding and credits)

IV. Key Benefits of Quarterly Tax Planning

1. Avoid Penalties
   Staying compliant with the IRS’s quarterly deadlines helps you avoid unexpected fines and late fees.

2. Improve Cash Flow
   Planning for taxes quarterly lets you set aside smaller amounts throughout the year, rather than one large payment in April.

3. Make Strategic Financial Decisions
   You can time purchases, retirement contributions, or hiring based on your quarterly review—leading to better outcomes at year-end.

4. Reduce Stress
   Knowing your tax situation is under control throughout the year means no more surprises come tax season.

V. Steps for Effective Quarterly Tax Planning

1. Estimate Your Income and Tax Liability
   Use your current year’s income and expenses to calculate how much you’ll owe. Base this on historical data if you're unsure.

2. Track Expenses and Deductions Continuously
   Don’t wait until December to gather receipts. Ongoing tracking helps ensure you capture every eligible deduction.

3. Use Accounting Software or a Tax Professional
   Digital tools and experienced advisors help you avoid errors and stay organized.

4. Review and Adjust Each Quarter
   Your income can fluctuate, so revisit your estimates regularly. Adjust payments as needed to reflect reality.

5. Set Aside Funds Monthly
   Create a habit of reserving a portion of income each month specifically for taxes. This makes quarterly payments easier to manage.

VI. Common Mistakes to Avoid

• Forgetting about non-salary income like dividends, rental income, or side gigs

• Underestimating your tax liability, leading to penalties

• Missing quarterly deadlines, which could result in fines

• Ignoring state and local taxes, which often have separate rules

VII. How an Accountant Can Help

Partnering with a tax professional provides peace of mind. An accountant can:

• Prepare customized tax projections tailored to your unique situation

• Ensure compliance with federal, state, and local tax laws

• Identify tax-saving strategies and timing opportunities

• Manage documentation and filings efficiently

With professional support, quarterly planning becomes less of a chore and more of a strategic advantage.

VIII. Conclusion and Call to Action

Quarterly tax planning is more than a compliance task—it’s a powerful financial management tool. By planning ahead, you’ll avoid surprises, manage your cash flow wisely, and make decisions that positively impact your bottom line.

Ready to take control of your taxes year-round? Schedule a free consultation with our team today and receive a personalized quarterly tax checklist to get started!

🧾 Key Tax Changes for Individuals

1. Permanent Standard Deduction Increases

Standard deduction has been permanently raised:

Single: $15,750

Head of household: $23,625

Married filing jointly: $31,500, all indexed for inflation 

2. SALT Deduction Cap Temporarily Raised

State and local tax (SALT) deduction cap increased to $40,000 for 2025–2029 (indexed), phased out for MAGI over $500k and reverting to $10k from 2030 

3. Boosted Child Tax Credit

Credit increased from $2,000 to $2,200, with the refundable portion pegged at $1,400, and indexed for inflation 

4. Senior Tax Break

New above-the-line deduction of $6,000 for taxpayers aged 65+, phasing out for MAGI over $75k (single) or $150k (joint) for 2025–2028 

5. New Deduction for U.S.-Assembled Auto Loans

Up to $10,000 deduction annually for interest paid on personal auto loans for vehicles assembled in the U.S. (2025–2028), phasing out above MAGI $100k/$200k 

6. Temporary Tip & Overtime Income Deductions

Tax deduction up to $25,000 for tips and $12,500/$25,000 for overtime pay (single/joint) for income under $150k/$300k, valid through 2028 

7. “No Itemize” Charitable Deduction

Starting in 2026, non-itemizers can deduct up to $1,000 (individuals) or $2,000 (joint) in charitable cash contributions 

8. “Trump Accounts” for Kids

Establishes savings accounts for children born 2025–2028:

Federal $1,000 initial deposit at birth

Parents can contribute up to $5,000/year (tax-advantaged) 

⚠️ Trade-offs & Expiring Incentives

Clean-energy credits like EV purchase, solar panels, and hydrogen investments are being phased out, some expiring as early as Sept/Dec 2025 

The expanded SALT cap and other temporary benefits sunset between 2028–2030, requiring forward planning 

✅ What You Should Do

Action Why It Matters

Time purchases Especially auto loans or clean-energy projects before sunset dates

Plan charitable giving Consider relying on non-itemized deduction (2026 onward)

Review quarterly withholding Adjust now to capture new deductions

Watch sunset timelines Some benefits last only until 2028–2030

This list summarizes the major tax changes for individual taxpayers that have been enacted recently. We understand that you may have specific questions about how these adjustments will impact your personal tax situation, and we are here to provide clarity.

As of today, tax professionals are still awaiting further detailed guidance from the IRS regarding a more comprehensive list of tax changes and the precise methods for their implementation going forward. We are closely monitoring these developments to ensure we have the most current information.

Should you wish to discuss these changes in the context of your unique financial circumstances or need assistance navigating their implications, please do not hesitate to schedule a personalized consultation with us. We are ready to help.