Impose 3% Late Penalty on Property Taxes

Townships May Choose to Impose a 3% Late Penalty Charge on Property Taxes 

MCL 211.44(3) authorizes townships to impose a 3% late penalty charge on taxes paid after February 14 and before March 1. The 3% late penalty is collected only on late payments made between February 14 and March 1; the township does not continue to apply the penalty to late payments received by the township after the last day of February (the county applies applicable property tax administration fees and interest starting March 1).  

The township retains the 3% penalty on late winter taxes. If a township collects the State Education Tax (SET) only in the summer, the township must forward any 3% penalty amounts on late ET payments to the state. If a township collects the SET and other taxes in the summer, the township must forward that portion of any 3% penalty amounts collected on the SET portion of the summer collection to the state. (MCL 211.905b(10) 

The 3% penalty is not imposed on deferred summer taxes paid before February 15. 

A township is not required to impose the 3% penalty, but if it wishes to do so, the township board must adopt a resolution before it can impose the charge.  

Sample Resolution to Impose 3% Late Penalty Charge on Property Tax Collections 

WHEREAS, The Township of ____________, __________ County, Michigan is responsible for assessing ad valorem property taxes, collecting property tax levies, and handling review and appeal matters arising therefrom, and

WHEREAS, PA 206 of 1893, MCL 211.44(3), provides for imposition of a late penalty charge equal to 3% of the tax on all taxes paid after February 14 and before March 1, and,

WHEREAS, it is the desire of this Township Board to encourage the timely payment of taxes,

NOW, THEREFORE, BE IT HEREBY RESOLVED by the Township Board of ____________ Township that: The Township Board does hereby approve and authorize the imposition of a late penalty charge equal to 3% of the tax on all taxes paid after February 14 and before March 1.

Option 1: Places a specific limit on the number of years you will impose the fee: This resolution shall apply to the property tax levy that shall become a lien in 20__, and shall continue in full force and effect for the year of 20___.

OR

Option 2: Does not require the board to act again unless they wish to stop imposing the PTAF: This resolution shall apply to all property tax levies that shall become due in 20__ or any year thereafter and this resolution shall continue in full force and effect unless and until revoked or rescinded by resolution of ___________ Township Board.

Motion made by ___________________.   

Seconded by ______________________.

Upon roll call vote the following voted:  

"Aye": ________________________  

(list names of members voting "Aye")                  

"No": _________________________        
 (list names of members voting "No")
 

The Supervisor declared the resolution adopted.

______________________________
(clerk’s name), Clerk