Not only do developers benefit by locating in a renaissance zone, residents living there pay virtually no state or local taxes! That’s right: retire to a luxury condo and pay no property tax and no state or local income tax.
And make no mistake: Muskegon’s renaissance zones are located in the heart of an active, emerging downtown close to the waterfront, museums, and other cultural/entertainment amenities. Many of these condos have spectacular water views.
Here are the official details on renaissance zones from the State of Michigan and City of Muskegon:
Residential Tax Benefits
Most state and local taxes for individuals are abated in the Renaissance Zones. The tax benefits are phased out at 25% increments during the zone’s final three years of existence. Property owners are still responsible for property taxes levied to pay for local bonded indebtedness, school sinking funds, and special assessments. The following state and local taxes are abated for businesses located in a Renaissance Zone:
Local Real Property Taxes – General property taxes on land and homes are nearly 100% abated. Personal Property – Personal property owned by individuals is 100% exempt under Michigan’s property tax system. (This applies only to businesses since residential owners have no personal property tax.) 6-mill State Education Tax (SET) – The state property tax levy for schools is 100% abated. This amount is included in your local property tax bill. State Personal Income Tax – The state’s personal income tax rate is 4.35% in 2008 and is scheduled to decline to 3.9% by 2016. Individuals living in a Renaissance Zone are exempt from paying the state personal income tax. Local Income Tax – City personal income taxes, if applicable in the zone, are 100% abated.