By Gloria M. Chon

Michigan taxpayers will no longer have to pre-pay the amount of taxes, penalties, and interest that the taxpayer disputes in order to appeal a tax assessment or decision before the Michigan Court of Claims.

Under current law, a taxpayer looking to appeal a tax assessment or adverse tax decision faces a fork in the road:  the taxpayer must decide whether to bring the case before the Michigan Tax Tribunal or the Michigan Court of Claims.  Below is a summary of the relevant requirements for each venue as well as the change in the law brought by Enrolled Senate Bill 100, recently signed by Governor Rick Snyder.

Tax Tribunal
(Property and non-property tax matters)
Court of Claims
(Non-property tax matters only)
Current Law
  • 35 days to bring claim.
  • Pre-payment of undisputed amount required.
  • 90 days to bring claim.
  • Pre-payment of undisputed and disputed amount, plus penalties and interest required.
New Law
  • 60 days to bring claim.
  • Pre-payment of undisputed amount required.
  • 90 days to bring claim
  • Pre-payment of undisputed amount required.

According to the Michigan House Fiscal Agency, these changes effectively remove the “pay-to-play” requirement of the Court of Claims, thereby making it easier for a taxpayer to bring a non-property tax matter before that court.  Prior to this change in law, a taxpayer may have been limited to the Tax Tribunal due to the pre-payment requirement of the Court of Claims, even though the taxpayer would have preferred to bring the claim before the Court of Claims.  (One reason a taxpayer may prefer the Court of Claims is because the Tax Tribunal is not bound by certain judicial rules.)

It is important to note that, in the event the taxpayer loses on a matter before the Court of Claims, the taxpayer will still be liable for the disputed amount, plus any penalties and interest, as if the disputed tax amount were delinquent.

The new law is expected to take effect in 2016.

For further information regarding these matters, please contact Ms. Chon at via email or 248.528.1111.