Michigan Property Taxes
Taxes in Arrears — What It Means at Closing
Michigan bills property taxes twice a year — and at closing, the year gets split between buyer and seller. When taxes are paid in arrears, the seller is charged for the days they owned the home. Here's how it works and what it means for your closing numbers.
The Michigan Two-Bill System
Michigan Bills Property Taxes Twice a Year
Michigan property owners receive two separate tax bills each year — a summer bill and a winter bill — both prorated against the full calendar year (January 1 through December 31). Knowing when each bill is sent determines whether taxes are in advance or in arrears at your closing.
Summer tax (city)
- Covers
- January 1 – December 31
- Billed
- July 1
- Due
- September 14
The summer bill covers city taxes and is prorated against the full calendar year. It is billed July 1 and due September 14.
Winter tax (county/school)
- Covers
- January 1 – December 31
- Billed
- December 1
- Due
- February 14
The winter bill covers county and school taxes and is also prorated against the full calendar year. It is not billed until December 1 — after most closings have already occurred.
When Taxes Are Paid In Arrears
The Seller Pays Their Share at Closing
Taxes in arrears means the tax bill covers a period that has already passed — or is currently passing — but the bill hasn't been paid yet. The winter tax bill, for example, covers the full calendar year but isn't billed until December 1. A seller closing in October has owned the home for ten months of that period without ever receiving a bill.
At closing, the seller is charged their share of the unpaid taxes — one day at a time — for every day they owned the home during the calendar year. The buyer receives that credit and will pay the full bill when it arrives. This way, each party pays only for the days they actually owned the property.
The proration is calculated day-by-day using the total bill amount divided by the number of days in the calendar year (365 or 366 in a leap year). The seller's charge equals the per-diem rate multiplied by the number of days from January 1 through the closing date.
Proration Calculator
Michigan Tax Proration Calculator
Enter your two Michigan tax bills and your closing date. Both bills are prorated against the full calendar year — the calculator splits each day-by-day and shows who pays what at closing.
The summer bill (city taxes) is prorated January 1 – December 31.
The winter bill (county and school taxes) is prorated January 1 – December 31.
Your Proration
- Per day
- $6.58
- Seller days
- 342
- Buyer days
- 23
- Seller credit
- $151.23
- Per day
- $4.93
- Seller days
- 342
- Buyer days
- 23
- Seller charge
- $1,686.58
In Plain English — Who Pays What at Closing
- The summer (city) tax is paid — taxes in advance. It covers January 1 - December 31, but the buyer owns the home for the last 23 days of that period (December 9 - December 31). The buyer reimburses you $151.23 at closing ($6.58 per day × 23 days).
- The winter (county/school) tax is unpaid — taxes in arrears. You owned the home for 342 days it covers (January 1 - December 8), so you are charged $1,686.58 at closing ($4.93 per day × 342 days). The buyer pays the rest when the bill arrives.
The seller is charged this net amount at closing for taxes owed but not yet paid.
This calculator is an estimate for planning purposes. Both bills are prorated against the full calendar year (January 1 – December 31). Your final proration is computed by the closing agent from the actual tax bills at closing.
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Tax proration questions we hear at the closing table
What does tax proration mean at closing?
Tax proration is the day-by-day split of the year's property taxes between buyer and seller at closing. Both the summer and winter bills are prorated against the full calendar year (January 1 – December 31). The seller is responsible for taxes through the closing date; the buyer is responsible for everything after.
Are Michigan taxes always in arrears at closing?
Not always — it depends on the timing of the closing relative to the billing cycle. When a bill has already been paid and covers days after closing, taxes are in advance and the buyer reimburses the seller. When a bill hasn't been paid yet for days the seller already owned the home, taxes are in arrears and the seller is charged at closing.
What happens if the bill hasn't been sent yet?
The seller is charged their share at closing — even though the bill hasn't arrived yet. That charge goes to the buyer as a credit, and the buyer pays the full bill when it comes due. Neither party pays more than their fair share.
Does every Michigan city split taxes the same way?
Yes. Municipalities set their own billing dates and millage splits, and some taxes are billed on separate cycles. The figures here use the standard full-year convention and your closing agent computes the final proration from the actual bills.
Questions About Your Closing Numbers?
Our closers review every proration line by line before your closing. Call, stop by one of our Michigan offices, or open title online and we'll walk your figures with you.