Poverty Exemption at the March Board of Review: Late Filing, Household Income, and Conflict
At the March Board of Review in a township, Ms. Chen applies for a poverty exemption on her owner-occupied home. The local governing body has adopted poverty guidelines at 150% of the federal poverty guidelines, with a $30,000 asset limit excluding the homestead. Ms. Chen’s household consists of herself and two children. She reports $31,000 in wages, $4,800 in child support, and a bank balance of $8,000. Her boyfriend lives in the home and gives her $1,000 per month for household expenses, but he is not on the deed and did not file a tax return with her. The application is filed on the first day of the March board. The board’s local procedures say applications must be filed 10 days before the board meets, and the board’s chair wants to deny the application as late without a hearing. One board member is the boyfriend’s employer.
1. May the board deny the application solely because it was filed on the first day of the March board rather than 10 days earlier? Explain.
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The board should not deny solely on the 10-day local procedure without a hearing. The poverty exemption is heard by the board of review, and a local procedural rule cannot shorten the taxpayer’s opportunity to apply at the March board in a way that defeats the statutory process. An application filed on the first day of the March board is timely for that board’s consideration. The safer and more defensible course is to accept the application, review it, and adjourn if verification is needed. A denial without a hearing creates appeal risk and weakens the written record. The board may apply its local guidelines for documentation and verification, but it should not use a local deadline to refuse to hear a timely application.
2. How should the board determine household income and eligibility? Identify the relevant income and asset figures.
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The board must determine who is in the household and verify income and assets under the adopted guidelines. The boyfriend lives in the home and contributes $1,000 per month ($12,000 per year) to household expenses, so the board should include that contribution unless the guidelines clearly treat him as a non-household boarder. Including it gives:
- Wages: $31,000
- Child support: $4,800
- Boyfriend’s contribution: $12,000
- Total household income: $47,800
The 150% poverty guideline for a household of three is $38,730 (using the 2024 three-person guideline of $25,820 × 1.5). On those figures, the household is over the income limit and the application should be denied. If the boyfriend is excluded, income is $35,800 and the household is under the limit. Assets are $8,000, below the $30,000 limit, and the homestead is excluded. The board should request proof of the boyfriend’s income and household status, document the income calculation, and issue written findings rather than denying on the late-filing issue.
3. What should the board do about the member whose employer is the boyfriend, and what findings should the board issue?
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The member should disclose the relationship and abstain from the hearing and vote. A board member whose employer is the applicant’s boyfriend has an appearance of conflict and should not participate in the decision. If the remaining two members constitute a quorum, they may hear the matter and decide. If not, the board should adjourn and arrange for a qualified replacement or otherwise follow the township’s appointment process; it should not let the conflicted member vote merely to reach a quorum.
The written decision should state the household size, the income included and excluded, the asset total, the applicable poverty guideline, the board’s determination, and the taxpayer’s appeal rights to the Michigan Tax Tribunal. The board should also note that the application was accepted as timely and that the denial, if any, is based on the income calculation, not on the local 10-day rule.