Real Estate Math

A Michigan property is assessed at $175,000 (SEV). With a millage rate of 35 mills and the homeowner claiming the PRE, what is the approximate school operating tax savings? (Assume 18 mills is the school operating rate.)

A$1,575
B$3,150✓ Correct
C$6,125
D$2,450

Explanation

The PRE exempts the principal residence from 18 mills of school operating taxes. Tax savings: $175,000 × 18/1,000 = $175,000 × 0.

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