Michigan Property Tax Notices Are Coming— Key Deadlines and Potential Savings to Consider

Property tax notice season has arrived in Michigan, and for many businesses—especially those in the cannabis industry—this is an opportunity to pursue the possibility of tax liability reductions and correct misclassifications. Tax assessments will be arriving soon from local assessors, and taxpayers should take note of important deadlines and filing requirements necessary to pursue tax savings. In particular, owners of personal property face a critical February 20 deadline for filing exemptions.

Now is the time for cultivation, processing and manufacturing facilities to review assessments carefully and determine if your company is taking full advantage of available tax-saving opportunities. The Honigman team brings together attorneys with significant experience advising cannabis businesses with tax attorneys who focus their practice on pursuing property tax reductions to provide cutting edge property tax guidance to cannabis businesses.

For a detailed breakdown of key deadlines, property classifications, and exemption opportunities—including real estate and equipment used in cultivation and manufacturing—read on.

Real property – which is land, land improvements, and buildings – is valued by the assessor of the local city or township every year as of December 31^st of the prior year. For tax year 2025, real property is valued as of December 31, 2024. Assessors generally mail out a notice of assessment for each real property parcel in February. Taxpayers should closely review all the information on the notices of assessment received, and if they have questions about the values or other important information on the notice, they should consider consulting with a property tax attorney. In addition to reviewing the values, cannabis grow facilities should review the classification of their real property. If a property is being used predominantly for growing plants, the grow operator should pursue the “agricultural” classification for tax purposes. An appearance before the local Board of Review, which meets the second week of March, is required to seek a classification change from industrial or commercial to agricultural. Property classified agricultural is exempt from 18 mills of school operating tax which can be close to approximately 30% of the tax assessed, depending on the mills assessed by a particular jurisdiction. Honigman represents several grow operators currently pursuing the agricultural classification. All grow operators represented have been successful in securing decisions from their local circuit courts that their properties should be classified agricultural. Those decisions are currently being reviewed by the Michigan Court of Appeals.

Personal property includes furniture and fixtures; electronics; machinery and equipment; computer equipment; and some leasehold improvements. Owners of personal property often have a responsibility to submit a personal property filing with their local assessor by February 20 each year. There are several different exemptions that apply to cannabis businesses, and whether certain filings are required by February 20 depends on whether the taxpayer qualifies for exemptions. For small businesses, if the original acquisition cost of all the personal property owned by the taxpayer and its affiliates in a city or township is less than $180,000, the taxpayer’s personal property may qualify as exempt under the small business exemption. For grow operations, personal property used in agricultural operations should qualify for the agricultural exemption. For personal property predominantly used for production of cannabis products, an eligible manufacturing exemption should apply. What exemptions may apply to your property should be analyzed now so that the correct filings can be submitted by the February 20 deadline.

If you have any immediate questions or concerns, please reach out to a member of the Honigman Cannabis Team.