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Home Heating Tax Credit

By Jadranko Tomic-Bobas, Managing Hotline Attorney

One thing Michiganders love most about living in the beautiful state of Michigan is the ability to experience all four seasons in their full glory. Sometimes, we even get to experience them all in one day. However, the drawback to this is that the winters can be bitter, miserable and even dangerously cold, especially for many low-income families and households who struggle to afford their heating bills during the winter. To help these households survive the coldest parts of the season, the state of Michigan has implemented what is called the Home Heating Credit. This tax credit is designed to help Michigan homeowners or renters who are low-income, disabled, receiving unemployment compensation or other qualified residents, pay for a portion of their heating expenses. The amount of credit that you are eligible to receive may vary from household to household, and eligible customers must meet guidelines based on income, exemptions, and heating costs.

To qualify for the credit, you must meet all of the requirements set out by the State of Michigan. The list of requirements includes that you occupy a Michigan homestead, which means your permanent residence. For the Home Heating Credit, you can only have one homestead and other properties that you own but rent out, second homes, cottages, and college or university operated student housing such as dorms and/or apartments are not considered homesteads in the State of Michigan, and therefore will not qualify for this credit. Additionally, you must own your home or be contracted to pay rent on the property to qualify. You also cannot be a full-time student who was claimed as a dependent on another person’s tax return, live in college or university housing for the entire year, or live in a licensed care facility for the entire year. The final requirement is an income-based requirement which varies depending on the number of exemptions you can claim. To find out if you qualify for this credit, you should contact a tax attorney or a qualified financial aid representative, or go the State of Michigan’s website on the Department of Treasury’s Michigan Taxes page.

In order to claim this credit, you must file a Home Heating Credit form (MI-1040CR-7). This may be the only form you may need to submit, or you may be asked to file a Michigan Individual Income Tax return along with the Home Heating Credit form. The deadline to submit these forms is September 30th. Once processed, your payment will come as a State of Michigan Energy Draft if you are responsible for paying your heating bills. This draft can only be used to pay heat bills and you can give it to your heat provider who will apply it to current and/or future heating bills.

To avoid delays in receiving your credit, ensure that you have the form in on time with your name and address correct and legible. Ensure that all of your personal information is correct including any information regarding dependents and that you have reported all total household resources from all sources in an annual amount. Be wary of mistakes when computing your credit, and ensure that all lines are filled out fully and accurately. All necessary forms and any additional information can be found on the State of Michigan’s Department of Treasury web page. There are also a number of special circumstances that you may be eligible for and to receive more information on these, or to get assistance in the filing process in general, seek advice from a qualified tax professional.

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