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Michigan Property Tax Credit for Senior Living Apartment question


Mrs. V.

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Client lives in an Adult Assisted Living facility. Pays $3200/month 'rent' that includes meals. Client received a notification from the facility that she paid $39264 in 'rent' for 2019.

 Client also received a notification from the facility that  her portion of the 2019 property tax is $1598.

For purposes of the Mi-1040-CR, I believe I use the $1598 figure to calculate her property tax credit, and use Part 5 Alternate Housing section of the form to calculate her credit.

Previous preparer  used BOTH the 'rent' AND the assigned portion of property tax to calculate her credit in previous years. 

Am I missing something here? Or do I get to be the one to tell the client she will only receive a small credit? 

The instructions are not clear (but I think I am correct:

Should a resident of an adult care facility use their share of their property taxes or their rent to compute a credit?

You must base your claim on the portion of your monthly payment that constitutes rent.  Do not include other services.  When you pay in one fee, determine your portion of the property taxes that can be claimed for credit based on square footage, or divide property taxes by the number of residents from whom the home is licensed to care.  This information may be obtained from your housing facility. 

Note: If you calculate the credit using rent paid, you must receive either a monthly statement from the landlord that separately itemizes rent, food, services, and other items. Or, you must obtain a letter from your landlord that states the portion of the monthly payment that constitutes rent. You may be required to produce a copy of the landlord's documentation to substantiate the claim. 

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