A Home-Heating Credit (HHC) is designed to help low-income families with heating expenses. The HHC provides eligible households a refund based on the heating costs paid during the year. Whether you own the home or rent it, you may be entitled to the credit. The amount you receive is also dependent on the number of people living in your home.
The federal Low Income Home Energy Assistance Program (LIHEAP) provides funding for the credit, as well as other energy assistance programs offered throughout the country. The application process may differ slightly, but in all states the LIHEAP is responsible for reviewing applications and determining eligibility. Although states offer similar credits for heating and energy expenses, Michigan features the HHC per se.
If your claim is approved, you will receive an energy draft. The draft must be submitted directly to the utility supply company to receive a credit on your heating bill. If your heating costs are included in your monthly rent, you will receive a check instead. The amount of the check may be reduced by 50 percent of the original claim amount. While other states require you to apply at your local LIHEAP office, Michigan allows residents to apply online.
To qualify for the HHC credit, the home you own or rent must by your primary residence. You will need to fall within the income guidelines based on the number of exemptions you declare. At the time of publication, the income limit for a resident claiming one exemption is $11,929 a year. If you claim two exemptions, you can have an income of up to $16,043. An exemption is yourself, your spouse and any other dependents. Additional exemptions are offered to seniors, disabled customers and those who receive at least half their income from unemployment compensation.
Preparing to File
The Michigan HHC credit is typically claimed on residents' state income tax return. However, it can be filed separately as long as it is received by the annual deadline of September 30th for the prior year. When preparing to file your HHC, you will need to gather the necessary documents and information needed to complete the Michigan Home Heating Credit Claim Form MI-1040CR-7. The form requires you to provide financial information for all household members. You will be asked to list your annual income, including income from unearned sources such as child support. Social Security numbers for each person living in the home are also required.
As stated, you can file electronically in Michigan to eliminate processing delays. The Michigan Department of Treasury provides links to software companies that offer free e-file services for filing state income tax and credit claims. After 14 days, you can check the status of your e-filed return by using the Michigan Department of Treasury website's "Check My Income Tax Info" feature. If you need help filing the claim, you can contact your nearest Community Action Agency for a referral to a volunteer tax preparation service.