Can I Claim Mobile Home Lot Rent on My Taxes in Michigan?

by Jay P. Whickson ; Updated July 27, 2017

If you're purchasing a mobile home, the interest you pay on the mobile home is tax deductible on your federal return. However, the lot rent isn't. In Michigan, there are several spots where paying a rent on land is tax deductible or gives a tax credit. Renters, such as those paying mobile home lot rent, receive tax credits because they pay property tax indirectly through the lot rent.

Federal Taxes

Since federal taxes offer no tax break for the renter, lot rent doesn't qualify either. However, in Michigan, as in every other state, the interest you pay on a mobile home that's your primary home or secondary home, such as a vacation property, is deductible if you itemize your deductions.

Homestead Property Tax Credit

If your income is less than $82,650, you may receive a tax credit based on the property tax paid by the landlord. To receive the credit, you need to fill out the Homestead Property Tax Credit Claim MI-1040CR form. You then deduct that amount from your Michigan income tax.

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Calculate the Credit

Those that rent a mobile home lot calculate the tax slightly differently than homeowners. At the time of publication, you deduct $3 a month from your lot rent, then multiply that amount times 12 and take 20 percent of that amount. Once you calculate it, you'll add the $3 a month -- $36 for the year -- to the amount you calculated. You also can claim 100 percent of any taxes you paid on an attached building.

List All Income

You also have to list all income. This includes non-taxable incomes such as Supplemental Security Income benefits, Social Security and veterans’ disability compensation. At the time of publication, you add the total income you receive and multiply that amount by 0.035. Subtract that amount from the tax credit you calculated in the previous step to find your tax credit.

Tax Credit or Refund

If you file a Michigan tax form MI-1040, you write the amount of your tax credit for lot rent under refundable credits and payments on your MI-1040 state income tax form -- it's on line 24 of the 2010 MI-1040. You have to include the MI-1040CR form you completed with your Michigan MI-1040. If you don't file a Michigan state tax form, simply file the Michigan Homestead Property Tax Credit Claim MI-1040CR complete with a routing number and checking or savings account number to receive the funds directly into your account.

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