Regarding Michigan's taxable value uncapping rules under Proposal A, which of the following transfers would most likely trigger an uncapping of the taxable value, EXCEPT in circumstances where a specific statutory exemption applies?
Correct Answer
D) A transfer of the property from one spouse to the other spouse as part of a divorce settlement
Under Michigan law, a transfer of property between spouses — including as part of a divorce settlement — is specifically exempt from uncapping under Proposal A. This means the taxable value does not reset to the SEV when a property is transferred between spouses, regardless of whether the transfer is due to divorce, estate planning, or other reasons. This spousal transfer exemption is one of the narrow statutory exceptions to the general uncapping rule. The question asks which transfer would NOT trigger uncapping (i.e., which is exempt), and the spousal transfer is the correct answer.
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Related Topics & Key Terms
Key Terms:
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