"Thousands of summer cottages and second homes in Michigan have lost a valuable tax break in recent years amid state Treasury Department audits aimed at cracking down on improper exemptions.
...Removing the tax breaks is having an unintended consequence in Detroit, he said.
...“It seems unfair to dun people who have, in many instances, worked hard to obtain that second home or cottage,” said Michael LaFaive, director of fiscal policy for the Mackinac Center for Public Policy. “I don’t think many of them were born with silver spoons in their mouths."
...The experiences of several property owners atop a bluff in New Era also illustrate the impact the state’s attempt to boost tax revenue has had on generations of family members.
Until recently, Cathy Houlihan and four siblings were second-generation owners of a blue cottage, built by hand in the 1970s by their father, 100 steps above the Lake Michigan shore.
...Her mother lived in the cottage year-round and received the tax break.
In 2013, the year the widow died, property taxes totaled $2,552.
The state audit removed the tax break in 2014 since none of the siblings lived there full time.
The move sent property taxes soaring 273 percent – to $9,509 a year.
After losing the exemption, and facing the heftier tax bill, two brothers sold their stakes to the sisters.
Retaining the $381,000 cottage has been a financial burden.
“It’s been a hardship and we’ve made some major adjustments throughout the family to make this work,” Houlihan said...”
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