I am buying a home on a land contract in Michigan,the contract holders have not paid the taxes or the insurance on the home as it is required it the contract,what can I do about this.

Does the contract specify any penalties if they don't?

Since you are the buyer I would send the sellers a certified letter stating that according the contract (cite the clause or paragraph) they are required to make these payments. If they do not pay in full upon receipt of this letter, then you will pay what's due and subtract the amounts from your payments.