The bill amends the Michigan Business Tax Act by establishing a business income tax rate of 4.95% for all business activities occurring before January 1, 2025, and a significantly higher rate of 30.0% for activities starting on or after that date. It also introduces adjustments to the tax base calculations, including provisions for adding interest income, taxes on net income, and carrybacks of net operating losses, while detailing deductions for certain expenses and losses. Additionally, the bill outlines specific provisions for qualified affordable housing projects, including deductions related to the sale of residential rental units and the conditions for claiming these deductions.

Moreover, the bill modifies tax provisions for taxpayers with certificated credits, allowing them to elect to pay the tax imposed by this act in the tax year when the certificated credit can be claimed. It specifies that unitary business groups must file returns and pay taxes collectively, and once a taxpayer opts to pay under this act, they must continue until their certificated credit is fully utilized. The bill also clarifies conditions for taxpayers with certificated credits under the natural resources and environmental protection act and ensures that taxpayers can only claim credits for the current tax year. The enactment of this bill is contingent upon the passage of several other specified bills from the 103rd Legislature.

Statutes affected:
Substitute (H-1): 208.1201, 208.1500
House Introduced Bill: 208.1201, 208.1500
As Passed by the House: 208.1201, 208.1500