The bill amends the Income Tax Act of 1967 to revise the definition of "taxable income" for individuals, introducing new deductions and clarifying existing provisions. Key insertions include the allowance for deductions related to compensation from wrongful imprisonment and specific deductions for disabled veterans concerning student loan discharges. The bill also updates eligibility criteria for retirement benefits from the Michigan National Guard and sets maximum allowable deductions for senior citizens, while eliminating outdated provisions related to oil and gas income. Additionally, it caps deductions for contributions to education savings accounts and ABLE accounts at $5,000 for single filers and $10,000 for joint filers, ensuring that the tax code reflects current demographic considerations.

Further amendments focus on deductions for first-time home buyer savings accounts and broadband expansion grants, allowing taxpayers to deduct contributions and interest earned on these accounts starting in 2022. The bill also adjusts personal exemptions based on the Consumer Price Index and modifies the treatment of retirement benefits, allowing for a percentage deduction based on birth year from 2023 to 2026. It includes provisions for corporate income tax and flow-through entity tax, specifying how income from non-electing flow-through entities is taxed and defining key terms related to the minerals severance tax. Overall, the bill aims to streamline the tax code, provide targeted relief, and promote savings and broadband expansion.

Statutes affected:
House Introduced Bill: 206.30
As Passed by the House: 206.30