The proposed bill amends the Income Tax Act of 1967 by adding a new section, Sec. 279, which introduces tax credits for retail dealers and biodiesel producers in Michigan. For tax years from January 1, 2025, to December 31, 2030, retail dealers can claim a credit based on the percentage of biodiesel in the fuel they sell, with credits of $0.02, $0.05, and $0.07 per gallon for blends containing 6.0% to 9.0%, 10% to 19%, and 20% or more biodiesel, respectively. Additionally, biodiesel producers can claim a credit of $0.02 per gallon for biodiesel produced in the state, with an aggregate cap of $2 million on credits claimed under this section and another related section.

The bill also establishes a pro rata distribution method for credits if the total claims exceed set caps, which are $16 million for retail dealer credits and $2 million for biodiesel producer credits. Furthermore, it allows taxpayers who are members of flow-through entities to claim credits based on their share of business income. If the credit exceeds the taxpayer's liability, the excess will be refunded. Definitions for key terms such as "biodiesel," "biodiesel blend," and "retail dealer" are also included to clarify the bill's provisions. The enactment of this bill is contingent upon the passage of another specified House Bill.

Statutes affected:
House Introduced Bill: 206.1, 206.847