This bill amends the Income Tax Act of 1967 by modifying sections 623 and 815, which pertain to corporate income tax and flow-through entity tax, respectively. It establishes a corporate income tax rate of 6.0% on taxpayers with business activities in Michigan, while also detailing the adjustments to the corporate income tax base. Notably, the bill introduces provisions for tax years beginning on or after January 1, 2026, allowing deductions for grant money received from eligible grants aimed at broadband expansion, as well as expenses related to those grants. The definition of "eligible grant" encompasses various federal and state programs designed to enhance broadband access.

Additionally, the bill outlines the flow-through entity tax, which is imposed on positive business income after allocation or apportionment to the state. It includes similar adjustments to the business income tax base as those in the corporate income tax section, with specific provisions for deductions related to grants for broadband expansion. The bill also clarifies the treatment of income and expenses related to oil and gas production, and it specifies that taxpayers must only pay tax on the business income tax base allocable to individual members, excluding corporations and financial institutions. The enactment of this bill is contingent upon the passage of Senate Bill No. 209.

Statutes affected:
Senate Introduced Bill: 206.623, 206.815