What is the Modified Business Tax? The modified business tax covers total gross wages less employee health care benefits paid by the employer. Total gross wages are the total amount of all gross wages and reported tips paid for a calendar quarter.
Do I need to pay Michigan Business Tax?
Michigan recognizes the federal S election, and Michigan S corporations are not required to pay corporate income tax to the state.
When did the MBT go into effect in Michigan?
The MBT replaces the Single Business Tax, effective January 1, 2008. On December 4, 2007, Governor Jennifer M. Granholm signed Public Act 145 of 2007 amending the MBT. Although the primary purpose of PA 145 was to institute an MBT surcharge, PA 145 also makes some additional changes, which are detailed in the link below.
When did the Michigan Business Tax go into effect?
The Michigan Business Tax (MBT), which was signed into law by Governor Jennifer M. Granholm July 12, 2007, imposes a 4.95% business income tax and a modified gross receipts tax at the rate of 0.8%. Insurance companies and financial institutions pay alternate taxes (see below). The MBT replaces the Single Business Tax, effective January 1, 2008.
What are the filing requirements for the Michigan MBT?
See 2011 MBT Instruction Booklet for Standard Taxpayers (Form 4600) and MBT FAQs A40 and A41 for more information. The law does not require the filing of the MBT return by a taxpayer whose gross receipts apportioned or allocated to Michigan are less than $350,000.
What happens when you file a MBT return?
If a taxpayer files an MBT return and claims a certificated credit, the taxpayer makes the election to file and pay under the MBT until the certificated credit and any carryforward of that credit are exhausted. The MBT election enables a taxpayer with certificated MBT credits to continue using those credits once the CIT is in place.
