SENATE BILL No. 807

 

 

November 9, 2011, Introduced by Senator HILDENBRAND and referred to the Committee on Finance.

 

 

 

     A bill to amend 1967 PA 281, entitled

 

"Income tax act of 1967,"

 

by amending section 661 (MCL 206.661), as amended by 2011 PA 191.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 661. (1) Except as otherwise provided in this part, the

 

tax base established under this part shall be apportioned in

 

accordance with this chapter.

 

     (2) The tax base of a taxpayer whose business activities are

 

confined solely to this state shall be allocated to this state. The

 

tax base of a taxpayer whose business activities are subject to tax

 

both within and outside of this state shall be apportioned to this

 

state by multiplying the tax base by the sales factor calculated

 

under section 663. For a taxpayer that has a direct, or indirect

 

through 1 or more other flow-through entities, ownership interest

 


or beneficial interest in a flow-through entity, the taxpayer's

 

business income that is directly attributable to the business

 

activity of the flow-through entity shall be apportioned to this

 

state using an apportionment factor determined under section 663

 

based on the business activity of the flow-through entity unless

 

the flow-through entity is unitary with the taxpayer for

 

apportionment purposes as provided under section 663.

 

     (3) A taxpayer is subject to tax in another state in either of

 

the following circumstances:

 

     (a) The taxpayer is subject to a business privilege tax, a net

 

income tax, a franchise tax measured by net income, a franchise tax

 

for the privilege of doing business, or a corporate stock tax.

 

     (b) That state has jurisdiction to subject the taxpayer to 1

 

or more of the taxes listed in subdivision (a) regardless of

 

whether that state does or does not subject the taxpayer to that

 

tax.

 

     Enacting section 1. This amendatory act takes effect January

 

1, 2012.