HOUSE BILL NO. 5292

November 13, 2025, Introduced by Reps. Tisdel and Lightner and referred to Committee on Finance.

"Income tax act of 1967,"

by amending sections 605 and 680 (MCL 206.605 and 206.680), section 605 as amended by 2011 PA 307 and section 680 as amended by 2019 PA 92, and by adding section 670; and to repeal acts and parts of acts.

the people of the state of michigan enact:

Sec. 605. (1) "Certificated credit" means either of the following:

(a) A credit for which a preapproval letter has been issued to a qualified taxpayer under section 437 of former 2007 PA 36 before January 1, 2012 to the extent the credit has not been fully claimed or paid prior to January 1, 2026.

(b) A credit or voucher certificate for which a taxpayer or a qualified taxpayer has entered into an agreement with the Michigan economic growth authority under section 430, 431, 431a, 431b, 431c, 432, 434, or 450 of former 2007 PA 36 before January 1, 2012 to the extent the credit or voucher certificate has not been fully claimed or paid prior to January 1, 2026.

(2) (1) "Corporation" means a person that is required or has elected to file as a C corporation as defined under section 1361(a)(2) and section 7701(a)(3) of the internal revenue code. Corporation does not include an insurance company or a financial institution.

(3) (2) "Department" means the department of treasury.

(4) (3) "Employee" means an employee as defined in section 3401(c) of the internal revenue code. A person from whom an employer is required to withhold for federal income tax purposes is prima facie considered an employee.

(5) (4) "Employer" means an employer as defined in section 3401(d) of the internal revenue code. A person required to withhold for federal income tax purposes is prima facie considered an employer.

Sec. 670. (1) Except as otherwise provided under this section, for tax years beginning on and after January 1, 2026 and before January 1, 2036, a taxpayer with a certificated credit may claim the remaining amount of that certificated credit against the taxpayer's tax liability under this part. To the extent possible, the credit allowed under this section must be claimed in equal installments over the next 10 years, beginning with the 2026 tax year. A taxpayer that does not, as determined by the department, maintain at least 95% of the number of full-time jobs that the taxpayer had in this state on September 30, 2025 in any tax year is not eligible to claim the credit under this section for that tax year or in any subsequent tax year. The department may require the taxpayer to submit reasonable proof of the number of full-time jobs maintained in this state each tax year.

(2) If the credit allowed under this section exceeds the tax liability of the taxpayer for the tax year, that portion of the credit that exceeds the tax liability must be refunded.

(3) As used in this section, "full-time job" means a job performed for 35 hours or more each week by an individual whose income and Social Security taxes are withheld by 1 or more of the following:

(a) The taxpayer.

(b) An employee leasing company.

Sec. 680. (1) Notwithstanding any other provision of this part, except as otherwise provided in subsection (2) for a certificated credit under section 435 or 437 of the Michigan business tax act, former 2007 PA 36, MCL 208.1435 and 208.1437, or in subsection (5) for a certificated credit under section 431 of the Michigan business tax act, former 2007 PA 36, MCL 208.1431, a taxpayer that has been approved to receive, has received, or has been assigned a certificated credit that has not been fully claimed or paid prior to January 1, 2012 may, for the taxpayer's first tax year ending after December 31, 2011 only, elect to file a return and pay the tax imposed by the Michigan business tax act, former 2007 PA 36, MCL 208.1101 to 208.1601, in lieu of the tax imposed by this part. An election under this subsection shall continue for the period prescribed in section 500(1) of the Michigan business tax act, 2007 PA 36, MCL 208.1500.through December 31, 2025.

(2) A taxpayer with a certificated credit under section 435 or 437 of the Michigan business tax act, former 2007 PA 36, MCL 208.1435 and 208.1437, which certificated credit may be claimed in a tax year ending after December 31, 2011 may elect to pay the tax imposed by the Michigan business tax act, former 2007 PA 36, MCL 208.1101 to 208.1601, in the tax year in which that certificated credit or any unused carryforward may be claimed in lieu of the tax imposed by this part.

(3) A taxpayer that is a member of a unitary business group and that has a certificated credit under sections 431 and 434(2) and (5) of the Michigan business tax act, former 2007 PA 36, MCL 208.1431 and 208.1434, is not required to file a combined return as a unitary business group and may elect to file a separate return and pay the tax, if any, under the Michigan business tax act, former 2007 PA 36. , MCL 208.1101 to 208.1601.

(4) A taxpayer that elects to pay the tax imposed by the Michigan business tax act, former 2007 PA 36, MCL 208.1101 to 208.1601, under this section is not required to file an annual return under this part.

(5) A taxpayer that acquires, pursuant to the modification of an existing written agreement approved by a resolution of the Michigan strategic fund board on November 27, 2018 and the subsequent transfer of that written agreement, a certificated credit authorized by the Michigan economic growth authority in 2004 under section 431 of the Michigan business tax act, former 2007 PA 36, MCL 208.1431, may, for the first tax year ending after October 1, 2018 only, elect to file the return and pay the tax imposed by the Michigan business tax act, former 2007 PA 36, MCL 208.1101 to 208.1601, in lieu of the tax imposed by this part as long as the Michigan economic growth authority or its successor determines that the modification and subsequent transfer of that credit reduces the total amount of the credit. However, if the first tax year ending after October 1, 2018 ends before the effective date of the amendatory act that added this subsection October 10, 2019 and the taxpayer has already filed a return for that tax year under this part, then the taxpayer may, if within the statute of limitations period prescribed under section 27a of 1941 PA 122, MCL 205.27a, elect under this subsection to file the return and pay the tax imposed by the Michigan business tax act, former 2007 PA 36, MCL 208.1101 to 208.1601, for that tax year by filing the necessary amended return under this part and filing an original return as provided under section 505 of the Michigan business tax act, former 2007 PA 36. , MCL 208.1505. An election under this subsection shall continue for the period prescribed in section 500 of the Michigan business tax act, 2007 PA 36, MCL 208.1500.through December 31, 2025.

(6) As used in this section, "certificated credit" means that term as defined in section 107 of the Michigan business tax act, former 2007 PA 36. , MCL 208.1107.

Enacting section 1. The Michigan business tax act, 2007 PA 36, MCL 208.1101 to 208.1519, is repealed effective for tax years that begin after December 31, 2025.

Enacting section 2. This amendatory act does not take effect unless House Bill No. 5293 (request no. H05227'25) of the 103rd Legislature is enacted into law.