Bill Text: MI HB4370 | 2015-2016 | 98th Legislature | Engrossed
Bill Title: Individual income tax; property tax credit; transportation earmark, property tax credit caps, and credit amount; provide for and increase. Amends secs. 520 & 522 of 1967 PA 281 (MCL 206.520 & 206.522) & adds sec. 51d. TIE BAR WITH: HB 4614'15, HB 4616'15, HB 4736'15, HB 4737'15, HB 4738'15, SB 0414'15
Spectrum: Partisan Bill (Republican 10-0)
Status: (Passed) 2015-11-10 - Assigned Pa 179'15 [HB4370 Detail]
Download: Michigan-2015-HB4370-Engrossed.html
HB-4370, As Passed Senate, November 3, 2015
SENATE SUBSTITUTE FOR
HOUSE BILL NO. 4370
A bill to amend 1967 PA 281, entitled
"Income tax act of 1967,"
by amending sections 520 and 522 (MCL 206.520 and 206.522), section
520 as amended by 2011 PA 273 and section 522 as amended by 2013 PA
206, and by adding section 51d.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
1 Sec. 51d. In addition to the distribution under section 51(2),
2 the following amounts of revenue collected from the tax levied
3 under section 51 shall be deposited into the state treasury to the
4 credit of the Michigan transportation fund created in section 10 of
5 1951 PA 51, MCL 247.660, and disbursed as provided in section
6 10(1)(k) of 1951 PA 51, MCL 247.660:
7 (a) Beginning October 1, 2018 through September 30, 2019,
8 $150,000,000.00.
1 (b) Beginning October 1, 2019 through September 30, 2020,
2 $325,000,000.00.
3 (c) Beginning October 1, 2020 and each October 1 thereafter,
4 $600,000,000.00.
5 Sec. 520. (1) Subject to the limitations and the definitions
6 in this chapter, a claimant may claim against the tax due under
7 this part for the tax year a credit for the property taxes on the
8 taxpayer's homestead deductible for federal income tax purposes
9 pursuant to section 164 of the internal revenue code, or that would
10 have been deductible if the claimant had not elected the zero
11 bracket amount or if the claimant had been subject to the federal
12 income tax. The property taxes used for the credit computation
13 shall not be greater than the amount levied for 1 tax year. An
14 owner is not eligible for a credit under this section if the
15 taxable value of his or her homestead excluding the portion of a
16 parcel of real property that is unoccupied and classified as
17 agricultural for ad valorem tax purposes in the year for which the
18 credit is claimed is greater than $135,000.00 through the 2021 tax
19 year. Beginning with the 2021 tax year and each tax year after
20 2021, the taxable value cap under this subsection for the
21 immediately preceding tax year shall be adjusted by the percentage
22 increase in the United States consumer price index for the
23 immediately preceding calendar year and rounded to the nearest
24 $100.00 increment. The department shall annualize the amount in
25 this subsection as necessary. As used in this subsection, "taxable
26 value" means that value determined under section 27a of the general
27 property tax act, 1893 PA 206, MCL 211.27a.
1 (2) A person who rents or leases a homestead may claim a
2 similar credit computed under this section and section 522 based
3 upon 17% of the gross rent paid for tax years before the 1994 tax
4 year, or 20% of the gross
rent paid for tax years after the 1993
5 tax year. before the
2018 tax year or 23% of the gross rent paid
6 for tax years after the 2017 tax year. A person who rents or leases
7 a homestead subject to a service charge in lieu of ad valorem taxes
8 as provided by section 15a of the state housing development
9 authority act of 1966, 1966 PA 346, MCL 125.1415a, may claim a
10 similar credit computed under this section and section 522 based
11 upon 10% of the gross rent paid.
12 (3) If the credit claimed under this section and section 522
13 exceeds the tax liability for the tax year or if there is no tax
14 liability for the tax year, the amount of the claim not used as an
15 offset against the tax liability shall, after examination and
16 review, be approved for payment, without interest, to the claimant.
17 In determining the amount of the payment under this subsection,
18 withholdings and other credits shall be used first to offset any
19 tax liabilities.
20 (4) If the homestead is an integral part of a multipurpose or
21 multidwelling building that is federally aided housing or state
22 aided housing, a claimant who is a senior citizen entitled to a
23 payment under subsection (2) may assign the right to that payment
24 to a mortgagor if the mortgagor reduces the rent charged and
25 collected on the claimant's homestead in an amount equal to the tax
26 credit payment provided in this chapter. The assignment of the
27 claim is valid only if the Michigan state housing development
1 authority, by affidavit, verifies that the claimant's rent has been
2 so reduced.
3 (5) Only the renter or lessee shall claim a credit on property
4 that is rented or leased as a homestead.
5 (6) A person who discriminates in the charging or collection
6 of rent on a homestead by increasing the rent charged or collected
7 because the renter or lessee claims and receives a credit or
8 payment under this chapter is guilty of a misdemeanor.
9 Discrimination against a renter who claims and receives the credit
10 under this section and section 522 by a reduction of the rent on
11 the homestead of a person who does not claim and receive the credit
12 is a misdemeanor. If discriminatory rents are charged or collected,
13 each charge or collection of the higher or lower payment is a
14 separate offense. Each acceptance of a payment of rent is a
15 separate offense.
16 (7) A person who received aid to families with dependent
17 children, state family assistance, or state disability assistance
18 pursuant to the social welfare act, 1939 PA 280, MCL 400.1 to
19 400.119b, in the tax year for which the person is filing a return
20 shall have a credit that is authorized and computed under this
21 section and section 522 reduced by an amount equal to the product
22 of the claimant's credit multiplied by the quotient of the sum of
23 the claimant's aid to families with dependent children, state
24 family assistance, and state disability assistance for the tax year
25 divided by the claimant's total household resources. The reduction
26 of credit shall not exceed the sum of the aid to families with
27 dependent children, state family assistance, and state disability
1 assistance for the tax year. For the purposes of this subsection,
2 aid to families with dependent children does not include child
3 support payments that offset or reduce payments made to the
4 claimant.
5 (8) A For
tax years before the 2018 tax year, a credit
under
6 subsection (1) or (2) shall be reduced by 10% for each claimant
7 whose total household resources exceed the minimum total household
8 resources amount of $41,000.00 and by an additional 10% for each
9 increment of $1,000.00 of total household resources in excess of
10 $41,000.00. Except as otherwise provided under this subsection, for
11 the 2018 tax year and each tax year after 2018, the minimum total
12 household resources amount is $51,000.00. For the 2018 tax year and
13 each tax year after 2018, a credit under subsection (1) or (2)
14 shall be reduced by 10% for each claimant whose total household
15 resources exceed the minimum total household resources amount
16 established under this subsection and by an additional 10% for each
17 increment of $1,000.00 of total household resources in excess of
18 the minimum total household resources amount for that tax year. For
19 the 2021 tax year and each tax year after 2021, the minimum total
20 household resources threshold amount established under this
21 subsection for the immediately preceding tax year shall be adjusted
22 by the percentage increase in the United States consumer price
23 index for the immediately preceding calendar year and rounded to
24 the nearest $100.00 increment.
25 (9) If the credit authorized and calculated under this section
26 and section 522 and adjusted under subsection (7) or (8) does not
27 provide to a senior citizen who rents or leases a homestead that
1 amount attributable to rent that constitutes more than 40% of the
2 total household resources of the senior citizen, the senior citizen
3 may claim a credit based upon the amount of total household
4 resources attributable to rent as provided by this section.
5 (10) A senior citizen whose gross rent paid for the tax year
6 is more than the percentage of total household resources specified
7 in subsection (9) for the respective tax year may claim a credit
8 for the amount of rent paid that constitutes more than the
9 percentage of the total household resources of the senior citizen
10 specified in subsection (9) and that was not provided to the senior
11 citizen by the credit computed pursuant to this section and section
12 522 and adjusted pursuant to subsection (7) or (8).
13 (11) The department may promulgate rules to implement
14 subsections (9) to (15) and may prescribe a table to allow a
15 claimant to determine the credit provided under this section and
16 section 522 in the instruction booklet that accompanies the
17 respective income tax or property tax credit forms used by
18 claimants.
19 (12) A senior citizen may claim the credit under subsections
20 (9) to (15) on the same form as the property tax credit permitted
21 by subsection (2). The department shall adjust the forms
22 accordingly.
23 (13) A senior citizen who moves to a different rented or
24 leased homestead shall determine, for 2 tax years after the move,
25 both his or her qualification to claim a credit under subsections
26 (9) to (15) and the amount of a credit under subsections (9) to
27 (15) on the basis of the annualized final monthly rental payment at
1 his or her previous homestead, if this annualized rental is less
2 than the senior citizen's actual annual rental payments.
3 (14) For a return of less than 12 months, the claim for a
4 credit under subsections (9) to (15) shall be reduced
5 proportionately.
6 (15) The For
tax years before the 2018 tax year, the total
7 credit allowed by this section and section 522 shall not exceed
8 $1,200.00 per year. Except as otherwise provided under this
9 subsection, for the 2018 tax year and each tax year after 2018, the
10 total credit allowed by this section and section 522 shall not
11 exceed $1,500.00 per year. Beginning with the 2021 tax year and
12 each tax year after 2021, the maximum amount of the credit allowed
13 under this section and section 522 for the immediately preceding
14 tax year shall be adjusted by the percentage increase in the United
15 States consumer price index for the immediately preceding calendar
16 year. The department shall round the amount to the nearest $100.00
17 increment.
18 (16) As used in this section, "United States consumer price
19 index" means the United States consumer price index for all urban
20 consumers as defined and reported by the United States Department
21 of Labor, Bureau of Labor Statistics.
22 Sec. 522. (1) The amount of a claim made pursuant to this
23 chapter shall be determined as follows:
24 (a) A claimant who is not a senior citizen is entitled to a
25 credit against the state income tax liability under this part equal
26 to 60% of the amount by which the property taxes on the homestead,
27 or the credit for rental of the homestead for the tax year, exceeds
1 3.5% of the claimant's total household resources for that tax
2 year.tax years before
the 2018 tax year or 3.2% of the claimant's
3 total household resources for the 2018 tax year and each tax year
4 after 2018.
5 (b) A claimant who is a senior citizen is entitled to a credit
6 against the state income tax liability under this part equal to the
7 following:
8 (i) For a claimant with total household resources of
9 $21,000.00 or less, an amount as determined in accordance with
10 subdivision (c).
11 (ii) For a claimant with total household resources of more
12 than $21,000.00 and less than or equal to $22,000.00, an amount
13 equal to 96% of the difference between the property taxes on the
14 homestead or the credit for rental of the homestead for the tax
15 year and 3.5% of total household resources for tax years before the
16 2018 tax year or 3.2% of total household resources for the 2018 tax
17 year and each tax year after 2018.
18 (iii) For a claimant with total household resources of more
19 than $22,000.00 and less than or equal to $23,000.00, an amount
20 equal to 92% of the difference between the property taxes on the
21 homestead or the credit for rental of the homestead for the tax
22 year and 3.5% of total household resources for tax years before the
23 2018 tax year or 3.2% of total household resources for the 2018 tax
24 year and each tax year after 2018.
25 (iv) For a claimant with total household resources of more
26 than $23,000.00 and less than or equal to $24,000.00, an amount
27 equal to 88% of the difference between the property taxes on the
1 homestead or the credit for rental of the homestead for the tax
2 year and 3.5% of total household resources for tax years before the
3 2018 tax year or 3.2% of total household resources for the 2018 tax
4 year and each tax year after 2018.
5 (v) For a claimant with total household resources of more than
6 $24,000.00 and less than or equal to $25,000.00, an amount equal to
7 84% of the difference between the property taxes on the homestead
8 or the credit for rental of the homestead for the tax year and 3.5%
9 of total household resources for tax years before the 2018 tax year
10 or 3.2% of total household resources for the 2018 tax year and each
11 tax year after 2018.
12 (vi) For a claimant with total household resources of more
13 than $25,000.00 and less than or equal to $26,000.00, an amount
14 equal to 80% of the difference between the property taxes on the
15 homestead or the credit for rental of the homestead for the tax
16 year and 3.5% of total household resources for tax years before the
17 2018 tax year or 3.2% of total household resources for the 2018 tax
18 year and each tax year after 2018.
19 (vii) For a claimant with total household resources of more
20 than $26,000.00 and less than or equal to $27,000.00, an amount
21 equal to 76% of the difference between the property taxes on the
22 homestead or the credit for rental of the homestead for the tax
23 year and 3.5% of total household resources for tax years before the
24 2018 tax year or 3.2% of total household resources for the 2018 tax
25 year and each tax year after 2018.
26 (viii) For a claimant with total household resources of more
27 than $27,000.00 and less than or equal to $28,000.00, an amount
1 equal to 72% of the difference between the property taxes on the
2 homestead or the credit for rental of the homestead for the tax
3 year and 3.5% of total household resources for tax years before the
4 2018 tax year or 3.2% of total household resources for the 2018 tax
5 year and each tax year after 2018.
6 (ix) For a claimant with total household resources of more
7 than $28,000.00 and less than or equal to $29,000.00, an amount
8 equal to 68% of the difference between the property taxes on the
9 homestead or the credit for rental of the homestead for the tax
10 year and 3.5% of total household resources for tax years before the
11 2018 tax year or 3.2% of total household resources for the 2018 tax
12 year and each tax year after 2018.
13 (x) For a claimant with total household resources of more than
14 $29,000.00 and less than or equal to $30,000.00, an amount equal to
15 64% of the difference between the property taxes on the homestead
16 or the credit for rental of the homestead for the tax year and 3.5%
17 of total household resources for tax years before the 2018 tax year
18 or 3.2% of total household resources for the 2018 tax year and each
19 tax year after 2018.
20 (xi) For a claimant with total household resources of more
21 than $30,000.00, an amount equal to 60% of the difference between
22 the property taxes on the homestead or the credit for rental of the
23 homestead for the tax year and 3.5% of total household resources
24 for tax years before the 2018 tax year or 3.2% of total household
25 resources for the 2018 tax year and each tax year after 2018.
26 (c) A claimant who is a senior citizen with total household
27 resources of $21,000.00 or less or a paraplegic, hemiplegic, or
1 quadriplegic and for tax years that begin after December 31, 1999,
2 a claimant who is totally and permanently disabled, deaf, or, for
3 tax years that begin after December 31, 2012, blind is entitled to
4 a credit against the state income tax liability for the amount by
5 which the property taxes on the homestead, the credit for rental of
6 the homestead, or a service charge in lieu of ad valorem taxes as
7 provided by section 15a of the state housing development authority
8 act of 1966, 1966 PA 346, MCL 125.1415a, for the tax year exceeds
9 the percentage of the claimant's total household resources for that
10 tax year computed as follows:
|
11 |
Total household resources Percentage |
|
12 |
Not over $3,000.00 .0% |
|
13 |
Over $3,000.00 but not over $4,000.00 1.0% |
|
14 |
Over $4,000.00 but not over $5,000.00 2.0% |
|
15 |
Over $5,000.00 but not over $6,000.00 3.0% |
|
16 |
Over $6,000.00 for tax years before |
|
17 |
the 2018 tax year 3.5% |
|
18 |
Over $6,000.00 for tax years after |
|
19 |
the 2017 tax year 3.2% |
20 (d) A claimant who is an eligible serviceperson, eligible
21 veteran, or eligible widow or widower is entitled to a credit
22 against the state income tax liability for a percentage of the
23 property taxes on the homestead for the tax year not in excess of
24 100% determined as follows:
25 (i) Divide the taxable value allowance specified in section
26 506 by the taxable value of the homestead or, if the eligible
1 serviceperson, eligible veteran, or eligible widow or widower
2 leases or rents a homestead, divide 17% of the total annual rent
3 paid for tax years before the 1994 tax year, or 20% of the total
4 annual rent paid for tax years after the 1993 before the 2018 tax
5 year or 23% of the total annual rent paid for tax years after the
6 2017 tax year on the property by the property tax rate on the
7 property.
8 (ii) Multiply the property taxes on the homestead by the
9 percentage computed in subparagraph (i).
10 (e) A claimant who is blind is entitled to a credit against
11 the state income tax liability for a percentage of the property
12 taxes on the homestead for the tax year determined as follows:
13 (i) If the taxable value of the homestead is $3,500.00 or
14 less, 100% of the property taxes.
15 (ii) If the taxable value of the homestead is more than
16 $3,500.00, the percentage that $3,500.00 bears to the taxable value
17 of the homestead.
18 (2) A person who is qualified to make a claim under more than
19 1 classification shall elect the classification under which the
20 claim is made.
21 (3) Only 1 claimant per household for a tax year is entitled
22 to the credit, unless both the husband and wife filing a joint
23 return are blind, then each shall be considered a claimant.
24 (4) As used in this section, "totally and permanently
25 disabled" means disability as defined in section 216 of title II of
26 the social security act, 42 USC 416.
27 (5) A senior citizen who has total household resources for the
1 tax year of $6,000.00 or less and who for 1973 received a senior
2 citizen homestead exemption under former section 7c of the general
3 property tax act, 1893 PA 206, may compute the credit against the
4 state income tax liability for a percentage of the property taxes
5 on the homestead for the tax year determined as follows:
6 (a) If the taxable value of the homestead is $2,500.00 or
7 less, 100% of the property taxes.
8 (b) If the taxable value of the homestead is more than
9 $2,500.00, the percentage that $2,500.00 bears to the taxable value
10 of the homestead.
11 (6) For a return of less than 12 months, the claim shall be
12 reduced proportionately.
13 (7) The department may prescribe tables that may be used to
14 determine the amount of the claim.
15 (8) The total credit allowed in this section for each year
16 after December 31, 1975 shall
not exceed $1,200.00 per year.the
17 amount determined under section 520.
18 (9) The total credit allowable under this part and part 361 of
19 the natural resources and environmental protection act, 1994 PA
20 451, MCL 324.36101 to 324.36117, shall not exceed the total
21 property tax due and payable by the claimant in that year. The
22 amount by which the credit exceeds the property tax due and payable
23 shall be deducted from the credit claimed under part 361 of the
24 natural resources and environmental protection act, 1994 PA 451,
25 MCL 324.36101 to 324.36117.
26 Enacting section 1. This amendatory act does not take effect
27 unless all of the following bills of the 98th Legislature are
1 enacted into law:
2 (a) Senate Bill No. 414.
3 (b) House Bill No. 4614.
4 (c) House Bill No. 4616.
5 (d) House Bill No. 4736.
6 (e) House Bill No. 4737.
7 (f) House Bill No. 4738.
