January 27, 2005, Introduced by Rep. Accavitti and referred to the Committee on Tax Policy.
A bill to amend 1975 PA 228, entitled
"Single business tax act,"
(MCL 208.1 to 208.145) by adding section 35c.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 35c. (1) For tax years that begin after December 31,
2005, a qualified taxpayer may claim a credit against the tax
imposed by this act equal to 10% of the job skills training
expenses paid by the qualified taxpayer in the tax year.
(2) If the credit allowed under this section exceeds the tax
liability of the taxpayer under this act for the tax year, that
portion of the credit that exceeds the tax liability shall not be
refunded but may be carried forward until the credit is used up.
(3) A qualified taxpayer that claims a credit under this
section shall submit proof of the expenditures used to calculate
the credit under this section and that those expenditures are for
certified job skills training programs with its annual return
required under this act on which the credit is claimed.
(4) A qualified taxpayer that is a flow-through entity may be
assigned all or a portion of the credit allowed under this section
to 1 or more of its members. An assignment under this section shall
be based on the percentage of the member's distributive share of
the income of the flow-through entity or based on an alternative
method approved by the department. A credit assignment under this
subsection is irrevocable. A qualified taxpayer may claim a portion
of a credit and assign the remaining credit amount. A member that
is an assignee shall not subsequently assign a credit or any
portion of a credit assigned under this subsection. The credit
assignment under this subsection shall be made on a form prescribed
by the department. The qualified taxpayer shall send a copy of the
completed assignment form to the department in the tax year in
which the assignment is made. A member who is an assignee shall
attach a copy of the completed assignment form to its annual return
required under this act, for the tax year in which the assignment
is made and the assignee first claims a credit, which shall be the
same tax year.
(5) As used in this section:
(a) "Flow-through entity" means an S corporation, partnership,
limited partnership, limited liability partnership, or limited
liability company. Flow-through entity does not include a publicly
traded partnership as that term is defined in section 7704 of the
internal revenue code that has equity securities registered with
the securities and exchange commission under section 12 of title I
of the securities exchange act of 1934, 15 USC 781.
(b) "Highly compensated employees" means that term as defined
in section 414(q) of the internal revenue code.
(c) "Job skills training expenses" means expenses, not
including indirect costs such as wages, salaries, and fringe
benefits paid to employees while the employees attend certified job
skills training programs, that are incurred by a qualified taxpayer
for any of the following:
(i) Sponsoring or cosponsoring a certified job skills training
program that the qualified taxpayer provides for its employees, to
the extent the expenses are incurred to provide training to its
employees and not to other program participants.
(ii) Reimbursing an employee for participation in a certified
job skills training program not sponsored or cosponsored by the
qualified taxpayer.
(d) "Job skills training program" means a job skills training
program certified by the department of labor and economic growth
under the job skills training program certification act designed to
do all of the following:
(i) Develop, enhance, or upgrade basic workforce skills of an
employee including literacy, communication skills, computational
skills, and other transferable workforce skills.
(ii) Develop, enhance, or upgrade advanced, specialized, or
industry specific skills of an employee that are directly related
to the employee's job or career.
(e) "Member of a flow-through entity" means a shareholder of
an S corporation, a partner in a partnership or limited
partnership, or a member of a limited liability company.
(f) "Qualified taxpayer" means a taxpayer that pays an average
hourly wage to its employees, other than highly compensated
employees, that exceeds 150% of the federal minimum wage.
Enacting section 1. This amendatory act does not take effect
unless all of the following bills of the 93rd Legislature are
enacted into law:
(a) Senate Bill No.____ or House Bill No. 4010(request no.
00656'05).
(b) Senate Bill No.____ or House Bill No. 4011(request no.
00657'05).