HB-5496, As Passed House, December 6, 2007
November 28, 2007, Introduced by Rep. Gaffney and referred to the Committee on Tax Policy.
A bill to amend 1953 PA 189, entitled
"An act to provide for the taxation of lessees and users of tax-
exempt property,"
by amending section 1a (MCL 211.181a), as added by 2004 PA 324.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1a. (1) Notwithstanding the tax day provided in section 2
of the general property tax act, 1893 PA 206, MCL 211.2, and except
as limited in subsection (5) and otherwise provided in subsection
(7), for taxes levied after December 31, 2004, real and personal
property of a qualified start-up business is exempt from taxes
levied under this act for each tax year in which all of the
following occur:
(a) The qualified start-up business applies for the exemption
as provided in subsection (2) or (3).
(b) The governing body of the local tax collecting unit adopts
a resolution approving the exemption as provided in subsection (4).
(2) Except as otherwise provided in subsection (3), a
qualified start-up business may claim the exemption under this
section by filing an affidavit on or before May 1 in each tax year
with the assessor of the local tax collecting unit. The affidavit
shall be in a form prescribed by the state tax commission. The
affidavit shall state that the qualified start-up business was
eligible for and claimed the qualified start-up business credit
under section 31a of the single business tax act, 1975 PA 228, MCL
208.31a, or section 415 of the Michigan business tax act, 2007 PA
36, MCL 208.1415, for the applicant's last tax year ending before
May 1. The affidavit shall include all of the following:
(a) A copy of the qualified start-up business's annual return
filed under the single business tax act, 1975 PA 228, MCL 208.1 to
208.145, or the Michigan business tax act, 2007 PA 36, MCL 208.1101
to 208.1601, in which the qualified start-up business claimed the
qualified start-up business credit under section 31a of the single
business tax act, 1975 PA 228, MCL 208.31a, or section 415 of the
Michigan business tax act, 2007 PA 36, MCL 208.1415.
(b) A statement authorizing the department of treasury to
release information contained in the qualified start-up business's
annual return filed under the single business tax act, 1975 PA 228,
MCL 208.1 to 208.145, or the Michigan business tax act, 2007 PA 36,
MCL 208.1101 to 208.1601, that pertains to the qualified start-up
business credit claimed under section 31a of the single business
tax act, 1975 PA 228, MCL 208.31a, or section 415 of the Michigan
business tax act, 2007 PA 36, MCL 208.1415.
(3) If a qualified start-up business applies for an extension
for filing its annual single business tax return under section 73
of the single business tax act, 1975 PA 228, MCL 208.73, or section
505 of the Michigan business tax act, 2007 PA 36, MCL 208.1505, the
qualified start-up business may claim the exemption under this
section after May 1 if all of the following conditions are met:
(a) The governing body of the local tax collecting unit adopts
a resolution under subsection (4)(b) approving the exemption for
all qualified start-up businesses that apply for an extension for
filing the annual single business tax return under section 73 of
the single business tax act, 1975 PA 228, MCL 208.73, or section
505 of the Michigan business tax act, 2007 PA 36, MCL 208.1505.
(b) The qualified start-up business submits a copy of its
application for an extension for filing its annual single business
tax return under section 73 of the single business tax act, 1975 PA
228, MCL 208.73, or section 505 of the Michigan business tax act,
2007 PA 36, MCL 208.1505, and the affidavit described in subsection
(2) to the December board of review provided in section 53b of the
general property tax act, 1893 PA 206, MCL 211.53b. For purposes of
section 53b of the general property tax act, 1893 PA 206, MCL
211.53b, an exemption granted under this subsection shall be
considered the correction of a clerical error.
(4) On or before its last meeting in May in each tax year, the
governing body of a local tax collecting unit may adopt a
resolution approving the exemption provided in this section. The
clerk of the local tax collecting unit shall notify in writing the
assessor of the local tax collecting unit and the legislative body
of each taxing unit that levies ad valorem property taxes in the
local tax collecting unit. Before acting on the resolution, the
governing body of the local tax collecting unit shall afford the
assessor and a representative of the affected taxing units an
opportunity for a hearing. A resolution approving the exemption
provided in this section may be for 1 or both of the following:
(a) One or more of the individual qualified start-up
businesses that claim the exemption under this section by filing an
affidavit on or before May 1 as provided in subsection (2).
(b) All qualified start-up businesses that claim the exemption
under this section after May 1 as provided in subsection (3).
(5) A qualified start-up business shall not receive the
exemption under this section for more than a total of 5 tax years.
A qualified start-up business may receive the exemption under this
section in nonconsecutive tax years.
(6) If an exemption under this section is erroneously granted,
the tax rolls shall be corrected for the current tax year and the 3
immediately preceding tax years. The property that had been subject
to that exemption shall be immediately placed on the tax roll by
the local tax collecting unit if the local tax collecting unit has
possession of the tax roll or by the county treasurer if the county
has possession of the tax roll as though the exemption had not been
granted. A corrected tax bill shall be issued for the tax year
being adjusted by the local tax collecting unit if the local tax
collecting unit has possession of the tax roll or by the county
treasurer if the county has possession of the tax roll. If an owner
pays the corrected tax bill issued under this subsection within 60
days after the corrected tax bill is issued, that owner is not
liable for any penalty or interest on the additional tax. If an
owner pays a corrected tax bill issued under this subsection more
than 60 days after the corrected tax bill is issued, the owner is
liable for the penalties and interest that would have accrued if
the exemption had not been granted from the date the taxes were
originally levied.
(7) Real and personal property of a qualified start-up
business is not exempt from collection of the following:
(a) A special assessment levied by the local tax collecting
unit in which the property is located.
(b) Ad valorem property taxes specifically levied for the
payment of principal and interest of obligations approved by the
electors or obligations pledging the unlimited taxing power of the
local governmental unit.
(c) A tax levied under section 705 or 1212 of the revised
school code, 1976 PA 451, MCL 380.705 and 380.1212.
(8) As used in this section, "qualified start-up business"
means that term as defined in section 31a of the single business
tax act, 1975 PA 228, MCL 208.31a, or section 415 of the Michigan
business tax act, 2007 PA 36, MCL 208.1415.