October 4, 2018, Introduced by Rep. Iden and referred to the Committee on Tax Policy.
A bill to amend 1967 PA 281, entitled
"Income tax act of 1967,"
(MCL 206.1 to 206.713) by adding section 261.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 261. (1) For tax years beginning on and after January 1,
2019, a taxpayer may credit against the tax imposed by this part
for the tax year an amount, subject to the applicable limitations
under this section, equal to 50% of the amount the taxpayer
contributes during the tax year to a community foundation. For a
taxpayer other than a resident estate or trust, the credit allowed
under this subsection shall not exceed $100.00, or $200.00 for a
joint return. For a resident estate or trust, the credit allowed
under this subsection shall not exceed 10% of the taxpayer's tax
liability for the tax year before claiming any credits allowed by
this part or $5,000.00, whichever is less. For a resident estate or
trust, the amount used to calculate the credits under this section
shall not have been deducted in arriving at federal taxable income.
(2) If the amount of the credits allowed under this section
exceeds the tax liability of the taxpayer for the tax year, the
portion that exceeds the tax liability shall not be refunded.
(3) On or before July 1 of each year, the department shall
report to the house committee on tax policy and the senate finance
committee the total amount of tax credits claimed under this
section for the immediately preceding tax year.
(4) As used in this section, "community foundation" means an
organization that applies for certification on or before May 15 of
the tax year for which the taxpayer is claiming the credit and that
the department certifies for that tax year as meeting all of the
following requirements:
(a) Has been in existence for at least 10 years and has assets
of at least $1,000,000.00.
(b) Qualifies for exemption from federal income taxation under
section 501(c)(3) of the internal revenue code.
(c) Supports a broad range of charitable activities within the
specific geographic area of this state that it serves, such as a
municipality or county.
(d) Maintains an ongoing program to attract new endowment
funds by seeking gifts and bequests from a wide range of potential
donors in the geographic area served.
(e) Is publicly supported as defined by 26 CFR 1.170A-9(f). To
maintain certification, the community foundation shall submit
documentation to the department annually that demonstrates
compliance with this subparagraph.
(f) Is not an organization as described in section 509(a)(3)
of the internal revenue code.
(g) Meets the requirements for treatment as a single entity
contained under 26 CFR 1.170A-9(f)(11).
(h) Has an independent governing body representing the general
public's interest and that is not appointed by a single outside
entity.
(i) Provides evidence to the department that the community
foundation maintains continually during the tax year for which the
credit under this section is claimed at least 1 part-time or full-
time employee.
(j) Is subject to an annual independent financial audit and
provides copies of that audit to the department not more than 3
months after the completion of the audit.
(k) In addition to all other criteria listed in this
subsection for a community foundation that is incorporated or
established after January 9, 2001, operates in a county of this
state that was not served by a community foundation when the
community foundation was incorporated or established or operates as
a geographic component of an existing certified community
foundation.
Enacting section 1. This amendatory act does not take effect
unless Senate Bill No.____ or House Bill No. 6433 (request no.
06983'18) of the 99th Legislature is enacted into law.