My Blog dated Tuesday June 16, 2009 titled "Michigan Business Tax Filing Threshold" should be disregarded for now.  It is not my intention to use this blog to promote positions contrary to the Michigan Department of Treasury promulgated policy.  That can be best accomplished in a different venue.

The following position as stated in my blog is indeed contrary to Treasury FAQ M22 (below).

From Ed Kisscorni's blog dated June 16, 2009:

Section 505 of the Michigan Business Tax Act states: “A taxpayer … whose apportioned or allocated gross receipts are less than $350,000.00 does not need to file a return or pay the tax imposed under this act. The apportioned or allocated gross receipts are defined in Section 115, not Section 111 of the Michigan Business Tax Act.

(1) An annual or final return shall be filed with the department in the form and content prescribed by the department by the last day of the fourth month after the end of the taxpayer's tax year. Any final liability shall be remitted with this return. A taxpayer, other than a taxpayer subject to the tax imposed under chapter 2A or 2B, whose apportioned or allocated gross receipts are less than $350,000.00 does not need to file a return or pay the tax imposed under this act.

From Michigan Department of Treasury Frequently Asked Questions:

Mi22. For purposes of calculating the $350,000 filing threshold in section 505(1); will “gross receipts” as defined in section 111 be used, or will the filing threshold be determined by “sales” as defined in section 115? What meaning is given to the term “apportioned or allocated gross receipts”?

The definition of “gross receipts” will be used to calculate the $350,000.00 filing threshold not the definition of “sales.” This is based upon the express language of section 505(1) that the filing threshold is determined by “apportioned or allocated gross receipts.”

The term “apportioned or allocated” has the same meaning as in the Michigan Business Tax Act. When a taxpayer’s business activity is subject to tax within and outside of Michigan its tax base is apportioned, and business activity confined solely to this state results in the tax base being allocated to Michigan.

My plan is to research and digest this issue which creates an undue hardship on many taxpayers not otherwise subject to the Michigan Business Tax.  I will address it in a future State and Local Tax Information release.

I apologize for the confusion.