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and records used by the financial institution, so long as the

year included in this return. For example, for a 2013 calendar

method fairly reflects the financial institution’s net capital for

year filer would include Flow-Through Withholding payments

purposes of CIT. If the financial institution owns a subsidiary

made by an FTE whose tax year ended on or after January 1,

that is an authorized insurance company, the equity capital

2013, and on or before December 31, 2013. Any FTE that has

of the insurance subsidiary is not included in the financial

withheld on behalf of the taxpayer should have provided the

institution’s equity capital. Attach supporting schedules. While

taxpayer with the necessary details for its records.

it may be possible to end up with negative net equity, beginning

If an amount is entered on this line, complete the CIT Schedule

with negative equity capital is not permitted.

of Flow-Through Withholding (Form 4911) to account for the

UBGs: Leave lines 10 through 17 blank, complete line 18 with

flow-through withholding payments received. The amount

combined data from Form 4910, line 22, and proceed with the

entered on this line must equal the sum of the combined

rest of the lines on Form 4908.

amount from Form 4911, column E. Attach Form 4911.

Note: In completing the combined return, a member of a UBG

Note: Flow-through withholding is repealed effective with

of financial institutions eliminates its investment of the positive

FTEs’ tax years beginning after June 30, 2016, under Public

equity capital in other members of the same group. Eliminations

Act 158 of 2016. A CIT taxpayer should not have had any tax

occur to equity capital at the member level. Because each

withheld on its behalf by FTEs with tax years beginning after

member of the group must compute the Net Capital tax base

June 30, 2016.

in accordance with GAAP, each member should represent a

Line 26: Enter tax paid with the Application for Extension of

positive or zero equity capital before eliminations.

Time to File Michigan Tax Returns (Form 4).

Line 11: Under PA 38 of 2011, Section 651(k), Michigan

Line 29: If penalty and interest are owed for failure to make

obligations means a bond, note, or other obligation issued by a

sufficient and timely estimated payments, complete the CIT

governmental unit described in Section 3 of the Shared Credit

Penalty and Interest Computation for Underpaid Estimated

Rating Act, Public Act 227 of 1985, MCL 141.1053.

Tax (Form 4899) to compute penalty and interest due. If a

Line 12: Under PA 38 of 2011, Section 651(s), United States

taxpayer chooses not to file this form, Treasury will compute

obligations means all obligations of the United States exempt

penalty and interest and bill for payment. (Form 4899 is

from taxation under 31 USC 3124(a) or exempt under the

available on the Web at )

United States constitution or any federal statute, including

Line 30: Refer to the “Computing Penalty and Interest”

the obligations of any instrumentality or agency of the United

section in Form 4907 to determine the annual return penalty

States that are exempt from state or local taxation under the

rate and use the following Overdue Tax Penalty worksheet.

United States Constitution or any statute of the United States.

Line 15a: If this taxpayer owns a subsidiary that is an

WORKSHEET – OVERDUE TAX PENALTY

authorized insurance company, enter the actual amount of the

A. Tax due from Form 4908, line 28 ........

capital fund maintained within that subsidiary. This does not

B. Late/extension or insufficient

include a captive insurance company.

payment penalty percentage ................

Line 15b: Enter the minimum capital fund amount required by

C. Multiply line A by line B .....................

regulations for that insurance subsidiary.

Carry amount from line C to Form 4908, line 30.

Line 18: UBGs: Combine Forms 4910, line 22, and enter the

Line 31: Use the following worksheet to calculate Overdue Tax

total here. If the combined amount is less than zero, enter zero.

Interest.

UBGs should leave Form 4908, lines 10 through 17 blank.

PART 2: PAYMENTS AND TAX DUE

WORKSHEET – OVERDUE TAX INTEREST

UBGs: On lines 23 through 26, enter combined data for all

A. Tax due from Form 4908, line 28 ........

members included on this combined return.

B. Applicable daily interest percentage ....

C. Number of days return was past due ...

Line 23: Enter overpayment credited from prior MBT or CIT

D. Multiply line B by line C ....................

return.

e. Multiply line A by line D ....................

Line 24: Enter the total estimated CIT tax paid with the CIT

Carry amount from line E to Form 4908, line 31.

Quarterly Tax Return (Form 4913) or the amount of estimated

CIT tax paid through Electronic Funds Transfer. Include all

payments made on returns that apply to the tax year included in

Note: If the late period spans more than one interest rate

this return.

period, divide the late period into the number of days in each

of the interest rate periods identified in the “Computing Penalty

Line 25: Enter the total withholding payments made on your

and Interest” section in Form 4907, and apply the calculations

behalf by Flow-Through Withholding entities. Include all

in the Overdue Tax Interest worksheet separately to each

withholding payments made on returns that apply to the tax

portion of the late period.

year included in this return. Included on this line would be

Flow-Through Withholding payments made by flow-through

Combine these interest subtotals and carry the total to Form

entities (FTEs) whose tax years ending with or within the tax

4908, line 31.

Form 4908 - Michigan Corporate Income Tax Annual Return For Financial Institutions - 2016 Page 6

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