Form 4595 - Michigan Business Tax Renaissance Zone Credit Schedule

Line 19b: UBGs: Enter the pro forma apportionment

BUSINESS ACTIvITY CONDUCTED WIThIN

percentage from Form 4580, Part 2A, line 16, for the member

THe ReNAISSANCe ZONe

whose activity is reported on this copy of Form 4595.

Line 3: Determine the average value of property by averaging

the values at the start and end of the tax period. The State

Insurance companies and financial institutions: Unlike

Treasurer may require the periodic averaging of values during

standard taxpayers, these types of taxpayers do not apportion

the tax year if reasonably required to reflect properly the

their tax base by a sales factor. For Renaissance Zone credit

average value of a taxpayer’s property. Property owned by the

purposes, however, they must calculate pro forma sales in

taxpayer is valued at its original cost.

Michigan and sales everywhere, and enter here a pro forma

apportionment percentage based on those figures. See

Line 4: Property rented by the taxpayer is valued at eight (8)

instructions for Form 4567 for guidance on the definition of

times the net annual rental rate. Net annual rental rate is the

sales and applicable sourcing provisions.

annual rental rate paid by the taxpayer less any annual rental

rate received by the taxpayer from subrentals.

Line 20: Enter amount from line 18, or, if the taxpayer is an

Individual, Partnership, S Corporation, or an LLC federally taxed

AdjUSTed SeRvICeS PeRFORMed IN THe

as a Partnership or S Corporation, enter amount from line 19e.

ReNAISSANCe ZONe

Line 17: Enter the amount deducted in arriving at federal

TAxpAYERS FIRST LOCATED WIThIN ThE

taxable income (as defined for MBT purposes) for the tax

RENAISSANCE ZONE BEFORE 12-31-2002 ONLY

year for depreciation, amortization, or accelerated write-

For a person located in the Zone before December 31, 2002,

off for tangible property in a Zone exempt under Michigan

that had no credit or no Michigan payroll in 2007, line 23 will

Compiled Law (MCL) 211.7ff. Claim property exempt in

calculate to zero. Therefore, such a person will not be entitled

the tax year; also claim new property that will be exempt

to a Renaissance Zone Credit on the Michigan Business Tax

in the immediately following tax year (i.e., property that

Return. If completing this form you must enter zero on line 24.

has not been subject to, or exempt from, the collection of

Line 22: Taxpayers first located within the Renaissance Zone

taxes under the General Property Tax Act and has not been

before December 31, 2002, ONLY (all others, leave lines 22a

subject to, or exempt from, ad valorem property taxes levied

through 22e blank). A taxpayer that is located and conducting

in another state, except that receiving an exemption as

business activity in two Zones will prepare two copies of Form

inventory property does not disqualify property).

4595. Base each copy on the taxpayer’s history in the Zone

Line 19: Only a person reporting under an MBT organization

being reported.

type of Individual, Partnership, or S Corporation should

Lines 25a and 25b: For a tax year that begins within one of

complete line 19. This includes a Limited Liability Company

the last three years of the Zone’s designation, a reduced credit

(LLC) that files its federal return as a Partnership or S

is allowed, as follows:

Corporation.

• For a tax year that begins within the second year before the

NOTE: A person that is a disregarded entity for federal tax

final year of designation as a Renaissance Zone, 75 percent of

purposes, including a single member LLC or Q-Sub, must file

the normally calculated credit is allowed.

as if it were a sole proprietorship if owned by an individual, or a

branch or division if owned by another business entity. However,

• For a tax year that begins within the year before the final

year of designation as a Renaissance Zone, 50 percent of the

a person that is disregarded for federal income tax purposes and

normally calculated credit is allowed.

that has already filed separately for its 2010 MBT tax year in either

an original MBT return prior to January 1, 2012, or in an amended

• For a tax year that begins within the final year of

MBT return prior to December 1, 2011, may also file separately for

designation as a Renaissance Zone, 25 percent of the normally

its 2011 MBT tax year. A federally disregarded entity that files as

calculated credit is allowed.

a distinct entity is classified for MBT purposes according to the

Line 25b: Multiply line 24 by the reduced credit percentage

federal tax classification of its owner. For additional information,

provided in the Reduced Credit Table. Carry amount to line 14

see “Changes for Disregarded Entities” in the “Important

of the MBT Miscellaneous Nonrefundable Credits (Form 4573),

Information” section of the MBT Forms and Instructions for

or line 17 of the MBT Miscellaneous Credits for Insurance

Standard Taxpayers (Form 4600).

Companies (Form 4596).

Line 19a: UBGs: Enter the business income from the MBT

If filing multiple 4595 forms, enter the total of line 25b for

UBG Combined Filing Schedule for Standard Members,

all Zones on Form 4573, line 14, or Form 4596, line 17, as

Form 4580, Part 2A, line 30, for the member whose activity is

applicable.

reported on this copy of Form 4595.

Include completed Form 4595 as part of the tax return filing.

Insurance companies and financial institutions: These types

of taxpayers do not calculate business income as their tax base.

For Renaissance Zone credit purposes, however, they must

calculate and enter here pro forma business income. Use the

Business Income Worksheet (Worksheet 4746), in Form 4600,

to calculate business income. Attach that worksheet to the

return. See MCL 208.1201 for further guidance.

Form 4595 - Michigan Business Tax Renaissance Zone Credit Schedule - 2011 Page 4

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