Form 4573 - Business Tax Miscellaneous Nonrefundable Credits

purposes. All members of a shareholder’s family, as defined

An eligible taxpayer must expend at least $30,000,000 on

capital expenditures before January 1, 2011. An eligible

by Internal Revenue Code (IRC) § 318(a)(1), that receive

taxpayer is any of the following:

compensation from the business are considered shareholders.

• An officer of a C Corporation.

• A person who owns and operates a motorsports

• A partner of a Partnership or Limited Liability Partnership.

entertainment complex and has at least two days of

sanctioned motorsports events each calendar year which are

• A member of a Limited Liability Company (LLC).

comparable to NASCAR Nextel Cup events held in 2007 or

• An Individual who is an owner.

their successor events.

• A person who is the lessee and operator of a motorsports

Officer means an officer of a corporation other than a

entertainment complex or the lessee of the land on which a

subchapter S corporation, including all of the following:

motorsports entertainment complex is located and operates

(a) The chairperson of the board, (b) The president, vice

that motorsports entertainment complex.

president, secretary, or treasurer of the corporation or board,

• A person who operates and maintains a motorsports

entertainment complex under an operation and management

persons described in subdivisions (a) and (b) that include, at a

agreement.

minimum, major decision making.

Corporations (and LLCs federally taxed as such) must report

Motorsports entertainment complex and Motorsports event are

defined terms in the statute.

compensation and director fees of shareholders and (if a C

Corporation) officers on the MBT Schedule of Shareholders

Line 2: Enter eligible capital expenditures on infield renovation,

and Officers (Form 4577) and include it as part of the return.

grandstand, and infrastructure upgrades, and any other

Partnerships (and LLCs federally taxed as such) must report

construction and upgrades. If eligible capital expenditures were

distributive shares to partners on the MBT Schedule of Partners

made by a member of a UBG, enter the lesser of the eligible

(Form 4578) and include it as part of the return.

capital expenditures or the eligible member’s pro forma liability.

A taxpayer that meets the criteria and that is a qualified start-up

UBGs: If the eligible taxpayer is a member of a UBG, a pro

business that does not have business income for two consecutive

forma calculation must be performed to determine the tax

tax years may claim a credit against the tax imposed for the

liability of the eligible taxpayer prior to this credit. Where a

second of those two consecutive tax years and each immediately

pro forma calculation is required, the underlying objective

following consecutive tax year in which the taxpayer does not

is to determine what the tax liability of the UBG member

have business income. For the purposes of this credit, business

generating the credit would have been if that member was not

income excludes funds received from small business innovation

included in the UBG. Therefore, the UBG member generating

research grants and small business technology transfer programs

the credit must calculate its pro forma tax liability as if it was

established under the Small Business Innovation Development

a singular, stand alone taxpayer in all aspects. This supporting

Act of 1982, Public Law 97-219, reauthorized under the Small

calculation should be provided in a statement attached to this

Business Research and Development Enhancement Act, Public

form. However, this calculation should never be transferred to a

Law 102-564, and subsequently reauthorized under the Small

Form 4567 or displayed as such.

Business Reauthorization Act of 2000, Public Law 106-554.

Line 3: Enter the lesser of line 1, line 2 or $1,580,000.

A Start-Up Business Credit cannot be claimed for more than

a total of five tax years including the number of years the

Stadium Credit

taxpayer was eligible to claim the credit under SBT.

Lines 4-6: This credit is no longer available. Leave these lines

UBGs: If the eligible taxpayer is a member of a UBG, this

blank.

credit is based on the eligible member’s business activity only.

Start-Up Business Credit

This credit amount is limited to the pro forma tax liability

The Start-Up Business Credit provides a credit for small,

calculated for the eligible taxpayer for that tax year. The

relatively new taxpayers with substantial research and

resulting credit amount is then applied towards the UBG’s tax

development activity. For a qualified taxpayer, the credit is

liability for that tax year.

equal to the taxpayer’s MBT liability for the year. To qualify, a

Line 7: Enter the tax liability from Form 4568, line 12, or the

taxpayer must apply to and obtain annual certification from the

eligible member’s pro forma liability if part of a UBG. Attach

Michigan Economic Development Corporation (MEDC), and

supporting MEDC Certification Letter.

attach that certificate to its MBT return. For an application form

UBGs: See guidance on pro forma calculations in the UBG

or additional information, call the MEDC at (517) 373-9808.

note under line 2.

For the tax year for which a Start-Up Business Credit is

claimed, compensation, director fees, or distributive shares

Line 8: Enter any recapture of Start-Up Business Credit.

paid by the taxpayer to any one of the following cannot exceed

NOTE: A company claiming the Start-Up Business Credit

$135,000:

under either MBT or SBT must pay back a portion of the credit

• A shareholder of a C Corporation or S Corporation.

if they have no business activity in Michigan and have business

Shareholder means a person who owns outstanding stock in

activity outside of Michigan within three years after the last

a business or is a member of a business entity (for example,

tax year in which the credit was taken. The following amounts

an LLC) that files as a corporation for federal income tax

must be added to the tax liability:

Form 4573 - Business Tax Miscellaneous Nonrefundable Credits - 2014 Page 6

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