Form Mi-1040cr5 - Michigan Farmland Preservation Tax Credit Instructions

Note: If the property tax statement includes taxable value

Column H: Multiply line 15 or 20 from the MI-1040CR-5,

for land not covered by an FDRA, the taxable value reported

whichever applies, by the percentage computed in column G

in column B must be adjusted accordingly. The taxable

for each agreement and enter in column H.

value that cannot be claimed must be determined by the

MI-1040CR-5

local assessor’s office and submitted on official letterhead.

Line 5: Check the box if all of the taxes that qualify for a

If the property tax statement includes taxable value for land

Homestead Property Tax Credit are included in the total on

on more than one agreement, the taxable value reported

line 4.

in column B must be separated according to land in each

Before completing line 8, read “Computing the Homestead

agreement. The local assessor will be able to determine

Property Tax Credit” on page 4.

what the breakdown is based on the legal descriptions of the

land enrolled under each agreement.

Line 8: Enter your total household resources from your

The entire taxable value for the agreement must be entered

MI-1040CR, MI-1040CR-2, or MI-1040CR-7. If you are a

in column B even if you are eligible to claim only a

part-year or nonresident, include total 2013 total household

portion of the property taxes because of joint ownership(s),

resources, regardless of source.

partnership(s), or multiple shareholders.

Line 13: Enter amount of property tax from line 4. This

Column C: For each agreement, check the box if you

line must be completed.

attached paid tax receipts for 2012 or 2013. If paid receipts

Line 17: If line 17 is less than line 7, carry amount from

are not attached, do not check the box. If you do not check

line 15 to Form MI-1040, line 26. If line 17 is greater than

the box, your Farmland Preservation Tax Credit will be

line 7, complete lines 18 through 20.

issued jointly to you and the treasurer for the county where

PART 2: If you own farmland jointly with someone other

the property is located.

than your spouse, complete Part 2. For each agreement,

Note: Copies of your 2013 property tax statements must

enter the information for each owner.

be attached regardless of whether the box is checked

in column C. If you e-file your MI-1040CR-5, the box

Partners may use Part 2 to show percentage of income or

must indicate whether your 2012 or 2013 property taxes

ownership if no U.S. Form 1065 was required. All partners

are paid (not whether they are attached to the return).

must sign.

E-filers, do not send property tax statements unless

PART 3: If you had net losses from business (including

requested to do so by Treasury at a later date. However,

farm) after netting all business income and loss, net rental

when e-filing, be sure to check the box on Schedule

or royalty losses, or net operating loss deductions, complete

CR-5, column C, when taxes have been paid.

Part 3.

Column D: Enter “I” if you are the individual owner or

Line 21: Add the amounts from:

co-own the land with your spouse, “J” if you are a joint

owner with someone other than your spouse, “P” if the land

• U.S. Schedule C (Profit or Loss from Business).

is owned by a partnership, or “S” if the land is owned by an

• Part II (Ordinary Gains and Losses) of the U.S.

S corporation.

Form 4797.

Column E: If the land is owned by you and someone other

• Part II (Income or Loss from Partnership and S

than your spouse, enter your percent of income from the

Corporations) and Part III (Income or Loss from Estates

signed statement or your percent of ownership based on the

and Trusts) of the U.S. Schedule E.

number of owners. If the land is owned by a partnership,

• Include income items reported as a distributive share.

enter your percent of income or ownership. All partners

must use the same basis for filing. If the land is owned by an

Line 22: Enter income or loss from U.S. Schedule F (Profit

S corporation, enter your percent of stock ownership.

or Loss from Farming)

Column F: Individuals enter the taxes from each tax

Line 23: Total must be less than zero.

If the total is

agreement for the portion of land enrolled under an

positive enter “0.”

agreement. Joint owners, partners, and shareholders

Line 24: Add the amounts from:

enter only their allocated share of taxes from each tax

statement for the portion of land enrolled under an

• Part I (Income or Loss from Rental Real Estate and

agreement.

Royalties) of the U.S. Schedule E.

Note: If the property tax statement includes taxes for land

• Part IV (Income or Loss from Real Estate Mortgage

not covered by an FDRA, the taxes reported in column

Conduits (REMIC)) of the U.S, Schedule E (rents,

F must be reduced accordingly. The amount of taxes

royalties).

that cannot be claimed must be determined by the local

• Part V (Net farm rental income or (loss) from

assessor’s office and submitted on official letterhead. The

Form 4835) of the U.S. Schedule E.

1 percent collection fee may be included. Do not include

penalties, interest, or special assessments.

Total must be less than zero. If the total is positive enter

If the property tax statement includes taxes for land on more

“0.”

than one agreement, the taxes reported in column F must be

Line 25: Enter the lesser of your federal net operating

separated according to land in each agreement. The local

loss deduction (NOL) or federal modified taxable

assessor will be able to determine what the breakdown is

Income (FMTI). Compute your FMTI using page 3 of

based on the legal descriptions of the land enrolled under

Form MI-1045.

each agreement.

Form Mi-1040cr5 - Michigan Farmland Preservation Tax Credit Instructions - 2013 Page 6

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