Michigan Tax Amnesty And Tax Returns Guide And Instructons Page 15
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41INSTRUCTIONS FOR C-8000C
CREDIT FOR SMALL BUSINESSES AND CONTRIBUTION CREDITS
Purpose: To allow you to choose either the standard or
determine eligibility and to compute the small business
alternate small business credit and to claim your
credit. If annualized gross receipts exceed $9 million but
contribution credits.
do not exceed $10 million, annualize figures to compute
Part 3. Part-year partners or shareholders must annualize
The small business credit is reduced if an individual, a
their share of business income to determine their
partner in a partnership or shareholder or officer of a
eligibility. See page 6.
corporation has allocated income after loss adjustment of
Loss Adjustment. If you are not eligible for the full
more than $95,000. This reduction is based on the
small business credit or the alternate tax calculation due to
individual/partner/officer/shareholder with the largest
an adjusted business income or allocated income
allocated income.
disqualifier, you may benefit from the SBT Loss
Adjustment Worksheet (3307), page 25. If your adjusted
Note: For the purpose of computing the small business
business income was less than zero in any of the five
credit, a member of an LLC is treated as a partner if the
years immediately preceding the tax year for which you
LLC is taxed as a partnership.
are claiming a credit and you received a small business
credit for that same year, you may adjust for the loss. A
ELIGIBILITY
loss adjustment will not affect a reduction to the small
You are not eligible for either the standard small business
business credit based on gross receipts that exceed 9
credit or the alternate tax if any of the following
million. It will also not change the amount of allocated
conditions exist.
income on C-8000KC, Column K for a C-corporation.
1. Gross receipts exceed $10 million.
Controlled groups or entities under common control as
2. Adjusted business income, after loss adjustment,
defined in the IRC are not eligible for the standard small
exceeds:
business credit or alternate tax unless the business
a. $475,000 for corporations, partnerships and LLCs.
activities of the entities are consolidated, whether or not a
b. $115,000 for individuals or fiduciaries.
consolidated SBT return is filed. This means the gross
receipts, adjusted business income and tax base of all
3. Any shareholder or officer has compensation or
members of the group must be combined to determine
allocated income, after loss adjustment, of over
eligibility and to compute this credit.
$115,000; or any partner has distributive share of
income, after loss adjustment, of over $115,000 as
In other words, if the combined gross receipts exceed
determined on C-8000KC or C-8000KP.
$10 million, the combined adjusted business income after
• Corporations - Allocated income for regular
loss adjustment exceeds $475,000, or any one individual,
partner, shareholder or officer has allocated income after
corporations is either:
loss adjustment of more than $115,000 from any one
a. shareholders’ or officers’ compensation and
member of the group, the group is not eligible for the
directors’ fees from C-8000KC, column K, or
credit.
b. shareholders’ compensation, directors’ fees and
share of business income, after loss adjustment, or
If the group is eligible and files a consolidated SBT
loss from C-8000KC, column M.
return, compute either the standard small business credit
or alternate tax on a consolidated basis using Form
If either 3a or 3b is greater than $115,000, the
C-8000C.
corporation is not eligible for the small business credit.
In addition, if either 3a or 3b is more than $95,000 but
If separate SBT returns are filed, determine the
not more than $115,000, the corporation must reduce
combined credit and each member’s share of the credit on
the small business credit based on the individual/
SBT Allocation of Statutory Exemption, Standard Small
partner/officer/shareholder with the largest allocated
Business Credit and Alternate Tax for Members of
income.
Controlled Groups (Form C-8009). Attach a copy of
Form C-8009 to each member’s SBT return.
• S-Corporation - Allocated income for S-corporations
is shareholders’ compensation, directors’ fees and
share of business income, after loss adjustment, or loss
from C-8000KC, column M.
If your tax year is less than 12 months, gross receipts,
adjusted business income, partners’ and shareholders’ or
officers’ share of business income must be annualized to
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