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Instructions for Form 4585

Michigan Business Tax (MBT) Investment Tax Credit Recapture

From Sale of Assets Acquired Under Single Business Tax

attributable to the installment sale that is reported in subsequent

Purpose

years increases the credit base (or reduces other sources of

To calculate the Investment Tax Credit (ITC) recapture amount

recapture) for those years, and must be reported either on line 1,

for the disposition or transfer of tangible, depreciable real or

column C, or line 2, column C, based on the type of asset.

personal property acquired in tax years beginning after 1999 and

Line 1: For depreciable tangible assets located in Michigan that

prior to 2008 which must be recaptured to the extent used and at

were acquired or moved into Michigan after acquisition in a tax

the rate used under the Single Business Tax (SBT) or MBT. Form

year beginning after 1999 and prior to 2008, and were sold or

4585 must be filed as a supporting schedule for the total recapture

otherwise disposed of during the tax year, enter the following:

amount reported on the MBT Credits for Compensation,

• Column A: Separate the depreciable tangible assets that

Investment and Research and Development (Form 4570).

were disposed of during the filing period by the tax year

Fiscal Year Filers: See “Supplemental Instructions for

in which they were acquired. Use a separate row for each

Standard Fiscal MBT Filers” in the MBT Forms and

acquisition year. Enter the tax years of acquisition (end dates

Instructions for Standard Taxpayers (Form 4600).

only) in chronological order, starting with the first tax year

beginning after 1999. An acquisition year for which there were

Line-by-Line Instructions

no dispositions of depreciable tangible assets during the filing

Lines not listed are explained on the form.

period may be omitted. However, do not omit the acquisition

year of depreciable tangible assets that have been sold on an

REMINDER: Report all amounts in whole dollars. Round

installment method if gains attributable to installment payments

down amounts of 49 cents or less. Round up amounts of 50

received during the current filing period must be reported.

cents or more. If cents are entered on the form, they will be

• Column B: Total gross proceeds from all depreciable

treated as whole dollar amounts.

tangible assets that were acquired in the same taxable year and

Dates must be entered in MM-DD-YYYY format.

disposed of during the filing period. If a qualifying asset was

sold on an installment sale in a prior filing period, the entire

Name and Account Number: Enter name and account number

as reported on page 1 of Form 4567.

sale price was reported for recapture purposes in the year of

sale. Therefore, if a payment was received on that installment

UBGs: Complete one form for each member that disposed of

sale in the current filing period, do not report that amount as

capital assets that trigger SBT ITC credit recapture. Enter the

gross proceeds for this period. See Column C, however, with

Designated Member (DM) name in the Taxpayer Name field

respect to the gain from that installment payment.

and the specific member of the UBG for which this form is

• Column C: Net total gains/losses reflected in federal taxable

filed on the line below. On the copy filed to report the DM’s

income (as defined for MBT purposes) from all depreciable

data (if applicable), enter the DM’s name and account number

tangible assets that were acquired in the same taxable year and

on each line.

disposed of during the filing period. Report also in column C

UBGs: If capital asset subject to recapture is from a member

any gain reflected in federal taxable income (as defined for MBT

that was not part of the group in the tax year the asset was

purposes) that is attributed to an installment payment received

acquired (and other years since the acquisition), take care

during the current MBT filing period, from a prior installment

to report in this line (and the others that pertain to years the

sale of an asset that was of a type and acquisition date covered

member was not part of the group) information requested in

by line 1. For property placed in service prior to January 1,

each column only from the member’s single filings, not the

2008, gain reflected in federal taxable income (as defined

group’s.

for MBT purposes) is equal to the gain reported for federal

purposes.

PART 1: CALCULATION OF SBT ITC RECAPTURE BASES

Keep in your files a separate worksheet with the appropriate

In Part 1, compute the adjusted proceeds (proceeds include any

benefit derived) from the disposition of tangible, depreciable

information regarding each depreciable tangible asset located

in Michigan that was acquired or moved into Michigan after

real or personal property that was acquired in a tax year

acquisition in a tax year beginning after 1999 and prior to

beginning after 1999 and prior to 2008, and the recapture for

2008, and was sold or otherwise disposed of during the tax

property moved out of state. The calculation of gross proceeds

year. Sum the total gross proceeds and gain or loss for all

may be reduced by selling expenses. Lines 1, 2, and 3 represent

disposed assets acquired in the same taxable year. Enter in

three different categories of SBT ITC assets, categorized by

this form only the total sum of gross proceeds and gain/loss

type of asset or nature of disposition.

grouped by taxable year the assets were acquired. Use one row

NotE: A sale of qualifying property reported on the installment

per group of disposed assets acquired in the same taxable year.

method for federal income tax purposes causes a recapture of

Start from the earliest acquisition year.

the entire gross proceeds in the year of the sale. The recapture

• Column D: Enter the apportionment percentage from Form

is reduced by any gain reported in federal taxable income (as

defined for MBT purposes) in the year of the sale. The gain

4567, line 11c. If not apportioning, enter 100 percent. Enter the

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Form 4585 - Michigan Business Tax Investment Tax Credit Recapture From Sale Of Assets Acquired Under Single Business Tax - 2012 Page 3

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