2015 Tax TexT - michigan.gov

1 2015. Tax Text michigan Department of Treasury Disclaimer: This publication is intended for general education on tax laws enforced by the michigan Department of Treasury. It does not constitute a revenue administrative bulletin or a letter ruling. While every attempt has been made to ensure the accuracy of this book, it is not an exhaustive review of all applicable local, State, and federal statutes that could affect taxes. In addition, new legislation, regulations, court decisions, notices, and announcements could affect the accuracy of this book. Please be aware that Treasury's interpretation of the law may change because of legislation, court cases, and other events.

2 Readers are advised to monitor Treasury's Web site and other authoritative sources for changes that may affect taxes. 2015 TAX TEXT. TABLE OF CONTENTS. ADMINISTRATIVE INFORMATION. Page Overview .. 1. Administrative Information .. 1. 1. Individual Income Tax Self-Service .. 1. Business Taxes Self-Service .. 2. michigan Treasury Online Services .. 2. New Online Filing and Payment Options in 2015 .. 3. Income Tax Terms Used in Treasury Income Tax Self-Service .. 3. Why Self-Service Might Indicate Treasury Has Not Received an Income Tax Return .. 4. E-Registration for michigan Taxes.

3 4. Disclosure Guidelines .. 5. Identity Theft .. 6. Taxpayer Rights and Responsibilities .. 7. The Billing Process .. 7. Payment of the Additional Tax .. 7. Jeopardy Assessments for Extreme Cases .. 8. Refunds .. 8. Refund Different Than Expected .. 9. The Appeals Process .. 9. Informal Conference .. 9. michigan Tax Tribunal .. 10. Court of 10. Offer in Compromise Program .. 11. Treasury Reporting Requirements .. 11. Administrative Dispute 14. Forms .. 14. Availability of Tax 14. Penalty and Interest .. 15. Interest .. 16. Waiver of Penalty .. 16. Intercepting 17.

4 Web Site .. 17. Contact Numbers .. 17. Contact List on Web .. 17. Protect Your 18. i Page Helpful Information .. 18. Calling .. 18. Writing .. 18. Making a Payment .. 19. Treasury Letters .. 19. E-mail LISTSERV for Tax Professionals .. 19. Summary of Unclaimed Property Law .. 20. Who Must Report .. 20. What Must Be Reported .. 20. Reporting Due Date and Penalty for Noncompliance .. 20. How to Report .. 20. Noncompliance With Unclaimed Property Reporting Requirements .. 21. How Owners Locate Unclaimed Property Reported to the State of michigan .. 21.

5 Ii INDIVIDUAL INCOME TAX. Page What's New .. 22. Senate Bill 100 of 2015 (PA 0079 of 2015) .. 22. Supreme Court of the United States-Same-Sex Marriage .. 22. Employer Provided Same-Sex Spousal Benefits .. 22. City of Detroit Individual Income Tax .. 23. Business, Rental, and Royalty Activity Worksheet .. 23. MI-1040H Unitary Apportionment Worksheet .. 23. Reminders .. 24. Forms .. 24. Individual Income Tax 24. Substitute Forms Must Be 24. Mailing Addresses .. 25. Federal/State and State Standalone Electronic Filing Program .. 25. How Fed/State (Linked) Electronic Filing Works.

6 27. How State Standalone (Unlinked) Electronic Filing Works .. 27. Who May Participate .. 28. Application Process and Acceptance Process .. 28. michigan Portion of the Electronic Return .. 29. Electronic michigan Returns .. 29. Nonelectronic Portion of michigan Returns .. 32. michigan E-file Signature Process .. 33. Volunteer Groups .. 33. Tax Refund and Payment 34. For More Information .. 35. Post-Filing Information .. 36. Mailing Addresses .. 36. Amended Returns (MI-1040X or MI-1040X-12) .. 36. Summary of Changes for 2015 .. 37. Summary of Changes for Prior Years.

7 38. Filing 38. Filing a MI-1040 Return .. 38. Factors to Determine Domicile .. 39. Nonresident Aliens .. 39. Taxability of Income Derived Within Indian Country .. 40. Estimated Income Tax .. 41. e-Payments .. 42. Seafarers, Farmers, and Commercial Fishermen .. 43. Exemptions .. 43. Definitions of michigan Special Exemptions .. 43. Qualified Disabled Veteran Exemption .. 45. Part-Year and Nonresident .. 45. Claimed as a Dependent .. 46. michigan Income Tax Treatment of Child's Unearned Income .. 47. iii Page Adjustments to Arrive at michigan Taxable 47.

8 Additions .. 48. Subtractions .. 48. Items Not Allowed as Subtractions .. 49. Miscellaneous Deductions .. 49. Income From Oil and Gas Production and Nonferrous Metallic Minerals Extraction .. 49. Renaissance Zones .. 49. Pension and Retirement Benefits .. 51. Employer Plans .. 51. Individual Plans .. 52. Pension Limitations Based on Date of 53. Income Tax For Retirement Benefits Effective For Tax Year 55. Unlimited Public Pension Subtraction .. 56. michigan and Federal Public Pensions .. 56. Public Pensions: Railroad Retirement and Pension Benefits.

9 56. Public Pensions From Other States .. 56. Combined Public and Private Pension .. 57. Private Pensions .. 57. Pension Subtraction 58. Conversion of Roth IRAs .. 59. Litigation Affecting Rollover Into an IRA .. 59. 2015 Pension Subtraction Table for Tier 1 Retirees .. 60. Deferred Compensation .. 61. Interest, Dividends, and Capital Gains Deduction For Senior Citizens Born Before 1946 .. 62. 529 Education Plans .. 62. michigan Education Savings Program .. 62. michigan Education Trust .. 63. Coverdell Educational Savings Account (formerly Educational IRA).

10 63. Nonresidents' Taxable Income .. 64. Withholding for Nonresidents .. 65. Flow-Through Entity Distribution of Income and Losses .. 65. Business, Rental, and Royalty Activity Worksheet .. 66. Composite Individual Income Tax Return for Nonresident Partners/Shareholders/Members .. 67. Apportionment of Flow-Through Entities Under the Unitary Business Principle .. 67. Adjustments of Capital Gains and Losses - MI-1040D .. 68. Net Operating Loss Carryback and Carryforward .. 69. NOL Frequently Asked 70. Tips for Filing .. 72. Gambling Income .. 73. Military Pay.