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SENATE BILL NO. 994
A bill to amend 1967 PA 281, entitled
"Income tax act of 1967,"
(MCL 206.1 to 206.847) by adding section 714.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 714. (1) For tax years beginning on and after January 1, 1
2026, an employer that is an organization exempt from federal 2
taxation under section 501(c) of the internal revenue code may 3
claim a work opportunity tax credit against the taxes required to 4
be withheld and remitted to this state under this chapter for 5
May 20, 2026, Introduced by Senators SHINK, OUTMAN and CHANG and referred to
Committee on Economic and Community Development.
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KAS S06895'26_SB0994_INTR_1 jve9hg
qualified wages paid to qualified employees in an amount equal to 1
50% of the amount of the credit the employer is allowed to claim as 2
a credit under section 51 of the internal revenue code for a tax 3
year on a return or report filed under this chapter for the same 4
tax year or would have been allowed to claim if the credit under 5
section 51 of the internal revenue code was still in effect. In 6
calculating the amount of the credit allowed under this section, 7
the employer shall exclude from the amount of the credit allowed or 8
that would have been allowed under section 51 of the internal 9
revenue code for that same tax year, both of the following: 10
(a) Any amount attributable to employees who were not 11
qualified employees. 12
(b) Any amount of unused credits that is carried back or 13
forward from another tax year in accordance with section 39 of the 14
internal revenue code. 15
(2) An employer claiming a credit under this section against 16
the withholdings tax payments made under this chapter shall, in a 17
form and content as prescribed by the department, claim the credit 18
on the annual return or report required under section 711 for that 19
same tax year. 20
(3) If the credit allowed under this section for the tax year 21
exceeds the employer's withholdings tax liability under this 22
chapter, that portion that exceeds the withholdings tax liability 23
for the tax year must not be refunded. 24
(4) As used in this section: 25
(a) "Member of a targeted group" means an individual 26
identified and defined under section 51(d) of the internal revenue 27
code. 28
(b) "Qualified employee" means an employee who is a resident 29
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of this state and has been certified by the Michigan unemployment 1
insurance agency as a member of a targeted group. 2
(c) "Qualified wages" means that term as defined under section 3
51 of the internal revenue code. 4
Enacting section 1. This amendatory act does not take effect 5
unless Senate Bill No. 995 of the 103rd Legislature is enacted into 6
law. 7