Public Act 240 and 241 of 2003 allow for a partial exclusion of health care costs from tax base, beginning in 2004.

Page 12 of the 2005 Michigan Single Business Tax forms and instructions booklet states the following for the C-8000, Michigan Single Business Tax Annual Return:

Line 13, Employee Insurance Plans. Enter payments to health or life insurance plans for employees, payments for health and welfare and non-insured benefit plans, and payment of fees for the administration of health and welfare and non-insured benefit plans.

Do not include here or on line 15, contributions for FICA (Social Security and Medicare), workers' compensation insurance or the State and Federal Unemployment Compensation Fund.

For tax years beginning in 2005, compensation excludes 20% of health care benefits provided to MICHIGAN residents. Health care benefits are payments under health and welfare and noninsured benefit plans and payments for the administration of those plans. The percentage exclusion increases for subsequent years.

The agreement number is found in the lower right corner of each agreement. The first two numbers represent the county where the property is located.

The middle set of numbers is the actual CONTRACT NUMBER. The contract number retains its original series throughout the term of the agreement. However, a letter may be added to indicate that the agreement was split into multiple agreements. Always use the contract number on your most recently recorded agreement. The contract number can be up to six digits in length. If zeros should be included in the contract number they will be visible on the printed copy of the agreement. It is acceptable to have blank spaces at the beginning of the contract number.

For example: Agreement number 88-0123-123105 would be entered with two blank spaces preceding the contract number of 0123.

In all cases contract numbers should NOT be left-filled with zeroes. In very few cases, it is possible to have a contract number with three or less numeric digits that does not begin with zero.

For example: Agreement number 88-567-123105 would be entered with three blank spaces preceding the contract number of 567.

The final six numbers of the agreement number are the year of expiration, (i.e., 123105 is December 31, 2005). The year of expiration changes when the agreement is reduced or extended. Agreement numbers with an expiration year-end date equal to 00 through 04 are not eligible for e-file.

If your software is carrying forward the taxpayer's information from the previous years filing, you may want to review a copy of the actual farmland agreement so you can verify the CONTRACT NUMBERS and determine if they have preceding zeros, before e-filing the return.

Incorrect agreement numbers will delay processing of the return and issuance of the refund.

Information related to filing of farmland credits is available in the Alternative Filing Tax Preparer Handbook for Tax Year 2005 and the Farmland Preservation Tax Credit Claim Instruction Book (form included).