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Corporate Income Tax

Nexus & Apportionment 7. For purposes of apportionment, in determining whether a Michigan-based taxpayer has nexus with a state other than Michigan pursuant to MCL 206.661(3), must gross receipts in any "one" state or in all states equal or exceed

Because the nexus standard at MCL 206.621(1) references $350,000 in gross receipts sourced to a single state (Michigan), in applying that standard to determine whether a taxpayer is subject to tax in another state for purposes of apportionment, a taxpayer must meet the $350,000 gross receipts threshold in a single non-Michigan state. Also, MCL 206.661(3) by its terms refers to "another state" (singular) having jurisdiction to subject the taxpayer to tax. Accordingly, a Michigan-based taxpayer having gross receipts of $150,000 in one non-Michigan state and gross receipts of $200,000 in another non-Michigan state would not meet the standard under MCL 206.661(3) and would not be able to apportion its tax base.