What is a composite return?

A composite return is an individual income tax return that reports the aggregate distributive share income of two or more participating nonresident owners of a Flow-Through Entity (FTE).   The FTE files the Michigan Composite Individual Income Tax Return (807).  A member who is also an FTE may participate on behalf of its nonresident individual owners.  If a nonresident individual participates in the composite filing, he or she does not have to file an individual income tax return in Michigan unless they have other sources of taxable Michigan income. 

C-corporations (CIT filers) cannot participate on a composite return nor can an intermediate member FTE participate on behalf of C-corporation owners.