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A taxpayer eligible to claim the Small Business Alternative Credit (SBAC) ultimately pays a reduced tax rate on a different tax base. Form 4583 allows qualifying standard taxpayers to claim the SBAC and to file and pay the MBT due without computing the Business Income Tax or Modified Gross Receipts Tax.
Forms required to be filed if eligible to use the Simplified Michigan Business Tax (MBT) return are Form 4583 and either Form 4577 (Corporations Only) or Form 4578 (Partnerships Only). Individuals and fiduciaries filing as individuals need not file Form 4577 or Form 4578. Failure to file Form 4577 or 4578 will result in disallowance of the credit and a recalculated liability that includes modified gross receipts tax, business income tax, and surcharge. A complete amended return, including all forms, schedules and attachments, must be filed in order to correct the original return.
In order to be eligible to file Form 4583 as a Corporation, no individual, shareholder or officer can have allocated income of more than $160,000, as verified on Form 4577.
In order to be eligible to file Form 4583 as a Partnership, no partner can have distributive income of more than $160,000, as verified on Form 4578.
In order to be eligible to file Form 4583 as an Individual, no individual can have allocated income of more than $160,000.
The following taxpayers are not eligible to file Form 4583:
A Unitary Business Group (UBG) or a member of a UBG
A taxpayer with gross receipts that exceed $19,000,000
A taxpayer with adjusted business income that exceeds a certain amount - see Form 4583 for the tax year of your adjustment for that year’s limit
A taxpayer with business activity subject to apportionment
A fiscal year filer
A taxpayer claiming credits on Form 4584
A taxpayer required to recapture credits or deductions
A taxpayer who is a financial institution or insurance company.
In all cases above where a taxpayer is not eligible to file the Simplified MBT Return (Form 4583), the MBT Annual Return (Form 4567) may be required. Financial institutions file Form 4590 and insurance companies file Form 4588.