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Unitary Business Groups 4. How do the CIT filing thresholds apply to a unitary business group?
A taxpayer, other than a taxpayer subject to the tax imposed under chapter 12 (Insurance Company) or 13 (Financial Institution), whose apportioned or allocated gross receipts are less than $350,000.00 does not need to file a return or pay the tax imposed under the CIT. A taxpayer, including insurance companies and financial institutions, whose tax liability is less than or equal to $100 does not need to file a return or pay the tax imposed. MCL 206.685(1). “Taxpayer” means “a corporation, insurance company, financial institution, or unitary business group, whichever is applicable under each chapter that is liable for a tax, interest, or penalty under this part.” MCL 206.611(5). Thus, for corporations, so long as the apportioned or allocated gross receipts of the unitary business group equal or exceed $350,000, the unitary business group must file a return and pay the tax imposed by the CIT regardless of the gross receipts of the members of the unitary business group. Taxpayers whose tax liability is less than or equal to $100.00 do not need to file a return or pay the tax imposed. MCL 206.685(1).
For example, a unitary business group is comprised of Corporations A, B, C, D, and E, each with $80,000 in gross receipts. Assuming allocation of the tax base and no intercompany transactions, the gross receipts of the unitary business group is $400,000. Since the group’s gross receipts exceeds the $350,000 filing threshold, the taxpayer is required to file a return and pay the tax imposed by the CIT if the tax liability exceeds $100.00. The fact that no member of the unitary business group would meet the filing threshold if considered individually is immaterial.