Skip to main content
Corporate Tax Base 3. If an entity is subject to the Corporate Income Tax (CIT), will the entity's shareholders be subject to Michigan personal income tax?

Corporate Tax Base 3. If an entity is subject to the Corporate Income Tax (CIT), will the entity's shareholders be subject to Michigan personal income tax?

Yes. An individual shareholder of an entity subject to CIT will also be subject to Michigan income tax on any dividend income paid by the corporation that is included in the shareholder's taxable income, if the individual is a Michiga resident. Dividend income that is not business income is allocated to the shareholder's state of residence for individual Income Tax purposes. MCL 206.113.