HOUSE BILL No. 5421

 

 

January 16, 2018, Introduced by Reps. Noble, Hauck and Tedder and referred to the Committee on Tax Policy.

 

     A bill to amend 1964 PA 284, entitled

 

"City income tax act,"

 

by amending sections 31 and 44 of chapter 2 (MCL 141.631 and

 

141.644), section 31 as amended by 1988 PA 120.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

                              CHAPTER 2

 

     Sec. 31. (1) An individual taxpayer in computing his or her

 

taxable income is allowed deductions for the full personal and

 

dependency exemptions authorized by the federal internal revenue

 

code part 1 of the income tax act of 1967, 1967 PA 281, MCL 206.1

 

to 206.532 or, on the passage of a further ordinance, a deduction

 

of a minimum of $600.00 for each personal and dependency exemption

 

under the rules for determining exemptions and dependents as


provided in the federal internal revenue code. part 1 of the income

 

tax act of 1967, 1967 PA 281, MCL 206.1 to 206.532. The taxpayer

 

may claim his or her spouse and dependents as exemptions, but if

 

the taxpayer and the spouse are both subject to the tax imposed by

 

this ordinance, the number of exemptions claimed by each of them

 

when added together shall not exceed the total number of exemptions

 

allowed under this ordinance.

 

     (2) For tax years beginning after 1986, an An additional

 

exemption is allowed under subsection (1), upon passage of a

 

further ordinance, for a taxpayer who is 65 years of age or older,

 

or who is blind as defined in section 504 of the income tax act of

 

1967, Act No. 281 of the Public Acts of 1967, being section 206.504

 

of the Michigan Compiled Laws, 1967 PA 281, MCL 206.504, or if the

 

taxpayer is both 65 years of age or older and blind, 2 additional

 

exemptions are allowed under subsection (1). For tax years

 

beginning after 1987, upon Upon passage of a further ordinance, an

 

additional exemption is allowed under subsection (1) for a taxpayer

 

who is a paraplegic, quadriplegic, hemiplegic, or totally and

 

permanently disabled person as disability is defined in section 216

 

of title II of the social security act, 42 U.S.C. USC 416, or a

 

taxpayer who is a deaf person as defined in section 2 of the deaf

 

persons' interpreters act, Act No. 204 of the Public Acts of 1982,

 

being section 393.502 of the Michigan Compiled Laws. 1982 PA 204,

 

MCL 393.502. If the taxpayer qualifies for an additional exemption

 

under more than 1 of the following, an additional exemption is

 

allowed for each of the following for which the taxpayer qualifies:

 

     (a) A taxpayer who is a paraplegic, quadriplegic, or


hemiplegic, or who is a totally or permanently disabled person as

 

disability is defined in section 216 of title II of the social

 

security act, 42 U.S.C. USC 416.

 

     (b) A taxpayer who is blind as defined in section 504 of the

 

income tax act of 1967, Act No. 281 of the Public Acts of 1967,

 

being section 206.504 of the Michigan Compiled Laws.1967 PA 281,

 

MCL 206.504.

 

     (c) A taxpayer who is a deaf person as defined in section 2 of

 

the deaf persons' interpreters act, Act No. 204 of the Public Acts

 

of 1982, being section 393.502 of the Michigan Compiled Laws.1982

 

PA 204, MCL 393.502.

 

     (d) A taxpayer who is 65 years of age or older.

 

     (3) For tax years beginning after 1986 and upon Upon passage

 

of a further ordinance, a city, as determined by its governing

 

body, may provide for either an exemption from the tax levied under

 

this act if that person's adjusted gross income for that tax year

 

is less than a certain amount to be as specified by the ordinance,

 

or an exemption in an amount to be specified by the ordinance, for

 

a person with respect to whom a deduction under section 151 of the

 

internal revenue code part 1 of the income tax act of 1967, 1967 PA

 

281, MCL 206.1 to 206.532 is allowable to another federal taxpayer

 

during the tax year and is therefore not considered to have a

 

federal personal exemption under subsection (1).

 

     Sec. 44. Where total income, total deductions, net profits, or

 

other figures are derived from the taxpayer's federal income tax

 

return, any item of income not subject to the city income tax and

 

unallowable deductions shall be eliminated in determining net


income subject to the city tax. The fact that a taxpayer is not

 

required to file a federal income tax return does not relieve him

 

or her from filing a city tax return.

 

     Enacting section 1. This amendatory act does not take effect

 

unless all of the following bills of the 99th Legislature are

 

enacted into law:

 

     (a) Senate Bill No.____ or House Bill No. 5422 (request no.

 

04390'17).

 

     (b) Senate Bill No.____ or House Bill No. 5420 (request no.

 

05182'17 *).