February 5, 2013, Introduced by Reps. Schor, Brown, Singh, Irwin, Switalski, Knezek, Slavens and Cavanagh and referred to the Committee on Tax Policy.
A bill to amend 1967 PA 281, entitled
"Income tax act of 1967,"
(MCL 206.1 to 206.713) by adding sections 275 and 675.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 275. (1) Beginning on and after January 1, 2013, a
qualified taxpayer may claim a credit against the tax imposed by
this part equal to 50% of the amount paid on a qualified student
loan by the qualified taxpayer during the tax year. A qualified
taxpayer shall not claim a credit of more than 20% of the average
yearly tuition for Michigan's public universities under this
section for any single tax year.
(2) To be eligible for the credit under this section, the
qualified taxpayer shall provide the department with proof of
residency and proof of employment in this state. The department may
also require reasonable proof from the qualified taxpayer in
support of payments claimed to be paid for a qualified student loan
under this section.
(3) If the credit allowed under this section exceeds the
qualified taxpayer's tax liability for the tax year, that portion
that exceeds the tax liability for the tax year shall be refunded.
(4) As used in this section:
(a) "Approved postsecondary educational institution" means any
of the following:
(i) A college, university, community college, or junior college
described in section 4, 5, or 6 of article VIII of the state
constitution of 1963 or established under section 7 of article VIII
of the state constitution of 1963.
(ii) An independent nonprofit college or university located in
this state.
(b) "Proof of residency" means a filed Michigan individual
income tax return that includes the taxpayer's certification that
he or she is a resident, a signed affidavit of Michigan residency,
or other proof of residency acceptable to the department.
(c) "Qualified student loan" means any state or federal loans
incurred to attend and receive a bachelor's degree from an approved
postsecondary educational institution, including, but not limited
to, state loans authorized under the higher education loan
authority act, 1975 PA 222, MCL 390.1151 to 390.1165, and federal
loans authorized under the higher education act of 1965, Public Law
89-329, 20 USC 1001 to 1155.
(d) "Qualified taxpayer" means a taxpayer who attended an
approved postsecondary educational institution and received a
bachelor's degree from that institution, who is a resident of this
state, and who is employed in this state.
Sec. 675. (1) Beginning on and after January 1, 2013, a
taxpayer may claim a credit against the tax imposed by this part
equal to 50% of the amount of qualified student loan payments made
by the taxpayer on behalf of a qualified employee during tax year
for which the credit is claimed or 20% of the average yearly
tuition for Michigan's public universities per employee, whichever
is less.
(2) To be eligible for the credit under this section, the
taxpayer in a form as prescribed by the department shall provide
reasonable proof in support of payments claimed to be paid on
behalf of a qualified employee for his or her qualified student
loan under this section. The form shall include, at a minimum, all
of the following:
(a) The taxpayer's federal employer identification number or
the Michigan treasury number assigned.
(b) The name and address of the qualified employee.
(c) The date and amount of each payment made toward a
qualified student loan.
(d) Any other criteria that the department considers
appropriate for the determination of eligibility for the credit
under this section.
(3) If the amount of the credit allowed under this section
exceeds the tax liability of the taxpayer for the tax year, that
portion of the credit that exceeds the tax liability of the
taxpayer for the tax year shall not be refunded but may be carried
forward to offset tax liability under this act in subsequent tax
years for a period not to exceed 10 tax years or until used up,
whichever occurs first.
(4) As used in this section:
(a) "Approved postsecondary educational institution" means any
of the following:
(i) A college, university, community college, or junior college
described in section 4, 5, or 6 of article VIII of the state
constitution of 1963 or established under section 7 of article VIII
of the state constitution of 1963.
(ii) An independent nonprofit college or university located in
this state.
(b) "Qualified employee" means an employee who attended an
approved postsecondary educational institution and received a
bachelor's degree from that institution and who is a resident of
this state.
(c) "Qualified student loan" means any state or federal loans
incurred to attend and receive a bachelor's degree from an approved
postsecondary educational institution, including, but not limited
to, state loans authorized under the higher education loan
authority act, 1975 PA 222, MCL 390.1151 to 390.1165, and federal
loans authorized under the higher education act of 1965, Public Law
89-329, 20 USC 1001 to 1161aa-1.