October 12, 2017, Introduced by Rep. Kahle and referred to the Committee on Tax Policy.
A bill to amend 1967 PA 281, entitled
"Income tax act of 1967,"
by amending section 711 (MCL 206.711), as amended by 2016 PA 158.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 711. (1) Every person required by this part to deduct and
withhold taxes for a tax year on income other than distributive
share of income from a flow-through entity shall furnish to the
person who received the income a statement in duplicate on or
before January 31 of the succeeding year of the total income paid
during the tax year and the amount deducted or withheld. However,
if employment is terminated before the close of a calendar year by
a person that goes out of business or permanently ceases to exist,
then the statement required by this subsection shall be issued
within 30 days after the last compensation, winnings, or payoff of
a winning ticket is paid. A duplicate of a statement made pursuant
to this section and an annual reconciliation return, MI-W3, shall
be
filed with the department by February 28 January 31 of the
succeeding year except that a person that goes out of business or
permanently ceases to exist shall file the statement and the annual
reconciliation return within 30 days after going out of business or
permanently ceasing to exist. For tax years that begin before July
1, 2016, a flow-through entity that was required to withhold taxes
on distributive shares of business income shall file an annual
reconciliation return with the department no later than the last
day of the second month following the end of the flow-through
entity's federal tax year. The department may require a flow-
through entity to file an annual business income information return
with the department on the due date, including extensions, of its
annual federal information return.
(2) Every person required by this part to deduct or withhold
taxes shall make a return or report in form and content and at
times as prescribed by the department. The department may require
certain employers to make the return or report required under this
section in electronic form. An employer that has entered into an
agreement with a community college pursuant to chapter 13 of the
community college act of 1966, 1966 PA 331, MCL 389.161 to 389.166,
and is required to deduct or withhold taxes from compensation and
make payments to a community college pursuant to the agreement for
a portion of those taxes withheld shall, for as long as the
agreement remains in effect, delineate in the return or report
required under this subsection between the amount deducted or
withheld and paid to the state and that amount paid to a community
college.
(3) Every person who receives income subject to withholding
under this part shall furnish to the person required by this part
to deduct and withhold taxes information required to make an
accurate withholding. A person who receives income subject to
withholding under this part shall file with the person required by
this part to deduct and withhold taxes revised information within
10 days after a decrease in the number of exemptions or a change in
status from a nonresident to a resident. The person who receives
income subject to withholding under this part may file revised
information when the number of exemptions increases or when a
change in status occurs from that of a resident of this state to a
nonresident of this state. Revised information shall not be given
retroactive effect for withholding purposes. A person required by
this part to deduct and withhold taxes shall rely on this
information for withholding purposes unless directed by the
department to withhold on some other basis. If a person who
receives income subject to withholding under this part fails or
refuses to furnish information, the person required by this part to
deduct and withhold taxes shall withhold at the full rate of tax
from the person's income subject to withholding under this part.