HOUSE BILL NO. 4937

September 05, 2023, Introduced by Reps. Martus, Skaggs and Snyder 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 206.847) by adding section 677.

the people of the state of michigan enact:

Sec. 677. (1) For tax years beginning on and after January 1, 2024 and subject to the limitations under this section, a 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 taxpayer on behalf of a qualified employee who either graduated from a high school located in this state or received a bachelor's, master's, or other higher graduate degree from a postsecondary educational institution located in this state and remained in, or relocated to, this state for employment with that taxpayer after obtaining a bachelor's, master's, or other higher graduate degree from a postsecondary educational institution, during the tax year.

(2) A taxpayer shall not claim a credit under this section for payments made on a qualified student loan on behalf of any single qualified employee for any single tax year equal to more than 20% of the average yearly tuition to attend a public university located in this state.

(3) 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 that qualified employee's 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, address, and graduation date 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.

(4) 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.

(5) The credit allowed under this section may be referred to as the "make it in Michigan credit".

(6) As used in this section and 677a:

(a) "Postsecondary educational institution" means a college, university, community college, or junior college that grants bachelor's, master's, or other higher graduate degrees.

(b) "Qualified employee" means an employee who is a resident of this state and who received a bachelor's, master's, or other higher graduate degree from a postsecondary educational institution after the effective date of the amendatory act that added this section.

(c) "Qualified student loan" means any state or federal loans incurred by a qualified employee to attend and receive a degree from a 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.

(d) "Resident" means an individual who is domiciled in this state for at least the 365 days immediately preceding the last day of the fourth month after the end of the taxpayer's tax year for which a credit is being claimed under this section.

Enacting section 1. This amendatory act does not take effect unless all of the following bills of the 102nd Legislature are enacted into law:

(a) Senate Bill No.____ or House Bill No. 4933 (request no. 00575'23).

(b) Senate Bill No.____ or House Bill No.____ (request no. 03968'23).

(c) Senate Bill No.____ or House Bill No. 4936 (request no. 04009'23).