Michigan House Bill HB4128

Michigan 2025-2026 Regular Session

• Introduced: 2/25/25
• Refer: 2/25/25
• Report Pass: 3/25/25
• Engrossed: 10/28/25
• Refer: 10/30/25

Caption

House Bill 4128 of 2025

Summary

HB4128 would amend Michigan’s Income Tax Act to create a corporate income tax credit for electricity generated at qualifying nuclear facilities using small modular reactors, an extended power uprate, or a stretch power uprate. The credit is calculated at $1 per kilowatt-hour of electricity produced and sold to an unrelated person during the tax year. The bill is aimed at existing nuclear facilities and advanced nuclear reactor facilities owned by the taxpayer, and it defines the eligible technologies and facility types by reference to federal nuclear law and Nuclear Regulatory Commission approvals. The credit is limited in several ways. A taxpayer may claim it only during the first 10 years of operation after the relevant reactor or uprate is placed in service, and only for the first 10,000 megawatt hours produced by a single qualified facility. The Department of Treasury may require documentation to verify eligibility and production amounts. If the credit exceeds the taxpayer’s liability, the excess is not refundable, but it may be carried forward for up to 15 years or until used. The bill is tie-barred to several companion bills, meaning it would not take effect unless the related package of bills is also enacted.

Impact

If enacted, HB4128 would add a new business tax incentive to Michigan law by creating section 678 of the Income Tax Act of 1967. It would reduce corporate income tax liability for qualifying nuclear power generation, potentially benefiting owners and operators of eligible nuclear facilities, including those investing in small modular reactors or plant uprates. The bill would also give the Department of Treasury authority to verify claims and would establish a new statutory framework for defining advanced nuclear reactor facilities and related technologies for tax purposes.

Sentiment

The voting history suggests the bill package had meaningful support, though not unanimous. The committee reported the substitute favorably by a 13-2 vote, and the House later gave the bill immediate effect by a 78-26 roll call. That pattern indicates broad but not universal backing for using tax policy to encourage nuclear generation and advanced reactor investment.

Contention

The main points of contention likely center on the use of tax credits to support nuclear power, the size and structure of the incentive, and whether the state should subsidize a narrow set of facilities and technologies. Critics may view the credit as a targeted corporate tax break with uncertain fiscal cost, while supporters likely argue it promotes energy reliability, advanced nuclear development, and investment in low-carbon generation. The bill’s tight eligibility rules, production cap, and time limit suggest an effort to balance those concerns.