Michigan House Bill HB5292

Michigan 2025-2026 Regular Session

• Introduced: 11/13/25
• Refer: 11/13/25

Caption

Corporate income tax: credits; ability to claim certain certificated credits against corporate income tax liability; provide for, and repeal Michigan business tax act. Amends secs. 605 & 680 of 1967 PA 281 (MCL 206.605 & 206.680); adds sec. 670 & repeals 2007 PA 36 (MCL 208.1101 - 208.1519). TIE BAR WITH: HB 5293'25

Summary

HB 5292 would amend Michigan’s Income Tax Act to create a new mechanism for certain legacy “certificated credits” tied to older Michigan business tax incentives. The bill defines which pre-2012 credits qualify and adds a new section allowing taxpayers to claim any remaining amount of those credits against corporate income tax liability for tax years beginning on or after January 1, 2026 and before January 1, 2036. The credits would generally be taken in equal installments over 10 years, starting in 2026, and any amount exceeding a taxpayer’s liability would be refundable. The bill also conditions continued eligibility on employment retention. A taxpayer would lose the ability to claim the credit for a tax year, and any later tax year, if it fails to maintain at least 95% of the full-time jobs it had in Michigan on September 30, 2025. The Department of Treasury could require proof of the number of jobs maintained. The bill defines “full-time job” as one worked at least 35 hours per week by an individual whose income and Social Security taxes are withheld by the taxpayer, an employee leasing company, or a professional employer organization. In addition, HB 5292 revises existing provisions in section 680 governing elections related to certificated credits under the former Michigan Business Tax Act. Those provisions would continue to allow certain taxpayers with unused certificated credits to elect to pay the Michigan Business Tax instead of the corporate income tax in specified circumstances, with references extended through December 31, 2025. The bill also includes an enacting section repealing the Michigan Business Tax Act effective for tax years beginning after December 31, 2025. The bill’s practical impact is to preserve and phase out the use of older economic-development tax credits during the transition away from the Michigan Business Tax system, while shifting their remaining value into the corporate income tax framework. It affects corporations holding qualifying legacy credits, especially businesses that entered into pre-2012 agreements with the Michigan Economic Growth Authority or related programs, and it gives Treasury enforcement authority over job-maintenance compliance. The bill is tie-barred to HB 5293, meaning it would not take effect unless that companion bill is also enacted. No committee transcript or vote history was provided, so there is no recorded legislative debate or roll-call sentiment in the materials supplied. Based on the bill text alone, the measure appears technical and transitional rather than controversial on its face, but it does impose a job-retention شرط that could be a point of concern for credit holders. The main policy tension is between honoring legacy incentive commitments and ensuring those credits continue only if the recipient maintains a substantial Michigan employment footprint.

Impact

HB 5292 would amend MCL 206.605 and add new MCL 206.670 in the Income Tax Act, while also revising MCL 206.680 to preserve limited election rights tied to legacy Michigan Business Tax certificated credits through the end of 2025. It would create a new refundable corporate income tax credit mechanism for certain pre-2012 certificated credits beginning in tax year 2026, and it would repeal the Michigan Business Tax Act for tax years beginning after December 31, 2025. The bill primarily affects corporations holding qualifying legacy economic-development credits and gives the Department of Treasury authority to verify job-maintenance compliance.

Sentiment

No committee discussion or voting record was provided, so there is no direct evidence of support or opposition from legislators in the supplied materials. On its face, the bill appears to be a transitional tax measure designed to honor existing credit commitments while winding down the old business tax regime. The overall tone of the bill is administrative and implementation-focused, with a policy emphasis on continuity and phase-out rather than expansion of new incentives.

Contention

The main point of potential contention is the bill’s job-retention شرط: taxpayers must maintain at least 95% of the full-time jobs they had in Michigan on September 30, 2025 or lose eligibility for the credit in that year and future years. Businesses holding the credits may view this as a significant compliance burden or a risk to the value of the credit, while supporters may see it as a safeguard to ensure the credits continue to support Michigan employment. Another possible issue is the long tail of legacy tax incentives and whether the state should continue honoring older agreements through a new corporate income tax mechanism.