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Michigan: Insurance Affiliates Qualifying as Unitary Business Group Cannot File a Combined Return
Docket No. 21-000039, Mich. Tax Trib. (1/23/23). In a case involving affiliated insurance companies that met Michigan’s corporate income tax statutory requirements for qualifying as a “unitary business group” (UBG), the Michigan Tax Tribunal (Tribunal) held summary judgment for the Michigan Department of Treasury that pursuant to other applicable Michigan statutes, the affiliates are not permitted to file as a UBG for Michigan premiums and retaliatory taxes and thus may not “reap the benefits of” claiming certain Michigan insurance-related (“MAIPF”) tax credits on a combined tax return. Specifically, the Tribunal explained that although Michigan Compiled Laws 206.691 requires UBGs to file combined returns for taxpayers subject to a corporate income tax base in Michigan, it does not require UBGs to file combined returns for Michigan premiums and retaliatory taxes – thus illustrating that the Michigan Legislature “did not intend to have premiums tax calculated on a group wide basis.” Please contact us with any questions.
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