MI HB5729

Changes Michigan income tax rate from 4.35% (effective October 1, 2007) to a gradually declining rate schedule: 4.2% (2013-2014), 4.15% (2014-2015), 4.1% (2015-2016), 4.0% (2016-2017), 3.95% (2017-2018), and 3.9% (2018 onward).

Applies revised rates to taxable income of residents, nonresidents, individuals, partners, beneficiaries of trusts and estates, and trusts and estates (excluding corporations).

Maintains existing provisions requiring a percentage of gross income tax collections to be deposited into the state school aid fund, calculated as 1.012% divided by the applicable income tax rate beginning January 1, 2000.

Requires the Department of Treasury to annualize tax rates for tax years ending after April 30, 1994 when rates change mid-year.

Preserves tax credit provisions for resident beneficiaries of trusts receiving accumulation distributions and maintains income computation rules based on the Internal Revenue Code.