MI HB6545

Modifies the definition of "federal taxable income" to exclude Internal Revenue Code sections 163(j) (interest deduction limitations), 168(k) (bonus depreciation), and 199 (domestic production activities deduction) when calculating Michigan's corporate income tax base.

Adds new definitions including "flow-through entity" (S-corporations, partnerships, trusts, LLCs not taxed as corporations federally) and "foreign operating entity" (U.S. corporations with substantial foreign operations and at least 80% active foreign business income).

Expands the definition of "gross receipts" with specific exclusions for agency transactions, pass-through costs, capital assets, property transfers, and certain financial instruments, plus similar carve-outs for advertising agencies and property managers.

Requires taxpayers with ownership interests in flow-through entities conducting Michigan business to pay the 6% corporate income tax unless prohibited by federal law, expanding tax liability beyond traditional corporate structures.

Makes the amendments retroactively effective January 1, 2018, applying to all business activity after December 31, 2017.