Michigan Schedule of Recapture of Certain Business Tax Credits

Schedule of Recapture of Certain Business Tax Credits
4587, 2024 Michigan Business Tax Schedule of Recapture of Certain Business Tax Credits
Attachment 21

Michigan Department of Treasury
4587 (Rev. 04-24)

2024 MICHIGAN Business Tax Schedule of Recapture
of Certain Business Tax Credits and Deductions
Issued under authority of Public Act 36 of 2007.
Taxpayer Name

Federal Employer Identification Number (FEIN) or TR Number

Complete this schedule for any recapture in this tax year of previous tax credits and deductions listed on this schedule.
1. This recapture has expired. Leave this line blank and skip to line 2a ...................................................................
2. a. Recapture of Michigan Business Tax MEGA Employment Tax Credit..............................................................
b. This recapture has expired. Leave this line blank and skip to line 4................................................................
c. This recapture has expired. Leave this line blank and skip to line 4................................................................
3. This recapture has expired. Leave this line blank and skip to line 4 .....................................................................
4. Recapture of MEGA Federal Contract Credit.........................................................................................................
5. Recapture of MEGA Photovoltaic Technology Credit.............................................................................................
6. This recpature has expired. Leave this line blank and skip to line 7......................................................................
7. Recapture of MBT Brownfield Redevelopment Credit. Enter the amount from Form 4584, line 47.......................
8. Recapture of Film Infrastructure Credit

1.
2a.
2b.
2c.
3.
4.
5.
6.
7.

a. Enter all eligible depreciable tangible assets located in Michigan that were acquired in a tax year beginning after
December 31, 2007, and were sold or otherwise disposed of during the tax year. (Date format: MM-DD-YYYY)
A
B
C
D
E
Description

City

Date Acquired

Date Sold

b. Total columns E and F. A loss in column F will increase recapture............................

00

X X X X X X X X 00
X X X X X X X X 00
X X X X X X X X 00
00
00
X X X X X X X X 00
00

F

Gross Sales Price

Gain/Loss

8b.

c. Adjusted Proceeds. If line 8b, column F, is a gain, subtract line 8b, column F, from line 8b, column E.
If line 8b, column F, is a loss, add line 8b, column E and F...............................................................................

8c.

00

If taxable in another state, complete lines 8d and 8e; otherwise, skip to line 8f.
d. Apportioned gains (losses). Multiply line 8b, column F, by the percentage from Form 4567, line 11c..............

8d.

00

e. Apportioned Adjusted Proceeds. If line 8d is a gain, subtract line 8d from line 8b, column E.
If line 8d is a loss, add line 8d and line 8b, column E........................................................................................
f. Recapture of Film Infrastructure Credit. Multiply line 8c or line 8e by 25% (0.25)...........................................
9. Recapture of Anchor Company Payroll Credit........................................................................................................
10. Recapture of Anchor Company Taxable Value Credit............................................................................................
11. Recapture of Qualified Affordable Housing deductions..........................................................................................

8e.
8f.
9.
10.
11.

00
00
00
00
00

12. Recapture of Miscellaneous MEGA Battery Credits (for the recapture of the MEGA Battery Manufacturing Facility
Credit, MEGA Large Scale Battery Credit, and MEGA Advanced Lithium Ion Battery Credit; see instructions)
a. Total Recapture of Miscellaneous MEGA Battery Credits.................................................................................. 12a.
b. Battery Credit code....................................................................................... 12b.
c. Second Battery Credit code......................................................................... 12c.

00

13. Total Recapture of Certain Business Tax Credits and Deductions. Add lines 2a, 4, 5, 7, 8f, 9, 10, 11
and 12a. Carry amount to Form 4567, line 56, Form 4588, line 26, or Form 4590, line 29...................................

+

X X X X X X X X 00

0000 2024 81 01 27 0

13.

00

Instructions for Form 4587, Michigan Business Tax (MBT)
Schedule of Recapture of Certain Business Tax Credits and Deductions
Purpose
Complete this schedule for any recapture in this tax year of
previously claimed tax credits listed on this schedule. Recapture
of some tax credits occurs at the same point in the forms as
the credit is calculated. The credits on this form, however, are
required by statute to be recaptured at a later point in the tax
calculation process. This form is also used to report a required
recapture of an Affordable Housing Deduction.
Attachments in support of these recapture amounts are not
required. Maintain the recapture calculation information in
your files for review during audit.

Special Instructions for Unitary Business Groups
If any member of the Unitary Business Group (UBG) is
reporting recapture, a statement must be attached to this form
identifying the reporting member and the amount of recapture
for each applicable credit. If more than one member is
reporting recapture, requested information should be provided
in the statement on a per member basis. The total amount from
all reporting members will be entered on each corresponding
line on this form.

Line-by-Line Instructions
Lines not listed are explained on the form.
Dates must be in MM-DD-YYYY format.
Name and Account Number: Enter name and account number
as reported on page 1 of the applicable MBT annual return
(either the MBT Annual Return (Form 4567) for standard
taxpayers, the MBT Annual Return for Financial Institutions
(Form 4590), or the Insurance Company Annual Return for
Michigan Business and Retaliatory Taxes (Form 4588)).
UBGs: A UBG reporting recapture should include only
one copy of this form as part of its annual return. Enter the
Designated Member (DM) name in the Taxpayer Name
field and the DM account number in the Federal Employer
Identification Number (FEIN) field.
Line  1: The Research and Development Credit that is certified
by Michigan Economic Growth Authority (MEGA) is no
longer subject to recapture. Leave this line blank.
Line  2: If a taxpayer claims an MBT or Single Business Tax
(SBT) MEGA Employment Tax Credit or an SBT MEGA
Business Activity Credit for a previous tax period under an
agreement with MEGA based on qualified new jobs, and then
removes 51 percent or more of those qualified new jobs from
Michigan within three years after the first year in which the
taxpayer claims such a credit, the taxpayer must recapture an
amount equal to the total of all such credits claimed on prior
returns.
Line  2a: Enter the total amount of the MBT MEGA
Employment Tax Credit claimed on previously filed 4574 forms
subject to recapture.

Line  2b: The SBT MEGA Employment Tax Credit is no
longer subject to recapture. Leave this line blank.
Line  2c: The SBT MEGA Business Activity Credit is no
longer subject to recapture. Leave this line blank.
Line  3: The Entrepreneurial Credit is no longer subject to
recapture. Leave this line blank.
Line  4: Enter the total amount of MEGA Federal Contract
Credit claimed on previously filed MBT Election of Refund
or Carryforward of Credits forms (Form 4584) subject to
recapture.
NOTE: The MEGA Federal Contract Credit is claimed through
an agreement with MEGA. If a taxpayer claims this credit and
subsequently fails to meet requirements of the MBT Act or
conditions of the agreement, the taxpayer must recapture the
entire amount of such credit previously claimed.
Line 5: Enter the total amount of the MEGA Photovoltaic
Technology Credit claimed on previously filed 4574 forms
subject to recapture.
Line 6: The Biofuel Infrastructure Credit is no longer subject to
recapture.
Line  8: The Film Infrastructure Credit is available through an
agreement between the taxpayer and the Michigan Film Office,
with the concurrence of the State Treasurer. The credit amount
is up to 25 percent of the base investment expenditures in a
qualified film and digital media infrastructure project. If the
taxpayer sells or otherwise disposes of a tangible asset that was
paid for or accrued after December 31, 2007, and whose cost
is included in the base investment, the taxpayer must report
recapture equal to 25 percent of the gross proceeds or benefit
from the sale or disposition, adjusted by the apportioned gain
or loss.
NOTE: A sale of qualifying property reported on the
installment method for federal income tax purposes causes
recapture of the entire gross proceeds (including the amount of
the note) in the year of sale, less any gain reflected in federal
taxable income (as defined for MBT purposes) in the year of
the sale. In each subsequent year of the installment note, enter
zero in line 8a, column E, and enter the gain reflected in federal
taxable income (as defined for MBT purposes) in column
F. For property placed in service prior to January 1, 2008,
gain reflected in federal taxable income (as defined for MBT
purposes) is equal to the gain reported for federal purposes.
Line  8a: Enter all dispositions of depreciable tangible assets
included in base investment expenditures that were paid or
accrued after December 31, 2007, and were sold or otherwise
disposed of during the tax year.
•	 Columns  A through D: Enter a brief description of the
asset, the city or township in which the asset is located, and
the dates that the asset was paid for or accrued and disposed
of or sold. To list multiple disposition as one entry, the
date the assets were acquired and sold must be the same;
dispositions with variable dates must be listed separately.

145

•	 Column  E: Enter the total gross proceeds from the sale or
disposition of depreciable tangible assets listed in column A.
•	 Column  F: Enter total gain or loss included in calculating
federal taxable income (as defined for MBT purposes).

eligible battery credits, enter the appropriate two-digit code
from the list below in line 12b. If reporting recapture for two
credits, enter the appropriate code for one of the recaptured
credits on line 12b, and the other on line 12c.

Lines 9-10: NOTE: The Anchor Company Payroll Credit
and the Anchor Company Taxable Value Credit are claimed
through an agreement with MEGA. If a taxpayer claimed one
of these credits and subsequently fails to meet requirements of
the MBT Act or conditions of the agreement, the taxpayer must
recapture the entire amount of such credit previously claimed.

Miscellaneous MEGA Battery Credit Codes

Line  9: Enter the total amount of the Anchor Company Payroll
Credit claimed on previously filed 4584 forms subject to
recapture.
Line 10: Enter the total amount of the Anchor Company
Taxable Value Credit claimed on previously filed 4584 forms
subject to recapture.
Line  11: Under Michigan Compiled Laws 208.1201(6), the
seller of residential rental units may take a deduction from its
Business Income Tax base, after apportionment, of the gain
from the sale of the residential rental units to a buyer who is a
Qualified Affordable Housing Project (QAHP). To qualify for
a deduction, the seller and buyer must enter into an “operation
agreement” in which the buyer agrees to operate a specific
number of the residential rental units sold as rent restricted
units for a minimum of 15 years. The Department of Treasury
(Treasury) will record a lien against the property subject to
the operation agreement, to enforce the possibility of future
recapture of this deduction.
When the buyer fails to qualify as a QAHP or fails to operate
any of the residential rental units as rent restricted units in
accordance with the operation agreement within 15 years after
the date of purchase, the lien recorded by Treasury becomes
payable to the State. Failure to operate even one residential rental
unit in accordance with an operation agreement constitutes
failure to operate all or some of the residential rental units as rent
restricted units in accordance with the operation agreement, and
therefore is a recapture event. The lien is payable in the year the
recapture event occurs. This recapture is mandatory even if a
taxpayer is otherwise not required to file a return because it does
not meet the filing threshold of $350,000.
Enter a recapture amount equal to the full amount of the
deduction allowed to the seller multiplied by a fraction, the
numerator of which is the difference between 15 and the years
the affordable housing project qualified and complied with the
terms of the agreement and the denominator of which is 15.
Line 12 NOTE: There are three different MEGA battery
credits that are eligible for recapture and are reported on this
line. If the taxpayer has more than one of these credits, enter
the combined amount of those credits on line 12a.
Line 12a: Enter the total amount of the MEGA Battery
Manufacturing Facility Credit, MEGA Large Scale Battery
Credit and MEGA Advanced Lithium Ion Battery Credit
deemed to be added back to the tax liability by the Michigan
Economic Growth Authority.
Line 12b-c: If reporting recapture for only one of the three

146

	 CREDIT	CODE
MEGA Battery Manufacturing Facility Credit...................11
MEGA Large Scale Battery Credit.................................... 12
MEGA Advanced Lithium Ion Battery Credit................... 13
Line  13: Add lines 1, 2a, 3, 4, 5, 7, 8f, 9, 10, 11, and 12a.
Standard taxpayers carry this amount to Form 4567, line 56.
Insurance companies carry this amount to the Form 4588, line
26. Financial Institutions carry this amount to the Form 4590,
line 29.
Include completed Form 4587 as part of the tax return filing.