Job Creation Tax Credits
Michigan Economic Growth Authority (MEGA) job creation tax credits - If you need a reason to expand or locate in Michigan rather than another state, you may be eligible for a high-tech job creation tax credit against the Michigan Business Tax (MBT). Each credit may be awarded for up to 20 years and for up to 100% of the tax related to the project.
Property Tax Abatements
Industrial property tax abatements (PA 198) are used to spur renovation and expansion of aging manufacturing plants and new plant construction. They have recently been extended to high-tech companies. Abatements are approved by the local units of government and issued by the state, reducing property tax on buildings, machinery and equipment by roughly 50% for new facilities and 100% for renovation projects. They are available for up to 12 years everywhere in the state. Public Act 328 - allows for 100% personal property tax exemption in the Cities of Muskegon and Muskegon Heights in order to spur development in these core communities.
Job Training Grants
Michigan's Economic Development Job Training Program provides grants each year to companies for training or retraining of workers to meet marketplace needs, with the employer required to match 25% of the state grant for training of existing workers. Funds are awarded through a competitive process. The employer works with private or public education providers to design the training.
21st Century Jobs Fund
A $2 billion, ten-year initiative proposed by Governor Granholm, approved by the Michigan Legislature, and administered by the Michigan Economic Development Corporation (MEDC) to accelerate the diversification of Michigan’s economy. Funds are awarded through a competitive process.
Michigan's brownfield law is designed to encourage and assist developers who want to return property to productive use more quickly and at a lower cost than before, while still protecting human health and natural resources. Owners and operators of contaminated sites are no longer required to pay for cleanup actions unless they caused the contamination. Flexible cleanup standards give developers the option of proposing a solution to historical contamination based on future use of the property. Michigan now allows qualified businesses to claim a credit against the Michigan Business Tax (MBT), provided the taxpayer has a pre-approved letter issued between December 31, 1999 and January 1, 2003 and the project is completed not more than five years after the letter is issued. If the total of all credits for the project is $1 million or less, the credit is based on 10% of the eligible investment. If the total of all credits for the project is greater than $1 million but not more than $30 million, a credit is available for a percentage of eligible investment to be determined by the Michigan Economic Growth Authority (MEGA), but not to exceed 10% of the eligible investment. Certain location restrictions apply to these credits .
These are areas in the cities of Muskegon and Muskegon Heights designated as virtually tax free for any business or resident presently in, or moving into, a zone. The taxes that companies and residents do not pay comprise nearly all the state and local taxes levied on business activity: Michigan Business Tax (MBT), state personal income tax, six-mill state education tax, local personal property tax, local real property tax, local income tax and utility users tax. The duration of the zone designation is fourteen years, starting from 1999. The tax relief will be phased out in 25% increments over the last three years of the program.
The goal is to stimulate the growth of technology-based businesses and jobs by creating recognized clusters of technological businesses and research institutions throughout the state. This innovative program allows municipalities to use tax increment financing for property acquisition, infrastructure, business incubators and other park facilities, management, and marketing.