HB 4186 increases Michigan's business income tax rate from 4.95% to 30% for all business activity occurring on or after January 1, 2025. This rate change directly affects businesses operating within Michigan that are subject to the state's business tax, including those previously filing under the corporate income tax act. The bill amends sections 201 and 500 of the Michigan Business Tax Act (2007 PA 36) to implement this rate increase and adjust the tax base calculations for businesses. The change represents a significant policy shift in how Michigan taxes business income, effective in 2025.
HB 4230 creates a new "neighborhood road fund" in Michigan's state treasury, funded by $100 million annually from income tax revenues (specifically from Section 695 of the 1967 Income Tax Act). This fund directly affects county road commissions, city and village road agencies, and the local bridge advisory board. Key provisions require $100 million yearly to be reserved exclusively for repairing closed, restricted, and critical bridges (managed by the advisory board), while the remaining funds are distributed to road agencies based on their road mileage - $100,000 per county commission plus a mileage-based share for all counties, and similarly for cities/villages. The bill specifies these funds must cover road preservation, maintenance, and preventative work without requiring local matching funds.
HB 4170 permanently sets Michigan's individual income tax rate at 4.05% for all taxpayers, replacing a temporary 4.25% rate scheduled to take effect in 2024. It creates a mechanism where the rate could decrease further if state revenue growth exceeds inflation, requiring annual revenue reviews. The bill directly affects all Michigan residents who pay individual income tax. The change takes effect immediately for tax years beginning January 1, 2025, with the 4.05% rate now permanent unless triggered by the revenue growth condition.
HB 4014 exempts certain family transfers of residential property from a rule that normally resets property taxes to current market value after a sale or transfer. It specifically applies when property is transferred to close family members (such as parents, children, or siblings) through trusts, wills, or inheritances, provided the property isn't used commercially afterward. To qualify, beneficiaries must provide proof of their relationship within 30 days, or face a $200 fine. The bill modifies Michigan’s property tax law to prevent "taxable value" adjustments that would otherwise increase annual property tax bills significantly for these transfers.
HB 4162 allocates $17.77 billion in state and federal funds for Michigan's K-12 public schools for the 2025-2026 fiscal year, primarily from the state school aid fund and other designated trust funds. It sets a new target per-student funding level of $10,025 and establishes a formula to calculate each school district's foundation allowance based on the previous year's funding, inflation (using the Consumer Price Index), and the target amount. School districts with funding below the target receive adjusted increases, while those above the target see smaller raises tied to inflation. The bill directly affects all public school districts by determining their state funding allocation through this updated formula.
