4570: Credits for Compensation, Investment, and Research and Development (2024)
Michigan · Michigan Treasury · Used for tax years 2024
Michigan Form 4570 calculates the 2024 Michigan Business Tax credits for compensation, investment, and research and development. It reports Michigan compensation, eligible capital investments and recapture amounts, and research and development expenses in Michigan to determine al
Who files this form
Use 2024 Form 4570 to calculate eligible Michigan Business Tax (MBT) credits for compensation, investment, and research and development, and any Investment Tax Credit recapture.
- Standard taxpayers may use this form to claim eligible credits. Taxpayers making a valid certificated credit election may also claim these credits.
- Financial institutions may claim only the Compensation Credit on this form.
- Insurance companies use Form 4596 for credits for which they may qualify.
- The Investment Tax Credit instructions require this form with the annual return if, during the filing period, you acquired depreciable real or personal property or disposed of such property acquired in a tax year beginning after 1999.
- A unitary business group (UBG) completes one Form 4570 for the group.
What you'll need
Have the following information and forms available, as applicable:
- Your MBT annual return: Form 4567 for standard taxpayers or Form 4590 for financial institutions. Use the same taxpayer name and account number shown on that return.
- Form 4568, MBT Nonrefundable Credits Summary: Form 4570 uses the tax liability from this form and sends calculated credit amounts back to it.
- Michigan compensation records: Include qualifying wages, benefits, and net earnings from self-employment.
- Asset records: Descriptions, locations, acquisition and transfer dates, costs paid or accrued, federal adjusted basis, sale dates, sales prices, and gains or losses, as required by the applicable tables.
- Michigan research and development expense information: Use expenses as defined in Internal Revenue Code section 41(b).
- Recapture forms and prior-year information: Worksheets 1a through 1c and Worksheet 2 apply to qualifying assets from earlier tax years. Worksheet 2 requires information from the acquisition-year Forms 4570. Form 4585 is also required for applicable dispositions of property acquired in tax years beginning after 1999 and before 2008.
How to file
Include completed Form 4570 as part of your tax return filing. The supplied text does not provide a mailing address or e-file directions.
For the Investment Tax Credit, complete Tables 1 through 6 before completing lines 4 through 16. If you need more room for assets, include additional copies of page 3 or page 4, as applicable. Put your name and account number at the top and complete only the additional applicable fields.
Carry the allowable Compensation and Investment Tax Credits from line 26 to Form 4568, line 4a. Carry the Research and Development Credit from line 33 to Form 4568, line 5. If line 20 is negative, carry that amount to Form 4568, line 4b.
Common mistakes
- Using line 9 in a calculation: Line 9 is for statistical purposes only. Do not use it in any calculation on this form.
- Entering “Various” for dates: Use MM-DD-YYYY. List events with different dates separately. Combined entries must meet the table's requirements and have matching applicable dates.
- Entering unnecessary zeros in Tables 1 through 6: Leave lines or boxes blank when they do not apply or the amount is zero, unless instructed otherwise.
- Using the wrong recapture tables: Tables 4 through 6 cover applicable assets acquired or moved into Michigan and disposed of or moved out during the same filing period. Use the worksheets for applicable assets from a previous tax year beginning after December 31, 2007.
- Spreading installment-sale recapture over the payment period: The printed reminder says recapture is based on the entire sale price in the year of sale, reduced by the applicable gain reported that year.
Questions people ask
How is the Compensation Credit calculated?
Multiply Michigan compensation on line 2 by 0.37%. The credit is subject to the combined limit for the Compensation and Investment Tax Credits.
What limits apply to these credits?
The Compensation Credit and Investment Tax Credit together are limited to 52% of total tax liability. Those two credits combined with the Research and Development Credit are limited to 65% of tax liability.
Can investment credit recapture increase my tax?
Yes. Disposing of an asset or moving it out of Michigan can create recapture that reduces the credit. If recapture exceeds the positive credit earned through acquisitions, tax liability increases.
How is the Research and Development Credit calculated?
Line 30 multiplies qualifying Michigan research and development expenses by 1.9%. Line 33 allows the lesser of that amount or the remaining credit ceiling calculated on line 32.