4585: Investment Tax Credit Recapture from Sale of Assets Acquired Under Single Business Tax (2024)
Michigan · Michigan Treasury · Used for tax years 2024
Michigan Form 4585 calculates Investment Tax Credit recapture for the disposition or transfer of tangible, depreciable property acquired in tax years beginning after 1999 and before 2008. It reports recapture bases, rates and amounts and supports the total recapture reported on F
Who files this form
File Form 4585 when you must recapture Investment Tax Credit (ITC) for qualifying property acquired under the Single Business Tax (SBT). It supports the total recapture reported on Form 4570.
- The form generally covers dispositions or transfers of tangible, depreciable real or personal property acquired in tax years beginning after 1999 and before 2008.
- Line 3 also covers qualifying nonmobile depreciable tangible assets acquired in tax years beginning after 1996 and before 2008, eligible for ITC in tax years beginning after 1999 and before 2008, and transferred outside Michigan during the tax year.
- Recapture is mandatory even if you otherwise do not have to file because you do not meet the $350,000 filing threshold.
- A unitary business group (UBG) must complete a separate form for each member that disposed of capital assets triggering SBT ITC recapture.
What you'll need
Gather the records that apply to your assets and chosen calculation method:
- Form 4567: Your name and account number from page 1, and the apportionment percentage from line 11c.
- Asset worksheets: Acquisition tax-year end dates, gross proceeds, and gains or losses for disposed assets. For qualifying assets transferred outside Michigan, gather adjusted federal basis information. Keep separate asset worksheets in your files and report totals grouped by acquisition year.
- Prior Forms C-8000ITC: The historical credit and investment figures required by your calculation method. Method B requires all such forms for tax years beginning on or after January 1, 2000, using amended figures where applicable.
- Forms 4569 for applicable periods ending in 2008 or 2009: Needed for the carryforward-used calculation under Method B.
- Form 4570 and its Worksheet 2, if applicable: Needed to report the combined recapture amount.
For Method C, retain records supporting your own calculation.
How to file
Include completed Form 4585 as part of your tax return filing. It is a supporting form for the recapture amount reported on Form 4570.
Carry the total from Form 4585, line 7, to Form 4570, line 19. If assets purchased in MBT years were also disposed of or transferred outside Michigan this year, first add the total from Form 4570's Worksheet 2, column U.
The supplied text does not provide a mailing address or e-file directions.
Common mistakes
- Entering cents: Report whole dollars. Round down amounts of 49 cents or less and round up amounts of 50 cents or more. Cents entered on the form will be treated as whole dollars.
- Skipping recapture because you are below the filing threshold: Recapture is still mandatory.
- Counting installment-sale proceeds again: The entire sale price is reported for recapture in the year of sale. Do not report later installment payments again as gross proceeds. Report the applicable gain in column C of line 1 or line 2.
- Using a recapture rate above the limit: No method may produce an effective annual recapture rate higher than Method A's rate for that year.
- Using group information for years a member filed separately: For those years, use the member's own filing information, not the group's.
Questions people ask
How should I organize the assets?
Group assets by acquisition tax year, using one row per year within the applicable asset category. List the oldest year first and enter tax-year end dates in MM-DD-YYYY format.
Which apportionment percentage should I use?
Use Form 4567, line 11c, for line 1, column D, and line 2, column E. Use the same percentage for each completed row. For line 1, enter 100 percent if you are not apportioning.
What are the three recapture-rate methods?
Method A is the simplest but does not account for how much credit was used. Method B accounts for credit use and requires Table I and the Treasury webtool at www.michigan.gov/mbt4585tool. Method C uses your own calculation reflecting the MBT statute, with supporting records retained.
How does a UBG identify the member on this form?
Enter the Designated Member's name in the Taxpayer Name field and the reporting member's name on the line below. If reporting the Designated Member's own data, enter its name and account number on both lines.