4896: Unitary Business Group (UBG) Affiliates Excluded from the Return of Standard Taxpayers* (2024)
Michigan · Michigan Treasury · Used for tax years 2024
Michigan Form 4896 identifies affiliates excluded from a standard taxpayer’s 2024 Corporate Income Tax combined return. It lists each entity’s name, FEIN, reason for exclusion, Michigan nexus status, and NAICS code.
Who files this form
Use 2024 Form 4896 to identify affiliates excluded from a Michigan Unitary Business Group’s (UBG’s) combined standard return.
List every C corporation (or entity taxed federally as one), insurance company, and financial institution that meets the UBG ownership test, or belongs to a group covered by an Affiliated Group Election for the tax year, but is not included in the combined standard return. Include these entities whether or not they have nexus with Michigan.
Also list a member whose business activity is excluded from the current combined return because its tax year ends after the UBG’s filing period.
What you'll need
Have the following information ready:
- The Designated Member’s name and Federal Employer Identification Number (FEIN).
- Each excluded entity’s name, FEIN, exclusion reason code, Michigan nexus status, and six-digit NAICS code.
- Each entity’s “Corp. No.” from federal Form 851, if applicable.
Attach a copy of federal Form 851 if any listed entity is a member of a federal consolidated return.
Keep records supporting each member’s reason for exclusion from the UBG return. The instructions require you to retain these records.
How to file
Include completed Form 4896 as part of the tax return filing.
Enter the Designated Member’s name and FEIN at the top. For each excluded entity, complete columns A through F as applicable. Use column D for the exclusion reason code and enter an “X” in column E if the entity has nexus with Michigan.
If you need more space, include additional copies of Form 4896 and repeat the Designated Member’s name and FEIN at the top of every copy.
The provided text does not specify a mailing address or an e-file method.
Common mistakes
- Missing federal Form 851: Attach a copy if any entity listed on Form 4896 is a member of a federal consolidated return.
- Using reason code 1 for an elected affiliated group member: Code 1 does not apply to a member of a group that has made the Affiliated Group Election.
- Using the wrong tax-year period for the combined return: A UBG must use the Designated Member’s tax year. Its combined return must include each tax year of each member that ends with or within the Designated Member’s tax year.
- Leaving identifying information off extra copies: Repeat the Designated Member’s name and FEIN on every additional copy of Form 4896.
Questions people ask
Do I list an excluded affiliate that has no nexus with Michigan?
Yes. List entities that meet the applicable ownership test and are excluded from the combined standard return, with or without Michigan nexus. Mark column E with an “X” only if the entity has Michigan nexus.
Which exclusion reason codes can I use?
The form lists these codes:
- 1: Lacks business activities resulting in a flow of value, integration, dependence, or contribution to the group. This code does not apply to members covered by an Affiliated Group Election.
- 2: Foreign operating entity.
- 3: Foreign entity.
- 4: Member has no CIT tax year, as a member of this UBG, ending with or within the filing period.
- 5: Insurance company.
- 6: Financial institution.
- 9: Other.
Where do I get the NAICS code?
Use the entity’s six-digit code from the most recent NAICS code list at www.census.gov/naics/, or use the same code used on the entity’s federal Form 1120, Schedule K.
Who can help me choose an appropriate entry?
Call the Michigan Treasury Technical Services Section at 517-636-4230 to discuss an appropriate entry.