Michigan Individual Income Tax E-File Mandate Expanded
On February 18, 2011 the Michigan Department of Treasury issued a statement noting that the tax preparers of personal income tax returns are currently required to e-file if they prepare 200 or more returns. The Michigan Department of Treasury said that it expects any tax preparer e-filing a federal income tax return to e-file the Michigan return. Beginning January 1, 2011, the IRS is mandating tax preparers filing 100 or more personal income tax returns to e-file. The federal threshold is reduced to 11 or more returns beginning January 1, 2012.
Michigan Business Tax E-File Mandate Expanded
Michigan will strengthen the Michigan Business Tax (MBT) e-file mandate as part of budgetary savings measures. Below are some of the details related to the changes for tax year 2010.
Beginning with the 2010 tax year, Michigan will have an enforced MBT e-file mandate. Developers producing MBT tax preparation software and computer-generated forms must support e-file for all eligible Michigan forms that are included in their software package. All eligible MBT returns prepared using tax preparation software or computer-generated forms must be e-filed.
Treasury will not process computer-generated paper returns that are eligible to be e-filed. A notice will be mailed to the taxpayer indicating the return was not filed in the proper form and content and must be e-filed. Payment received with a paper return will be processed and credited to the taxpayer's account even when the return is not processed.
Treasury recognizes that there are conditions which make a return ineligible for e-file. When the computer-generated MBT return meets one or more of the Treasury-recognized e-file exceptions, the taxpayer may have to complete and attach Form 4833, Michigan Business Tax E-File Exceptions to the front of their return or the paper filing will not be processed.
Attach Form 4833 to a computer-generated paper return that meets one or more of the Treasury recognized e-file mandate exceptions.
Treasury-recognized exceptions at the time of this printing include, but are not limited to:
? Taxpayer is filing one or more of the following forms:
o Qualified Affordable Housing Seller's Deduction (Form 4579)
o Tribal Agreement Ownership Schedule (Form 4597)
o Tribal Agreement Apportionment (Form 4598)
? Return was prepared by a preparer who has been suspended or denied acceptance to participate in the IRS or does not have an EFIN.
? Return was rejected by Michigan or IRS and there is no way to correct and resubmit the return electronically and software does not support State Stand Alone.
? Taxpayer's federal return contains a form that is not eligible for e-file and the software does not support State Stand Alone e-file.
The following are also Treasury-recognized exceptions. However, do not attach Form 4833 to a MBT paper return that meets one or more of the following conditions.
? UBG returns. However, whenever possible the preferred method is e-file.
? Taxpayer is an individual or fiduciary.
? Taxpayer does not have a Federal Employer Identification Number (FEIN).
? Completed by hand (with pen or pencil).
? Completed using forms from Treasury's Web site.
? Completed using forms from Michigan tax instruction books.
Additional information will be published on Treasury's Web sites www.michigan.gov/taxes and www.MIfastfile.org as it becomes available.
Contact Information for Michigan Electronic Filing Programs.
This contact information is for tax preparers and software developers only and enables Treasury to provide better service to authorized e-file providers. The Electronic Filing staff is unable to provide return status information or address specific taxpayer account issues. Should an error occur on the Michigan return during mainframe processing, Treasury will communicate directly with the taxpayer through the regular error resolution process.
Telephone: (517) 636-4450
Fax: (517) 636-437