Income/Franchise:
Michigan Department of Treasury Discusses Case Involving Investments in REMICs and Business Loss Carryforwards
Treasury Update Newsletter, Mich. Dept. of Treasury, Tax Policy Division (8/24). A newsletter published by the Tax Policy Division of the Michigan Department of Treasury (Department) discusses a recent Michigan Court of Appeals decision [see Case No. 364746, Mich. Ct. App. (5/16/24), and State Tax Matters, Issue 2024-21, for more details on this decision] affirming that a taxpayer holding real estate mortgage investment conduits (REMICs) cannot exclude excess inclusion income (EII) from the federal taxable income (FTI) amount used in computing its tax base under Michigan’s corporate income tax (CIT). According to the Department, “this holding is a reminder to taxpayers that despite unusual federal tax reporting requirements or tax situations that may be unique to a limited number of taxpayers, the CIT is clear that the starting point in computing tax base begins with FTI that is adjusted by the statutory adjustments either before or after allocation or apportionment.” Moreover, the Department explains that federal net operating losses are not the same as CIT business losses. The newsletter notes that the taxpayer in this case has appealed this 2024 decision to the Michigan Supreme Court. Please contact us with any questions.
30 Rockefeller Plaza New York, NY 10112-0015 United States
About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms, and their related entities (collectively, the “Deloitte organization”). DTTL (also referred to as “Deloitte Global”) and each of its member firms and related entities are legally separate and independent entities, which cannot obligate or bind each other in respect of third parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions, and not those of each other. DTTL does not provide services to clients. Please see www.deloitte.com/about to learn more.
Deloitte provides industry-leading audit and assurance, tax and legal, consulting, financial advisory, and risk advisory services to nearly 90% of the Fortune Global 500® and thousands of private companies. Our professionals deliver measurable and lasting results that help reinforce public trust in capital markets, enable clients to transform and thrive, and lead the way toward a stronger economy, a more equitable society and a sustainable world. Building on its 175-plus year history, Deloitte spans more than 150 countries and territories. Learn how Deloitte’s approximately 415,000 peopleworldwide make an impact that matters at www.deloitte.com.
