Michigan House Bill HB4124

Michigan 2025-2026 Regular Session

• Introduced: 2/25/25
• Refer: 2/25/25
• Report Pass: 3/25/25

Caption

Corporate income tax: credits; credit for advanced small modular reactors research and development expenses; provide for. Amends 1967 PA 281 (MCL 206.1 - 206.847) by adding secs. 677a & 717a. TIE BAR WITH: HB 4127'25, HB 4129'25, HB 4125'25, HB 4126'25, HB 4128'25

Impact

The bill sets an aggregate limit on credits that can be claimed by all taxpayers and employers under this act, capping it at $2.5 million per year. If this threshold is exceeded, the department will prorate the credits among claimants. This provision ensures that the state can manage the financial impact of the tax credits while supporting a growing industry. Furthermore, any credit exceeding a taxpayer's tax liability can be carried forward for up to 15 years, thus providing a multi-year incentive framework for businesses invested in advanced nuclear technology.

Summary

House Bill 4124 proposes amendments to the Income Tax Act of 1967, specifically by introducing new sections that provide tax credits for qualified research and development expenses related to advanced nuclear reactor technologies. Specifically, for tax years beginning on or after January 1, 2026, taxpayers will be eligible for a credit equal to 15% of their R&D expenditures. This initiative is aimed at encouraging innovation within the state and fostering economic development in the nuclear energy sector. Taxpayers who utilize these credits must file tentative claims by March 15 of the subsequent year, ensuring that claims are systematically reviewed by the state department.

Contention

Supporters of HB 4124 argue that it will significantly contribute to the advancement of nuclear technology, particularly in enhancing the availability of small modular reactors as environmentally friendly energy sources. However, there may be opposition related to concerns over prioritizing nuclear technology given ongoing debates about energy sources and safety. Additionally, the bill is tied to the passage of several other bills, which raises questions about legislative negotiations and the overall focus on nuclear innovation versus other energy technology initiatives in the state.