Individual income tax: credit; working parent tax credit for certain dependents; provide for. Amends 1967 PA 281 (MCL 206.1 - 206.847) by adding sec. 272a.
Impact
The implementation of HB4488 is expected to enhance financial relief for families with young children, promoting better economic stability for parents who qualify. By allowing taxpayers to claim credits for their dependents, the bill seeks to incentivize labor participation among families. However, the legislation outlines specific limitations, including capping the number of dependents eligible for credits to three per tax year, which is designed to balance the fiscal implications for the state treasury while still offering substantial support to families.
Summary
House Bill 4488 proposes an amendment to the Income Tax Act of 1967 in Michigan, introducing a new section that allows qualifying taxpayers to claim a tax credit for dependents who are three years of age or younger. Specifically, the bill provides a $5,000 credit for each eligible dependent for tax years starting from January 1, 2025. This provision aims to provide financial support to working parents, reducing the tax burden associated with raising young children.
Contention
Notable points of contention surrounding HB4488 may stem from concerns about its fiscal impact on state revenue. Critics often voice apprehensions regarding the potential strain on the budget due to increased tax credits, questioning how such financial incentives will be balanced with other pressing budgetary needs. Additionally, discussions may focus on ensuring that the eligibility criteria, particularly the income threshold of $10,000 for taxpayers, adequately reflects the diverse economic circumstances of families across Michigan.
Individual income tax: credit; credit for certain investments in Michigan businesses; provide for. Amends 1967 PA 281 (MCL 206.1 - 206.847) by adding sec. 280.