Fill Your Michigan 807 Template

The Michigan 807 form is a Composite Individual Income Tax Return used by flow-through entities, such as partnerships and S corporations, to report income on behalf of their nonresident members. This form must be filed by April 15 each year, and it requires specific attachments to ensure compliance with Michigan tax regulations. Accurate completion of the form is essential to avoid penalties and interest; thus, it is important for entities to understand the requirements and deadlines associated with it.

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Documents used along the form

The Michigan 807 form is a key document for partnerships, S corporations, and other flow-through entities filing their composite individual income tax returns. However, it is not the only form you'll need. There are several other documents that often accompany the Michigan 807 form, each serving a specific purpose in the tax filing process. Here’s a brief overview of these essential forms and documents.

U.S. Form 1065: This is the U.S. Return of Partnership Income. It provides detailed information about the partnership’s income, deductions, and credits. Pages 1, 2, and 3 of this form must be attached to the Michigan 807 form.
U.S. Form 1120S: This is the U.S. Income Tax Return for an S Corporation. Similar to Form 1065, it outlines the S corporation's financial activities and must also be attached to the Michigan 807 form if applicable.
MI-1040H: This Michigan Schedule of Apportionment helps determine how much of the income is taxable in Michigan. The apportionment percentage from this form is crucial for completing the Michigan 807.
California Vehicle Purchase Agreement: This agreement is crucial for documenting the sale and purchase of vehicles in California, ensuring both the buyer and seller are aware of their rights and responsibilities in the transaction. For more details, visit Formaid Org.
MI-NR-K1: This form is used to report each nonresident member's share of income, deductions, and credits from the partnership or S corporation. It is essential for ensuring that all participants’ tax liabilities are accurately reported.
Distributive Income Worksheet: This internal document helps calculate the total distributive income from various sources, including ordinary income and rental income. It supports the figures reported on the Michigan 807 form.
Power of Attorney: This document grants authority to the firm to file the composite return on behalf of the participants. It is crucial for compliance and ensures that the tax authority can communicate with the firm regarding the return.
Extension Request Form (Form 4): If more time is needed to file the Michigan 807, this form can be used to request an extension. It must be submitted before the original due date to avoid penalties.

Understanding these accompanying documents is vital for ensuring a smooth tax filing process. Each form plays a unique role in providing necessary information to the Michigan Department of Treasury, and together they help clarify the financial standing of the partnership or S corporation. Properly completing and submitting these forms can help avoid penalties and ensure compliance with state tax laws.

Michigan 807 Preview

Michigan Department of Treasury 807 (Rev. 1-05)

2004 MICHIGAN

Composite Individual Income Tax Return

This return is due April 15, 2005. Type or print clearly in blue or black ink.

This form is issued under authority of P.A. 281 of 1967, as amended. Failure to file may result in the assessment of penalty and interest and could result in the revocation of filing agreement.

1. Name of Partnership, S Corporation or Other Flow-Through Entity	2. Federal Employer Identification or TR Number

3. Mailing Address (Street, P.O. Box or Rural Route No.)

4. City, Village or Township	State	ZIP Code

NOTE: Pages 1, 2 and 3 of the U.S. 1065 or 1120S, the MI-1040H, a list of participants and a list of nonparticipants must be attached to this return. See instructions.

5.	Ordinary income (loss) from line 22 of U.S. 1065 or line 21 of U.S. 1120S			5.	.00
6.	Additions (from line 35, page 2)			6.	.00
7.	Subtotal. Add lines 5 and 6		7.		.00
8.	Subtractions (from line 38, page 2)			8.	.00
9.	Total income subject to apportionment. Subtract line 8 from line 7		9.		.00
10.	Apportionment percentage from MI-1040H. (Caution! See instructions.)			10.	%
11.	Total Michigan apportioned income. Multiply line 9 by the percentage on line 10		11.		.00
12.	Michigan allocated income or (loss) (from line 43, page 2)			12.	.00
13.	Total Michigan income. Add lines 11 and 12		13.		.00
14.	Enter Michigan income that is attributable to Michigan residents			14.	.00
15.	Enter Michigan income that is attributable to nonparticipating nonresidents			15.	.00
16.	Enter Michigan income that is attributable to participants		16.		.00
17.	Exemption allowance (from line 49, page 2)	17.	.00
18.	SEP, SIMPLE or qualified plan deductions (from line 52, page 2)	18.	.00
18.		18.	19.		.00
19.	Add lines 17 and 18		19.		.00
20.	Taxable income. Subtract line 19 from line 16		20.		.00
21.	Tax due. Multiply line 20 by 3.95% (.0395)		21.		.00
22.	Michigan extension payments and credit forward			22.	.00
23.	Withholding tax payments			23.	.00

24.If line 22 plus line 23 is less than line 21, enter TAX DUE.

	Include interest	and penalty	, if applicable		PAY 24.	.00
	Include interest	and penalty	, if applicable		PAY 24.	.00
25.	If line 22 plus line 23 is more than line 21, enter overpayment			25.		.00
26.	Amount of line 25 to be credited to your 2005 estimated tax		26.	.00
27.	Subtract line 26 from line 25			REFUND 27.		.00
27.	Subtract line 26 from line 25			REFUND 27.

CERTIFICATION

I declare under penalty of perjury that the information in this return and attachments is true and				I declare under penalty of perjury that this return is based on all
complete to the best of my knowledge. I have obtained the required Power of Attorney from each
				information of which I have any knowledge.
of the members of this composite return and my firm will resolve the issue of any tax liability.				information of which I have any knowledge.


				Preparer's Name, Address, PTIN and/or FEIN
Filer's Signature		Date		Preparer's Name, Address, PTIN and/or FEIN
Filer's Signature		Date

I authorize Treasury to discuss my return with my preparer.	Yes		No
I authorize Treasury to discuss my return with my preparer.	Yes		No

Mailing: Make check payable to "State of Michigan." Write the firm's Federal Employer Identification Number, "Composite

Return" and Tax Year on the check. Mail return with payment (if applicable) to: Composite Return, Michigan Department of Treasury, P.O. Box 30058, Lansing, MI 48909.

www.michigan.gov/treasury

Continued on Page 2

2004 807, Page 2

Name of Partnership, S Corporation or Other Flow Through Entity	Federal Employer Identification or TR Number

	ADDITIONS (see instructions)
28.	Net income (loss) from rental real estate activities	28.
29.	Net income (loss) from other rental activities	29.
30.	Portfolio Income (loss) (see instructions):
	a. Interest income	30a.
	b. Dividend income	30b.
	c. Royalty income	30c.
	d. Net short-term capital gain (loss) (from U.S. Schedule K)	30d.
	e. Net long-term capital gain (loss) (from U.S. Schedule K)	30e.
	f. Other portfolio income	30f.
31.	Net gain (loss) under Section 1231	31.
32.	Other income from U.S. Schedule K	32.
33.	State or local taxes measured by income	33.
34.	Other miscellaneous additions (attach schedule)	34.
35.	Total additions. Add lines 28 through 34. Enter here and on line 6	35.
	SUBTRACTIONS (see instructions)
36.	Income (loss) from other partnerships, S corp. and fiduciaries included in ordinary income	36.
37.	Other miscellaneous subtractions (attach schedule)	37.
38.	Total subtractions. Add lines 36 and 37. Enter here and on line 8	38.
	MICHIGAN ALLOCATED INCOME OR (LOSS)
39.	Guaranteed payments to participants for services performed in Michigan	39.
40.	Income attributable to other Michigan partnerships, S corporations or fiduciaries	40.
41.	Net Michigan capital gains (losses) (from U.S. Schedule D)	41.
42.	Other Michigan allocated income (loss) (see instructions)	42.
43.	Total Michigan allocated income (loss).
	Add lines 39 through 42. Enter here and on line 12	43.
	EXEMPTION ALLOWANCE
44.	Number of participants included in this agreement	44.
45.	Line 44 times $3,100 exemption allowance	45.
46.	Total Michigan income from line 13	46.
47.	Total distributive income (Total Distributive Income from Distributive Income Worksheet)	47.
48.	Percent of income attributable to Michigan. Divide line 46 by line 47.
	(May not exceed 100%.)	48.
49.	Apportioned exemption allowance. Multiply line 45 by the percentage on line 48
	Enter here and on line 17	49.
	SEP, SIMPLE OR QUALIFIED PLAN SUBTRACTIONS
50.	SEP, SIMPLE or qualified plan subtractions for participants (attach schedule)	50.
51.	Enter the percent of income attributable to Michigan from line 48	51.
52.	SEP, SIMPLE or qualified plan subtractions attributable to Michigan
	Multiply line 50 by the percentage on line 51. Enter here and on line 18	52.

.00

2004 807, PAGE 3

Instructions for Form 807, Michigan Composite Individual Income Tax Return

GENERAL INSTRUCTIONS

Who may file a return

Aflow-through entity, defined as partnerships, S corporations, limited partnerships, limited liability companies, or limited liability partnerships, that does business in Michigan and has two or more nonresident partners, shareholders or members (participants). The entity (firm) and participants must agree to comply with the Michigan Department of Treasury (Treasury) rules described below.

Participation Requirements

A member may not participate in this composite return in any of the following cases:

•If he or she is claiming a city income tax credit, public contribution credit, community foundation credit, homeless shelter/food bank credit, college tuition credit or Michigan Historic Preservation Tax Credit.

•If he or she was a Michigan resident (full-year or part-year).

•If he or she wishes to claim more than one Michigan exemption.

Due date of return

The composite return for any tax periods ending in 2004 is due April 15, 2005. The returns for any periods ending in 2005 will be due April 15, 2006.

If the firm cannot file by the due date, a request for an extension can be filed before the original due date. See “Requesting an Extension” on this page.

Withholding tax payments

Composite filers are required to make withholding tax payments on behalf of

all nonresident members (both participating and nonparticipating). The payment of withholding is due quarterly on April 20, July 20, and October 20 of the taxable year and January 20 of the succeeding year. The payment of withholding taxes is remitted on the payment voucher Form 160, Combined Return for Michigan Taxes.

Requesting an extension

The firm may request an extension of time to file by sending payment of the estimated annual liability to Treasury with a copy of an approved federal extension. Any extension allowed by the

Internal Revenue Service for filing the firm’s federal return automatically extends the due date of the composite return to the same extended due date.

If the firm does not apply for a federal extension, request an Application for Extension of Time to File Michigan Tax Returns (Form 4). When completing the extension form, check “Fiduciary Tax” in box 1, use the firm’s name and federal employer identification number (FEIN) and write “composite return” on the form. Follow these special instructions to make sure your account is credited properly.

Payment of the estimated annual liability

must be made with the extension application. When you file your composite return, attach a copy of your extension application to it. Obtain Form MI-1041ES

from www.michigan.gov/treasury, Fiduciary Forms. Download a copy of the quarterly forms and complete one quarterly form. Use the name of the firm and the firm’s FEIN or the recipients Social Security number (SSN). Check the box labeled “CF” at the top of the voucher. Do not use the other three quarterly estimate forms.

Mailing refunds, assessments and correspondence

By signing the Michigan Composite Income Tax Return (Form 807), the signing partner or officer declares that the firm has power of attorney from each participant to file a composite return on his or her behalf. Treasury will mail refund

checks, assessments and all correspondence to the firm at the address indicated on the return. The firm must agree to be responsible for the payment of any additional tax, interest and penalties as finally determined. Issues involving the tax liability reported on a composite return will be resolved with the firm. In unusual circumstances, the department may contact the participants.

Attachments

Attach the following items to the composite return:

•A copy of pages 1, 2 and 3 of the U.S. 1065 or U.S. 1120S .

•A Michigan Schedule of Apportion- ment (Form MI-1040H).

•All required forms MI-NR-K1 for each member of the composite return.

•Two schedules (one for participants and one for nonparticipants) listing each partner’s, shareholder’s or member's name, address, SSN and respective share of Michigan income and/or loss. If the participating member is another flow-through entity, the schedule must include the entity’s name, address, FEIN, and share of Michigan-sourced income, as well as a list of the names, addresses, SSNs and ownership percentages of that entity’s nonresident partners or shareholders.

•A statement signed by an authorized officer or general partner certifying that each participant has been informed of the terms and conditions of this program.

LINE-BY-LINE INSTRUCTIONS

Lines not listed are explained on the form.

Line 10: Enter the apportionment percentage from Form MI-1040H. DO NOT

use the Single Business Tax apportionment percentage from Form C-8000H. The MI-1040H apportionment percentage is NOT weighted and the property factors are based on property owned or rented and USED in Michigan. See MI-1040H instructions for income tax nexus standards.

Line 13: The amount on this line should equal the total of lines 14, 15 and 16.

Line 21: Multiply the amount on line 20 by 3.95 percent (.0395).

Line 23: Enter the amount of withholding tax payments made on behalf of participating members.

Flow-Through Entities. Flow-through entities are required to withhold Michigan income tax on the taxable income available for distribution to nonresident members.

The amount of withholding is calculated and remitted on a quarterly basis by multiplying the share of taxable income allocable to each member, adjusted for the allowable exemption amount for a quarter, times the income tax rate (4.0 percent through June 30, 2004 and 3.9 percent beginning July 1, 2004).

Aflow-through entity is also required to withhold Michigan income tax when one or more of the entity’s members is a

2004 807, PAGE 4

nonresident flow-through entity. The flow-through entity in Michigan shall withhold Michigan income tax from any such nonresident flow-through entity on behalf of all of the nonresident members.

Line 24: If line 22 plus line 23 is less than line 21, enter the balance of the tax due. This is the tax owed with the return. Enter any applicable penalties and interest in the spaces provided. Add tax, penalty and interest together and enter the total on this line. If balance due is less than $1, no payment is required. Make checks payable to “State of Michigan.” Write the firm’s FEIN, “Composite Return,” and the tax year on the front of the check. To ensure accurate processing of your return, send one check for each return type.

Line 27: Refund. Subtract line 26 from line 25. This is the refund. Treasury will not refund amounts less than $1.

Mail your completed return with payment (if applicable) to:

Composite Return

Michigan Department of Treasury

P.O. Box 30058

Lansing, MI 48909

Additions

Distributive Income Worksheet

Column A refers to Distributive Income categories from Schedule(s) K. Column B and C refer to lines on the U.S. 1065 Schedule K and U.S. 1120S Schedule K. Column D is the list of amounts that are added to arrive at total distributive income that is reported on Form 807, line 47.

A	B	C	D
A	U.S. 1065	U.S. 1120S	Distributive Income
Distributive Income Categories	U.S. 1065	U.S. 1120S	Distributive Income
Distributive Income Categories	Schedule K	Schedule K	Amounts
	Schedule K	Schedule K	Amounts
Ordinary income (loss) from trade or business	1	1
activity	1	1
activity
Net income (loss) from rental real estate	2	2
activity	2	2
activity
Net income (loss) from other rental activity	3c	3c

Portfolio income (loss):
Interest income	5	4

Dividend income	6a and 6b	5a and 5b

Royalty income	7	6

Net short-term capital gain (loss)	8	7

Net long-term capital gain (loss)	9a	8a

Guaranteed payments	4

Net gain (loss) under section 1231	10	9

Other income (loss)	11	10

TOTAL DISTRIBUTIVE INCOME
Add all amounts in Column D and carry total to Form 807, line 47.

Lines 28 through 32: Enter income from lines 2, 3c, 4, 5a, 5b, 6, 7, 8a, 9 and 10 of 1120S Schedule K and from lines 2, 3c, 5, 6a, 6b, 7, 8, 9a, 10 and 11 of U.S. 1065 Schedule K. Guaranteed payments, income attributable to other Michigan fiduciaries or flow-through entities should be allocated to Michigan on lines 39 through 42. See instructions below.

Line 33: Enter the amount of state and local income taxes that was used to determine ordinary income on line 22 of the U.S. 1065 or line 21 of the U.S. 1120S.

Line 34: Enter other additions to income, such as gross interest and dividends from obligations or securities of states and their political subdivisions other than Michigan.

Subtractions

Note: Charitable contributions and other amounts reported as itemized deductions on U.S. SCHEDULE A are not allowable subtractions in determining Michigan taxable income.

Line 36: Enter income (loss) from other fiduciaries or other flow-through entities that is included in ordinary income. Losses must be added back to ordinary

income. Attach a schedule showing the location of companies and amount of income attributable to each.

Line 37: Enter amounts such as interest from U.S. obligations that are included in line 30a, and other deductions for AGI (above the line) that were not included in determining ordinary income. This includes section 179 depreciation and amounts included on line 12[d][2] of U.S. 1120S Schedule K and on line 13[d][2] of U.S. 1065 Schedule K. Attach a schedule of all subtractions.

Michigan allocated income or loss

Line 39: Enter the portion of guaranteed payments attributable to services performed in Michigan by the nonresident participants.

Line 40: Enter income from other fiduciaries or other flow-through entities attributable to Michigan that have not been reported on another composite return. Attach a schedule showing the amount of income attributable to each.

Line 41: Enter gains/losses from the sale of real or personal property located in Michigan not subject to apportionment.

Line 42: Enter any other income (loss) allocated to Michigan. Include any Michigan net operating loss deduction (NOLD). Partnerships may include the Section 179 expenses on property located in Michigan as a deduction here. Attach schedules.

Exemption Allowance

Line 47: Enter the total distributive income as determined using the worksheet on this page.

Line 48: Compute the percentage of income attributable to Michigan by dividing total Michigan income (line 46) by the total distributive income (line 47). This figure may not exceed 100 percent.

SEP, SIMPLE or qualified plan subtractions

SEP - Simplified Employee Pensions

SIMPLE - Savings Incentive Match Plan for Employees

Line 50: Figure the portion of SEP, SIMPLE or qualified plan subtractions which is attributable to the participants. Attach a schedule showing calculations.

Similar forms

The Michigan 807 form, which is a composite individual income tax return, shares similarities with several other tax documents. Each of these forms serves specific purposes in reporting income and tax obligations, particularly for partnerships and flow-through entities. Below is a list of eight documents that are similar to the Michigan 807 form, along with explanations of their similarities:

U.S. Form 1065: This is the U.S. Return of Partnership Income. Like the Michigan 807, it is used by partnerships to report income, deductions, and other tax-related information. Both forms require detailed reporting of income and distributions to partners.
U.S. Form 1120S: This is the U.S. Income Tax Return for an S Corporation. Similar to the Michigan 807, it reports income and deductions for S Corporations, which are also flow-through entities. Both forms include sections for ordinary income and specific adjustments.
Michigan Form MI-1040H: This is the Michigan Homestead Property Tax Credit Claim. While it serves a different purpose, it is similar in that it requires income reporting for tax credits. Both forms require detailed calculations to determine the tax liabilities or credits available.
U.S. Schedule K-1 (Form 1065): This schedule reports each partner's share of income, deductions, and credits. Like the Michigan 807, it is essential for accurately reporting income from partnerships and is often attached to the main tax return.
U.S. Schedule K-1 (Form 1120S): Similar to the Schedule K-1 for partnerships, this schedule provides shareholders with details about their share of income, deductions, and credits from an S Corporation. Both K-1s are crucial for the participants' tax filings.
Form MI-NR-K1: This is the Michigan Nonresident Schedule K-1. It serves a similar function as the federal K-1s but is specific to Michigan. It details the income allocated to nonresident partners, much like the Michigan 807 addresses income for participants.
Trailer Bill of Sale: For those transferring trailer ownership, refer to our comprehensive trailer bill of sale resources to ensure all details are accurately documented.
Form MI-1041: This is the Michigan Fiduciary Income Tax Return. It is used by estates and trusts, similar to how the Michigan 807 is used for partnerships and S Corporations. Both forms require reporting of income and distributions to beneficiaries or participants.
Form 160: This is the Combined Return for Michigan Taxes. It is used for various tax obligations, including withholding taxes for nonresident members. Like the Michigan 807, it involves detailed calculations of tax liabilities based on income.

Understanding these documents can help streamline the tax filing process for partnerships and S Corporations operating in Michigan. Each form plays a crucial role in ensuring compliance with tax regulations while accurately reflecting the financial activities of the entities involved.

Misconceptions

Understanding the Michigan 807 form can be challenging, and several misconceptions often arise. Here are seven common misunderstandings:

Misconception 1: The Michigan 807 form is only for Michigan residents.

This form is actually designed for flow-through entities, such as partnerships and S corporations, that have nonresident members. It allows these entities to report income on behalf of their members.

Misconception 2: You can submit the form without any attachments.

In fact, the Michigan 807 form requires several attachments, including pages from the U.S. 1065 or 1120S and a list of participants. Failing to include these can lead to processing delays.

Misconception 3: All members of the entity must participate in the composite return.

Not all members can participate. For example, members claiming certain credits or who are Michigan residents cannot be included in the composite return.

Misconception 4: The due date for filing is the same every year.

The due date can vary. For the 2004 tax period, the return was due on April 15, 2005. Always check for the specific year you are filing.

Misconception 5: You do not need to pay estimated taxes if you file the 807 form.

Entities must make estimated tax payments on behalf of nonresident members. These payments are due quarterly, regardless of the composite return.

Misconception 6: The 807 form can be filed without any calculations.

Calculations are essential. You must determine ordinary income, additions, subtractions, and apportionment percentages to complete the form accurately.

Misconception 7: If you miss the filing deadline, there are no penalties.

Failing to file on time can result in penalties and interest. It's crucial to either file by the deadline or request an extension in advance.

Detailed Instructions for Using Michigan 807

Completing the Michigan 807 form requires careful attention to detail and accurate reporting of income and deductions. This form is due on April 15, 2005, for tax periods ending in 2004. Before starting, gather all necessary documents, including the U.S. 1065 or 1120S forms, and any supporting schedules. Ensure that you have the required information for all participants in the composite return.

Enter the name of the partnership, S corporation, or other flow-through entity at the top of the form.
Provide the Federal Employer Identification Number or TR Number in the designated space.
Fill in the mailing address, including street, P.O. Box, or rural route number, along with the city, state, and ZIP code.
Attach the necessary documents: Include pages 1, 2, and 3 of the U.S. 1065 or U.S. 1120S, the MI-1040H, and lists of participants and nonparticipants.
Report ordinary income or loss from the appropriate line of the U.S. 1065 or U.S. 1120S on line 5.
Complete line 6 with any additions from line 35, page 2.
Add lines 5 and 6 to find the subtotal, and enter this amount on line 7.
Enter any subtractions from line 38, page 2, on line 8.
Calculate total income subject to apportionment by subtracting line 8 from line 7 and enter the result on line 9.
Input the apportionment percentage from MI-1040H on line 10.
Multiply line 9 by the percentage on line 10 to determine total Michigan apportioned income and enter it on line 11.
Report Michigan allocated income or loss from line 43, page 2, on line 12.
Add lines 11 and 12 to find total Michigan income and enter it on line 13.
Complete lines 14 to 16 with the appropriate income amounts attributable to Michigan residents, nonresidents, and participants.
Enter the exemption allowance from line 49, page 2, on line 17.
Fill in any SEP, SIMPLE, or qualified plan deductions on line 18.
Add lines 17 and 18 and enter the total on line 19.
Calculate taxable income by subtracting line 19 from line 16 and enter the result on line 20.
Determine tax due by multiplying line 20 by 3.95% and enter this amount on line 21.
Report Michigan extension payments and credit forward on line 22.
Enter withholding tax payments on line 23.
If applicable, calculate tax due on line 24 by entering the amount owed, including any penalties and interest.
If applicable, report overpayment on line 25 and indicate how much will be credited to estimated tax on line 26.
Calculate refund by subtracting line 26 from line 25 and enter the result on line 27.
Sign and date the form in the certification section, confirming that all information is accurate.
Mail the completed form along with payment (if applicable) to the address provided for the Michigan Department of Treasury.

Dos and Don'ts

When filling out the Michigan 807 form, it's important to follow specific guidelines to ensure accuracy and compliance. Here’s a list of things you should and shouldn’t do:

Do type or print clearly using blue or black ink.
Do ensure that all required attachments, such as the U.S. 1065 or 1120S forms and the MI-1040H, are included.
Do double-check that all income and deduction amounts are accurate and match supporting documents.
Do file the form by the due date, which is April 15 for the applicable tax year.

Don't leave any sections blank; fill in all required fields to avoid delays.
Don't forget to sign and date the form before submission.
Don't use the Single Business Tax apportionment percentage; only use the MI-1040H percentage.
Don't send multiple checks for different tax types; ensure you send one check per return type to avoid processing issues.