Michigan — No General Partnership Income Tax Return — Michigan does not require a general partnership income tax return; partnership income is taxed to the partners unless the entity elects the flow-through entity tax

# Summary

Michigan does not require a general partnership income tax return. There is no Michigan equivalent of federal Form 1065 that every partnership must file each year, and the former Form MI-1065 is no longer in use; no Michigan partnership return form exists to name. Partnership income is taxed to the partners: MCL 206.51(1) levies the individual income tax on the taxable income of "every person other than a corporation," so a partner reports their distributive share on the Michigan individual return (Form MI-1040), and a corporate partner reports through the Corporate Income Tax. A partnership must file a Michigan return only in the specific circumstances described below — most importantly if it elects the flow-through entity tax, in which case it files Form 5772. Absent such an election or filing, the correct answer to "what form does a Michigan partnership file" is that there is none.

# What the statute requires of a partnership

Michigan's Income Tax Act imposes no standing annual return obligation on a partnership as such. MCL 206.331(2) provides only that "every corporation, voluntary association, joint venture, partnership, estate or trust at the request of the department shall file a copy of any tax return or portion of any tax return which has been filed under the internal revenue code," and that "the department may prescribe alternate forms of returns." That is a production obligation triggered by a departmental request, not an annual filing requirement, and it contemplates a copy of the federal return rather than a Michigan partnership form. Correspondingly, MCL 206.51(1) reaches partnership income through the partners rather than the entity. Michigan's separate partnership provisions at MCL 206.721 and MCL 206.723 govern federal partnership-level audits and administrative adjustment requests — reporting obligations arising from a federal adjustment, again not an annual return.

# When a Michigan partnership does file

Three circumstances produce a Michigan filing by the entity, and none of them is a general partnership return. First, the flow-through entity tax election: under MCL 206.813 a flow-through entity "may, in a form and manner as prescribed by the department, elect to file a return and pay the tax imposed by this part." The election is optional and, once made, is irrevocable for that year and the next two tax years. For tax years beginning on or after January 1, 2024, the election must be filed on or before the last day of the ninth month after the end of the tax year — September 30 for a calendar-year filer. An electing entity files the Flow-Through Entity Tax Annual Return, Form 5772, which under MCL 206.833(1) is due by the last day of the third month after the end of the tax year, and must make quarterly estimated payments if its annual liability is reasonably expected to exceed $800 (April 15, June 15, September 15 and January 15 for calendar-year filers). The tax is imposed by MCL 206.815(1) at the same rate levied under section 51 for that tax year, so the flow-through entity tax rate tracks the individual income tax rate rather than having a separate rate of its own. Second, a composite return: a flow-through entity may file Form 807 on behalf of participating nonresident individual members, which is elective and does not make the entity the taxpayer. Third, withholding and information reporting obligations may apply independently of any return described here.

# What this determination does not say

This determination addresses only the absence of a general partnership income tax return. It does not say that Michigan exempts partnership income from tax — the income is fully taxable in the partners' hands under MCL 206.51. It does not say Michigan lacks an entity-level tax on pass-through entities: Michigan does have one, the flow-through entity tax of Part 4 (MCL 206.801 et seq.), but it applies only on election. It does not address the Corporate Income Tax, which reaches C corporations and is described in Form 4890 and Form 4891, nor sales, use and withholding obligations, which apply to a partnership on the same terms as any other business.