Michigan Justices Accept State’s Sale Apportionment Formula (1)

The Michigan treasury department properly attributed 70% of the income from the sale of an out-of-state company to Michigan, the state high court ruled.

The state’s formula for calculating business tax “did not impermissibly tax income outside the scope of Michigan’s taxing powers and thus did not violate the Due Process or Commerce Clauses of the United States Constitution,” Justice Elizabeth M. Welch wrote for the 4-3 Michigan Supreme Court in an opinion released Monday.

The ruling reversed a state appeals court decision that it was unconstitutional to apply the state’s “single sales factor” income tax apportionment formula to the ...