Bill
HB 5293
Creates a 50% credit of Michigan income tax withheld for each new high-paying full-time job (up to $50M/yr) to spur permanent Michigan hiring.
Status
- Introduced (House) — filed 2025; electronically reproduced 11/13/2025. Referred to the House Committee on Finance. Companion: SB 1620.
- Enacting provision: bill does not take effect unless HB 5292 is enacted (tie-bar).
Purpose
- Create a temporary payroll withholding credit to encourage employers to create permanent, full‑time jobs in Michigan that pay substantially above local median wages.
Key provisions
- Credit amount: Employers may claim a credit equal to 50% of the amount of Michigan individual income tax withheld that is attributable to each "qualified new job."
- Effective period: Applies to tax years beginning on or after January 1, 2026 and before January 1, 2036 (i.e., through tax year 2035).
- Annual statewide cap: $50,000,000 total credits allowed per calendar year.
- Size-based set-asides within the $50M cap:
- Small employers (<100 full‑time employees): at least $10,000,000 reserved.
- Medium employers (100–999 full‑time employees): at least $15,000,000 reserved.
- Large employers (≥1,000 full‑time employees): at least $25,000,000 reserved.
- If claims in a category exceed its cap, credits in that category are prorated among claimants pro rata.
- Eligibility screening: Employers must submit a tentative claim (form/manner prescribed by Treasury) on or before March 15 following the calendar year in which the jobs are maintained/created. Treasury reviews tentative claims and will post adjustments if caps require proration.
- Filing: Employer files the formal claim with its annual return under section 711 for the tax year; the HB requires these credits be claimed after all allowable nonrefundable credits.
- Refundability and carryforward: Credits are nonrefundable. Unused credit may be carried forward up to 3 tax years.
- Transferability: Credits are not assignable or transferable. Members of a flow‑through entity that receives the credit may not separately claim any portion.
- Disqualification: Employers who, as taxpayers, failed to maintain at least 95% of their full‑time Michigan jobs as of Sept. 30, 2025 (per section 670) are ineligible for the credit for the first tax year they fail that requirement.
Definitions and key thresholds
- Qualified new job: A permanent, full‑time job (35+ hours/week) created in Michigan that (1) exceeds the employer’s permanent full‑time jobs in Michigan as of Sept. 30, 2025, and (2) pays at least 150% of the median annual wage for the Michigan “prosperity region” where the facility is located.
- Full‑time job: 35+ hours/week and subject to withholding for income and Social Security by the employer, an employee leasing company, or a PEO.
- Prosperity regions: the 10 regions identified by the state (DTMB) on Aug. 25, 2017; median wages from Michigan’s Bureau of Labor Market Information.
Potential impact
- Incentivizes creation of higher‑paying full‑time jobs in Michigan.
- Reduces state withholding receipts up to $50M per calendar year (subject to actual claims and proration rules).
- Prioritizes distribution across employer sizes via set-asides, potentially benefitting small and medium employers when overall claims are high.
- Administrative responsibilities for Treasury include processing tentative claims, applying caps/prorations, and administering carryforwards.
Procedural note
- The bill is explicitly tied to HB 5292; it will not take effect unless that bill is enacted.
Compiled from official sources — confirm details with the bill’s official record.
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