Caughtcha being Good!
Beavers around the Elk River have been up to mischief lately, taking the occasional tree down in unfortunate places. Such was the case recently when a beaver toppled a tree across Mitchell Dr. blocking the road. Instead of calling the DPW or anyone for help, Drew Plum got out his chainsaw, cut up the tree and dragged the pieces away. Way to go, Drew! You are an involved and valued member of the community.
At the Elk Rapids Township board meeting on November 13, 2023 all the trustees were present. We apologize for any confusion. – Editor
Miss Elk Rapids applications available now
The Miss Elk Rapids Program is seeking contestants for their 2024 Queen and court. Young ladies between the ages of 5-21, who attend Elk Rapids Schools, graduated from Elk Rapids High School or live year-round in the school district, are encouraged to apply. Over $8200 in scholarships and prizes will be awarded on pageant night.
Applications are available at any Elk Rapids School office or by emailing
firstname.lastname@example.org. The deadline to apply is December 1.
AMVETS Post 114 starts 2nd Annual Holiday Food Baskets
AMVETS Post 114 is shopping and storing the items that go into their Holiday Food Baskets for those in the community who could use a little additional help during the holiday season.
“We’ve enjoyed tremendous support from the community over the years. It’s a great feeling to be able to give back,” said Jack Moran, commander at AMVETS Post 114. “Not only are we helping veterans’ families, we also get the opportunity to help some families in our local community as well.”
Community impact: A total of 35 gift baskets were assembled and passed out last year between Thanksgiving and Christmas. Additionally, about 10 individual meals were cooked and distributed to members of the community. AMVETS Holiday Basket Committee Chairman Rob Turnbull has expressed his desire to double the number of baskets passed out this year. AMVETS, The Ladies Auxiliary, Sons of AMVETS and American Legion all participate in this program.
Basket availability: AMVETS is working with Veteran Services Officers from four counties, as well as private organizations to identify families throughout the area that would benefit from the program. If you know of a family in need that would benefit from this program, please feel free to contact Rob Turnbull: 414-514-5514 via phone or text, or email Adjutant114@yahoo.com.
MICHIGAN’S FLOW THROUGH ENTITY TAX
In 2017, the Tax Cuts and Jobs Act (TCJA) limited the combined amount of state income taxes, local income taxes, property taxes, etc., able to be deducted on an individual’s federal income tax return to $10,000. Paying over $10,000 in the above taxes resulted in losing the ability to deduct these taxes before federal income tax is calculated. The reasoning behind this change was that individuals residing in states with little or no state income taxes like Texas and Wyoming were viewed as subsidizing the residents of states that had higher state income taxes, as those residents received a greater deduction and thus a decrease in federal income taxes. The TCJA also doubled the standard deduction, making it less likely for individuals to deduct their state income taxes paid on their federal income taxes.
To address these limits, Michigan is part of a growing number of states that have enacted a Flow Through Entity (FTE) tax. FTE is just a fancy way of referring to businesses whose profits and losses “flow through” to the business owner in proportion to the percentage owned. With the FTE tax, electing flow-through businesses pay state income taxes on its business income on behalf of each owner, resulting in a federal tax deduction at the business level, and in turn provides to each owner a state income tax credit for their share of tax paid by the business to be claimed on their individual state income tax return. To prevent a double benefit, owners must make specific adjustments when calculating their individual state taxable income. In Michigan, FTEs that elect this tax are required to file annually, and FTE owners still need to file individual income tax returns. Here’s a breakdown of Michigan’s FTE tax:
1. Eligibility and Exclusions: The FTE tax applies to electing businesses with business activity in Michigan. In general, businesses eligible for the election include partnerships, LLCs filing as partnerships or S-Corporations, and C corporations with a valid S-election.
2. Making the Election: Entities elect into the FTE tax by making an electronic payment to the Michigan Department of Treasury through Michigan Treasury Online (MTO) by the 15th day of the third month of their tax year (March 15th for a calendar year filer). This payment is usually the first quarter FTE estimated tax payment, though it can be a nominal or greater amount. The election is irrevocable and spans the election year and the next two tax years.
3. Calculating the Tax: The FTE tax mirrors individual income tax rates (4.05% for 2023) and is applied only on the business’s Michigan portion of positive business income tax base (business income). This base starts with the business’s federal taxable income and is adjusted for items typically required of individuals on Form MI-1040, Michigan Individual Income Tax Return, including any FTE tax deducted in the tax year.
4. Filing and Payment Methods: An annual FTE Michigan tax return (Form 5774) is due by the last day of the third month after the business’s tax year. Extensions of up to six months are possible. Estimated payments are required for businesses expecting a tax liability over $800, with penalties and interest for underpayments. All submissions must be electronic through MTO.
5. Reporting Requirements: Electing entities must report relevant information to owners on their federal Schedule K-1, Partner’s (Shareholder’s) Share of Income, Deductions, Credits, etc., detailing the allocation and apportionment of the Michigan business income, owner’s allocable share of current year FTE tax, and owner’s share of FTE tax available as a current year credit for example.
For more information, go to WWW.MICHIGAN.GOV/TAXES, Business Taxes, Flow-Through Entity Tax, then click on Go to Flow-Through Entity Tax. – Submitted by Char Kirchner, CPA, MSA and Rex Rudolph, CPA
Elk Rapids District
VILLAGE OF ELK RAPIDS
Elk Rapids News
212 River Street
P.O. Box 176
Elk Rapids, Michigan 49629