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The Michigan Department of Treasury (Treasury) issued the 2024 Small Business Taxpayer Exemption (SBTE) reimbursements for Tax Year 2024 on March 12, 2026.

What are SBTE Reimbursements? 

In Tax Year 2023, the SBTE was expanded to include taxpayers that own, lease, or possess eligible personal property with a combined true cash value equal to or greater than $80,000 but less than $180,000.

The Michigan Trust Fund Act, 2000 Public Act 489, MCL 152.253a, requires Treasury to calculate and distribute SBTE reimbursements to municipalities for personal property tax revenue lost due to this expanded exemption.

Who is Eligible for SBTE Reimbursement?

SBTE reimbursements may be issued to:

• Counties, cities, villages, and townships
• Local school districts and intermediate school districts
• Community college districts
• Libraries and local authorities
• Tax increment finance authorities
• Other local units that levy millage on parcels covered by a taxpayer’s SBTE claim

How are SBTE Reimbursements Calculated?

Treasury calculates the SBTE reimbursement amount using:

• 50% of the property’s true cash value
• The municipality’s millage rate
• Adjustment for other exemptions (i.e. Industrial Facilities Tax and Renaissance Zone) and tax increment finance authority (TIFA) captures

Example Overview:

• A taxpayer claims an exemption for eligible personal property.
• The combined True Cash Value (TCV) of the property is $125,000.
• The Taxable Value (TV) is assumed to be 50% of TCV.
• The city levies a general operating millage of 10.0000 mills.
• One mill equals $1.00 in tax per $1,000 of TV.
• The property is located in an expiring Renaissance Zone (RZ):
  • 25% of the operating millage is exempt
  • 75% of the operating millage is taxable

Step-by-Step Calculation:

1. Determine Taxable Value (TV):
   $125,000 TCV x 50% = $62,500 TV
2. Apply Millage Rate:
   $62,500 TV x 10.0000 mills ÷ 1,000 = $625.00
3. Adjust for RZ Taxable Portion:
   $625.00 x 75% = $468.75
4. Final Reimbursement Amount: $468.75

What Reports are Available?

To assist municipalities with understanding and reconciling their 2024 SBTE reimbursements, Treasury has made the following reports available on the 2024 SBTE Reimbursements website:

• Distribution by Payee: Lists the total reimbursement amount issued to each payee.
• Distribution by Millage: Provides a breakdown of the reimbursement by millage type and rate.
• Calculation by Millage: Details how each reimbursement was calculated, including the total taxable value of all SBTEs within the municipality, millage rate and applicable TIFA capture adjustments.
• SBTE Reimbursement TIFA Capture: Details how SBTE reimbursement amounts are captured and reimbursed to TIFAs via Form 6098.

How should SBTE Reimbursements be Recorded?

For counties, cities, villages, townships, libraries, local authorities, and tax increment finance authorities, record SBTE reimbursement revenue to:

• Revenue account 569, State Grants – Other

For local school districts and intermediate school districts, record SBTE reimbursement revenue to:

• Revenue major class code 321, suffix 0000

What is the timeline for SBTE Reimbursements?

• The 2024 SBTE reimbursements were issued on March 12, 2026.
• Please note: The 2024 SBTE reimbursements have been delayed due to implementation of this new reimbursement program and the large volume of data involved in processing claims across the state. Treasury appreciates your patience and cooperation as we work to ensure accurate reimbursements.
• Going forward, SBTE Reimbursements will be issued annually in May, immediately following the tax year of the exemption. For example, municipalities will be reimbursed for 2025 SBTE claims in May 2026.

Have a Question?

For more information or questions regarding SBTE reimbursements, please visit Small Business Taxpayer Exemption (SBTE) Reimbursements or contact Treasury by emailing [email protected] or calling 517-335-7484.