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Yes a Michigan NOL can be used on MI Form 1040CR. However you must have a corresponding f ederal NOL and the MI NOL is limited to your household income. ie. NOL is 50,000, household income is 45,000 Max usable NOL is 45,000
Per the instructions on MI Form 1045 :To determine household income for purposes of computing thehomestead property tax credit, the home heating credit, and thefarmland preservation tax credit, an NOLD is allowed. The amountof the NOLD that is allowed cannot exceed your FMTI in the yearto which it is being carried back or carried forward. Claim theamount of the allowed NOLD on the “other adjustments line” onthe appropriate credit forms for each applicable year. Caution:To deduct an NOLD from household income, you must have acorresponding federal NOLD. If you have a Michigan NOLD,but no federal NOLD, you cannot take an NOLD in householdincome. Income and losses from other states, income and lossesfrom oil and gas production, and federal itemized deductions, mustbe considered when calculating the NOL and NOLDs used forhousehold income. The amount of the allowable NOLD for use inhousehold income is calculated on page 3 of the MI-1045 form forboth carrybacks and carryforwards. The amount of the carrybackdeduction will be the smaller of lines 46 or 47, and the amount ofthe carryforward deduction will be the smaller of lines 46 or 52.Example: Your 2004 FMTI is $20,000, and your 2004 federalNOLD is $50,000. The amount of the 2004 NOLD of $50,000 thatmay be used in 2004 household income is limited to $20,000. Thebalance of $30,000 will be available for use in 2005 to the extentof your 2005 FMTI.
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