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For those that have filed Form 5278, "Affidavit and Statement for Eligible Manufacturing Personal Property and Essential Services Assessment (ESA)", the local assessor's office has transmitted this information to the Department of Treasury to create an Electronic ESA Statement (Statement). The ESA is a State-specific tax on eligible personal property owned by, leased to or in possession of an eligible claimant as of Dec. 31 of the year immediately preceding the assessment year. The tax is collected by the State, not the local assessor's office. The Statement will be available for taxpayer viewing as of May 1 via the Michigan Treasury On-Line System (MTO).
Taxpayers must be registered with the MTO system to gain access to view the Statement. After reviewing the Statement and agreeing with the assessment, the Statement is submitted as a "certified Statement" either through the MTO or through e-file. Paper Statements will not be accepted. A valid federal employer identification number is required to certify the statement (as used on the Form 5278).
Amending a return (Form 5278) must be done prior to certifying the Statement. A taxpayer may amend a return through MTO or e-File on or before Sept. 15 of the tax year. An amendment includes adding or removing a parcel.
Taxpayers or their authorized preparer will be able to utilize the MTO to view their Statement, view correspondence from the Treasury, make changes to their Statement, certify the Statement and pay the ESA tax. Taxpayers are required to make payment in full, using MTO or Electronic Funds Transfer (EFT) by Aug. 15. Payments cannot be mailed to the Department of Treasury.
Failure to submit a certified Statement and pay the ESA tax by Aug. 15 shall incur late penalties at a rate of one percent per week, up to maximum of five percent of the total amount due and unpaid. For a taxpayer's first assessment year, the penalty shall be waived if the Statement and full payment are submitted by Sept. 15. Taxpayers can pay the ESA tax and penalties by using MTO or EFT no later than Oct. 15 Taxpayers who fail to submit a certified Statement and pay in full, including any late penalties, by Oct. 15, shall be subject to rescission of their personal property tax exemption.
A taxpayer may appeal an assessment, a penalty, or rescission by filing a petition with the State Tax Commission (form to be released at a later date). The petition must be filed by Dec.31 in that tax year.
Below is a summary of the key dates relating to the ESA:

 

Key Dates - 2016

•    Feb. 22 - Form 5278 was due to local assessor's office. This form is filed annually.
•    May 1 - Electronic ESA Statement available (invoice for taxes due).
•    Aug. 15 - Completed Statement and full payment due to Department of Treasury.
•    Sept. 15 - Late filing penalty waived for first assessment year if filed and paid by this date. Last day for filing on-line amended Form 5278 returns.
•    Oct. 15 - Late filed statement and penalty due.
•    Dec. 5 - State Tax Commission issues order to rescind exemption.
•    Dec. 31 - Deadline to file an appeal to the State Tax Commission.

 

For more information or questions on this topic, please contact your local UHY LLP professional at UHY LLP or visit us on the web at www.uhy-us.com.