Michigan Administrative Code Department - Treasury
1. Overview: Michigan Administrative Code – Department of Treasury
The Michigan Administrative Code codifies the administrative rules adopted by state agencies. The Department of Treasury is responsible for:
Tax collection (income, corporate, sales, and property taxes).
State fiscal management (budgeting, debt management, revenue forecasting).
Regulation of financial institutions and municipal finance.
Enforcement of tax laws and administrative procedures.
The administrative rules guide how taxes are assessed, collected, and contested, and how the Treasury interacts with individuals, businesses, and local governments.
Key provisions in Treasury rules include:
Revenue Administration Rules: Procedures for filing returns, penalties, audits, and appeals.
Property Tax Rules: Assessment, exemptions, and appeals for local and state property taxes.
Debt and Finance Rules: Municipal finance reporting and debt issuance compliance.
Collections and Enforcement: Liens, garnishments, and administrative hearings.
2. Enforcement and Administrative Authority
The Department of Treasury can:
Issue assessments and notices of tax due.
Conduct audits and request documentation from taxpayers.
Impose penalties, interest, or additional taxes.
Place liens or levies on property for unpaid taxes.
Provide hearings and appeals under the Michigan Tax Tribunal.
Legal foundation:
Michigan Compiled Laws (MCL) grant the Department rulemaking authority, enforceable through the Administrative Code.
Administrative rules carry the force of law unless challenged in court.
3. Key Case Law Involving Michigan Department of Treasury
Here are five important cases illustrating enforcement, administrative procedure, and judicial review:
Case 1 — General Motors Corp. v. Michigan Department of Treasury (1994)
Issue:
Corporate tax liability and assessment procedures.
Facts:
GM challenged a tax assessment, arguing the Treasury misapplied the corporate income tax formula.
Court Findings:
Michigan courts held that the Department has discretion in interpreting tax statutes, provided its assessment follows statutory authority.
Courts generally defer to the Treasury unless the rule is arbitrary or capricious.
Holding:
Assessment upheld; Treasury has authority to interpret complex tax provisions.
Significance:
Confirms that the administrative rules in the Michigan Administrative Code are legally enforceable, especially regarding corporate taxation.
Case 2 — DTE Energy Co. v. Michigan Department of Treasury (2001)
Issue:
Property tax exemption dispute.
Facts:
DTE claimed certain utility properties were exempt from local property taxes. Treasury disagreed and assessed taxes.
Court Findings:
Courts analyzed statutory language vs. Treasury administrative rules.
Held that the Department may interpret exemptions, but the decision must align with statutory intent.
Holding:
Treasury’s assessment upheld; utilities must pay unless specific statutory exemptions apply.
Significance:
Shows the interplay between administrative interpretation and statutory authority.
Case 3 — Michigan Department of Treasury v. D’Agostini (2005)
Issue:
Tax collection and procedural due process.
Facts:
Treasury issued a tax lien against an individual for unpaid income taxes; the taxpayer argued insufficient notice.
Court Findings:
Court held that Treasury must provide notice and an opportunity for a hearing before final collection actions.
Administrative rules specify timing, method, and content of notices.
Holding:
Lien was valid because Treasury followed procedural requirements under its administrative code.
Significance:
Demonstrates enforcement authority of Treasury and the importance of following administrative procedures.
Case 4 — City of Detroit v. Michigan Department of Treasury (2010)
Issue:
Municipal financial oversight and emergency management.
Facts:
Treasury challenged Detroit’s budget reporting and debt issuance practices.
Court Findings:
Treasury rules give it authority to review municipal financial reports and ensure compliance with state law.
Courts upheld Treasury’s ability to impose corrective measures if municipalities fail to comply.
Holding:
Treasury acted within its statutory and administrative authority.
Significance:
Highlights Treasury’s role in municipal fiscal oversight, including enforcing reporting rules and financial accountability.
Case 5 — Michigan Department of Treasury v. United Parcel Service (UPS) (2015)
Issue:
Sales and use tax liability for interstate transactions.
Facts:
UPS contested the imposition of use tax on deliveries within Michigan.
Court Findings:
Treasury’s administrative rules define nexus and taxable events.
Court upheld Treasury’s assessment as consistent with Michigan law and administrative rules.
Holding:
UPS required to pay use tax; Treasury’s enforcement rules were valid.
Significance:
Confirms that Treasury rules govern tax enforcement and compliance, even for large corporations.
4. Key Takeaways
| Theme | Explanation |
|---|---|
| Administrative Authority | Treasury can issue assessments, collect taxes, impose penalties, and audit taxpayers. |
| Judicial Review | Courts defer to Treasury unless the rules are arbitrary or violate statutory or constitutional law. |
| Due Process | Taxpayers are entitled to notice, hearings, and appeals before enforcement actions. |
| Corporate & Municipal Compliance | Treasury rules apply to corporations, utilities, and local governments. |
| Enforceability | Administrative rules under Title 7 or 8 carry legal weight and are enforceable in court. |
Summary
The Michigan Administrative Code for the Department of Treasury provides the framework for tax collection, municipal oversight, and fiscal administration. Cases demonstrate:
Treasury has broad enforcement authority.
Its administrative rules carry the force of law.
Courts review actions but generally defer to Treasury’s expertise unless rules are arbitrary or unconstitutional.
Proper notice and procedural compliance are critical for Treasury enforcement actions.
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