Bill would give Michiganders a 50% tax credit to spur local small-dollar investing

Representative Jenkins Arno introduced House Bill 4816 on Oct. 28, 2025, proposing a state income tax credit to encourage Michigan residents to make direct, small-dollar investments in qualified Michigan businesses. The credit would equal 50% of an investor’s qualified contribution, testimony illustrated a $6,000-per-year investment cap that would produce a $3,000 maximum credit, the proponents said. The credit would be claimed after an investment is made and could be carried forward for up to 10 years if not fully used.

Proponents told the House Committee on Finance the credit is intended to activate so-called retail investors — nonaccredited individuals — to participate in local business ownership and to recirculate capital within communities. Chris Miller, a special projects consultant at Plain Wave in Lenawee County, said Michigan once built local economies through localized reinvestment and that today much capital “exits our communities.” He said the bill builds on prior Michigan policy, including the 2013 Michigan Invest Locally…