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Michigan Liquor Control Commission FAQs

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The Michigan Liquor Control Commission (MLCC) has been doing a knock-out job, under the direction of Chairman Andy Deloney, in  getting more information on its website and making the licensing and regulatory process for businesses more efficient and clear, which was much needed.  

Please see below for some information the MLCC has posted to help answer some questions regarding beer, wine, and mixed spirits taxes. We have had some questions coming in on these, so we wanted to share with all our readers.

If you have any additional questions, please reach out to our government relations team at: (888) 277-6464 or BBochniak@michbusiness.org

Beer, Wine and Mixed Spirit Drink Taxes FAQs

Who pays the Beer/Wine/Mixed Spirit Drink taxes to the Liquor Control Commission (LCC)?
            Wholesale Licensees
            Direct Shipper Licensees
            Brewer, Micro Brewer, Brewpub Licensees
            Wine Maker, Small Wine Maker Licensees
            Mixed Spirit Drink Manufacturer Licensees
 
The tax reporting and payment system for Brewpub Licensees is not being changed.
 
The tax reporting and payment system for Direct Shipper Licensees is not being changed.

 
What event creates the need to pay Beer/Wine/Mixed Spirit Drink taxes to the LCC?
The taxpaying licensees must pay taxes based on their sales of Beer/Wine/Mixed Spirit Drink products.

 
When do the taxpaying licensees have to pay their Beer/Wine/Mixed Spirit Drink taxes?
The monthly tax reports and tax payments must be postmarked by the 15th of the following month. For example, the February 2015 monthly tax reports and payments must be postmarked by March 15, 2015.
 

Can the taxpaying licensee submit tax reports and payments electronically?
No. The tax reports and payments must be sent by U.S. Mail.

What if a Wholesale Licensee distributes Beer, Wine, and Mixed Spirit Drink products?
The Wholesale Licensee must submit separate tax reports and separate payments for Beer, Wine, and Mixed Spirit Drink products sold each month.

What if a Wholesale Licensee doesn’t distribute all three products (Beer, Wine, and Mixed Spirit Drinks)?
The Wholesale Licensee must submit one tax report for each of the three types of products at the beginning of each calendar year. The Wholesale Licensee should report either the months sales (if any) for each type of product or include a statement that says the Wholesale Licensee does not distribute that type of product. Then for the remainder of the calendar year the Wholesale Licensee only needs to submit tax reports and tax payments for those types of products that they distribute. It will be the responsibility of the Wholesale Licensee to notify the LCC of any changes in the types of products that they distribute. For example, a Wholesale Licensee who only distributes Beer and Wine will submit all three tax reports for January and then just submit Beer and Wine reports for the other eleven months of the year.
 
What are the Wholesale Licensee reporting requirements?
The Wholesale Licensee must submit monthly tax reports, tax payments, and sales invoices (or computer reports that contain all of the same information as the sales invoices) to support the tax reports. Also, the Wholesale Licensee must submit their Beer, Wine, and Mixed Spirit Drink purchase invoices each month (or a computer report that contains all of the same information as the purchase invoices). All reports, tax payments and invoices should be postmarked by the 15th of the following month.

Source: MLCC website: http://www.michigan.go/lara/0,4601,7-154-35299_10570-347566–,00.html

The Affordable Care Act: Exemptions from the Health Insurance Marketplace Fee

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Like many American’s across the nation, we are heading towards the end of the year, tying up loose ends, and in the middle of preparing for our next slew of holiday festivities. In the spirit of the busy holiday season, we wanted to share some important information that may help certain individuals avoid the Insurance Marketplace Fee. We don’t want you to miss this!!

The U.S. Department of Health and Human Services has compiled a list of “exemptions” that are worth taking a look at.

Exemptions from the Health Insurance Marketplace Fee
If you don’t already have health coverage, the Health Insurance Marketplace offers a way to find and buy health coverage. Starting in 2014, every person in the United States must have minimum health coverage or must pay a fee on their federal tax return. This fee is sometimes called the “individual shared responsibility payment.” In some cases, you may be able to get an exemption from the fee. An exemption means you wouldn’t have to pay the fee.

How much is the fee?
In 2014, the yearly fee is 1% of your income for the year or $95 per person in your household, whichever is higher. The payment for uninsured children under 18 is $47.50 per child. Regardless of the number of people in your household, the most a family would have to pay in 2014 is $285. You make the payment when you file your 2014 taxes, which are due in April 2015.

The fee increases every year. In 2015, it will be 2% of income or $325 per person in your household, whichever is higher. The payment for uninsured children under 18 will be $162.50 per child. In 2016, it will be 2.5% of income or $695 per person, whichever is higher.

Who can get an exemption?
You may not have to pay the fee (qualify for an exemption) if:

• You’re uninsured for less than 3 months of the year.
• The lowest-priced coverage available to you would cost more than 8% of your household income.
• You don’t have to file a tax return because your income is too low.
• You’re a member of a federally recognized American Indian tribe or eligible for services through an Indian Health Services provider.
• You’re a member of a recognized health care sharing ministry.
• You’re a member of a recognized religious sect with religious objections to insurance, including Social Security and Medicare.
• You’re incarcerated, and not awaiting the disposition of charges against you.
• You’re not lawfully present in the U.S.

Who can get an exemption? (continued)
You may qualify for a “hardship” exemption if:

• You were homeless.
• You were evicted in the past 6 months or were facing eviction or foreclosure.
• You received a shut-off notice from a utility company.
• You recently experienced domestic violence.
• You recently experienced the death of a close family member.
• You experienced a fire, flood, or other natural or human-caused disaster that caused substantial damage to your property.
• You filed for bankruptcy in the last 6 months.
• You had medical expenses you couldn’t pay in the last 24 months.
• You experienced unexpected increases in necessary expenses due to caring for an ill, disabled, or aging family member.
• You expect to claim a child as a tax dependent who’s been denied coverage in Medicaid and the Children’s Health Insurance Program (CHIP), and another person is required by court order to give medical support to the child. In this case, you don’t have to pay the penalty for the child.
• As a result of an eligibility appeals decision, you’re eligible for enrollment in a qualified health plan (QHP) through the Marketplace, or lower costs on your monthly premiums, or cost-sharing reductions, for a time period when you weren’t enrolled in a QHP through the Marketplace.
• You were found not to be eligible for Medicaid because your state didn’t expand its Medicaid program.

How do I apply for an exemption?
How you apply—and even if you need to apply—depends on which exemption fits your situation.

For an exemption based on coverage being unaffordable, membership in a health care sharing ministry, membership in a federally-recognized tribe, or being incarcerated, you have 2 options to apply:

• Claim these exemptions when you fill out your 2014 federal tax return, which is due by April 15, 2015
• Fill out an exemption application in the Health Insurance Marketplace

Note: If you get an exemption because coverage is unaffordable based on your expected income, you also may qualify to buy catastrophic coverage through the Marketplace. This may be more affordable than your other options.

How do I apply for an exemption? (continued)

For an exemption based on membership in a recognized religious sect whose members object to insurance, eligibility for services through an Indian health care provider, or one of the “hardship” exemptions:

• Fill out an exemption application in the Health Insurance Marketplace

For an exemption if your income will be low enough that you won’t be required to file taxes:

• You don’t need to apply for an exemption. This is true even if you file a federal tax return to get a refund of money withheld from your paycheck. You won’t have to pay this fee.

For an exemption if you have a gap in coverage of less than 3 months, or if you’re not lawfully present in the U.S.:

• You don’t need to apply for an exemption. The Internal Revenue Service will handle this when you file your taxes.

Where can I get more information?
Visit HealthCare.gov, or call the Health Insurance Marketplace call center at 1-800 318-2596 for more information. TTY users should call 1-855-889-4325.

Source: Department of Health and Human Services, Health Insurance Marketplace

Let MBPA Get You Connected!

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As we talk around the dinner table with family, especially around the holidays, politics always finds its way into conversation. If you find you wanted to continue that discussion beyond the dinner table and pass your thoughts onto local or state government, this information is for you!
 
Please contact our government relations team, and have them set up a meeting with your state legislator either in your district or at our state’s Capitol in Lansing. It truly makes a difference when you participate in government and voice your opinion to those elected to represent you.

Contact our government relations team by phone at: (888) 277-6464 or by email: bbochniak@michbusiness.org

MLCC Tips for a Safe and Successful Holiday Season

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The holidays bring with them increased liquor sales and added crowds to area restaurants, bars and other businesses. The Michigan Liquor Control Commission (MLCC) has offered the state’s 17,000 liquor licensees tips for a safe and successful holiday season.
 
“Liquor licensees and their businesses contribute billions of dollars to Michigan’s economy and help create thousands of good paying jobs. Staying in compliance with regulations will help licensees avoid fines and penalties, grow business, and safeguard their establishment and customers,” said MLCC Chairman Andy Deloney. “Whether you’re a bar, restaurant, convenience store or brew pub, it’s important to remind your employees of the state’s laws. Educate management and staff to apply all policies consistently to ensure a safe and successful holiday season.”
 
A printable pdf version is also attached. Click Here.

Member Alert: Cloud 9 Synthetic Drugs; Not Allowed in Stores

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The Michigan Business & Professional Association (MBPA) is alerting its members to a very serious health issue that is harming our youth. Cloud 9, the most recent synthetic drug to reach teenagers and pre-teens is being readily sold in convenience stores. Both Macomb and Wayne County Health Departments have issued emergency orders denying all retailers and individuals the ability to sell Cloud 9 and similar synthetic drugs throughout both counties.

Cloud 9 has been more prevalent in southeast Michigan, but our call-to-action is state-wide. The MBPA stands alongside the emergency orders that have been issued, and asks that if anyone is aware of businesses selling
and/or repacking Cloud 9 or similar synthetic drugs to please contact your local enforcement agency.

Cloud 9 is a clear liquid with no aroma that can be inconspicuously consumed in an e-cigarette and is hard to detect on a drug test. This drug is sold primarily in eyedropper bottles, and is often used with e-cigarettes.

Useful Contact Information:

• Macomb County Health Department: (586) 469-5235
• Wayne County Health and Human Services: (734) 727-7000
• State Department of Community Health: (517) 373-3740

Please contact our government relations team with any questions or comments at: (888) 277-6464 or email: bbochniak@michbusiness.org.

Announcing Medicaid Enrollment Services

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MBPA could help save you thousands of dollars in health care premiums and avoid possible penalties.

With Michigan’s expanded Medicaid program, you could have employees that may be eligible to enroll in the Healthy Michigan Plan, which could save an employer thousands of dollars annually in health care premiums.

If you are an “applicable large employer” who currently does not offer coverage to substantially all of its full-time employees, this would be a proactive way to assist your employees in obtaining health care coverage before the ACA employer shared responsibility penalties take effect. (Applicable large employers with 50-99 full-time equivalent employees (FTE) will be subject to the employer shared responsibility penalties beginning in 2016. Those with 100 or more FTEs will need to start offering health benefits to at least 70% of their FTEs by 2015 and 95% by 2016 in order to avoid potential penalties).

If just 5 employees qualify and choose to enroll in the Healthy Michigan Plan, the employer could potentially save a minimum of $21,000.00 a year!

Although an employer cannot force or coerce employees to enroll in the Healthy Michigan Plan, by simply educating the employees on the Healthy Michigan Plan including potential cost savings to them and possibly better health coverage including lower co-pays and out of pocket expenses than their current group plan, why wouldn’t an employee choose it?

Who Could Qualify for the Healthy Michigan Plan? Individuals who…
• Are age 19-64 years
• Have income at or below 133% of the federal poverty level* ($16,000 for a single person or $33,000 for a family of four)
• Do not qualify for or are not enrolled in Medicare
• Do not qualify for or are not enrolled in other Medicaid programs
• Are not pregnant at the time of application
• Are residents of the State of Michigan

* Eligibility for the Healthy Michigan Plan is determined through the Modified Adjusted Gross Income methodology.

How can MBPA help?
MBPA’s On-Site Enrollment Team will meet individually with employees that may qualify and further evaluate eligibility requirements for the Healthy Michigan Plan. If the employee is found to be eligible and wishes to enroll in the Healthy Michigan Plan, our team will then process their application and provide the employee with any on-going enrollment assistance that may be needed. Also, we would be happy to discuss our onsite service program with your trusted health insurance advisor to ensure they fully understand how this service may benefit you and your employees.

For more information on this new program, contact Jennifer Werner (ext. 166) at 888.277.6464

Let us Make Your Business Better!

Support Proposal #1: Michigan Citizens for Strong and Safe Communities

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The Michigan Business  and Professional Association (MBPA) and the Michigan Food and Beverage Association (MFBA) both support Proposal #1 on this year’s 2014 election ballot and are part of the Michigan Citizens for Strong and Safe Communities coalition.

About the proposal:

Currently in Michigan, all businesses must pay a personal property tax on every piece of equipment they own. So not only do small businesses pay the six percent sales tax when they purchase equipment, they also pay a personal property tax for every year that they OWN the equipment.  The tax level on business personal property is unique to Michigan and has put the state at an economic disadvantage when competing for new businesses and jobs. This proposal would immediately eliminate the personal property tax on small businesses, and phase it out over nine years for larger businesses.   

Many communities rely on the money raised by the personal property tax to help fund services like education, police, fire and ambulance services even though it is an unreliable revenue source. This referendum guarantees that 100 percent of the money a community loses from the elimination of the personal property tax, will be replaced using the more stable State Use Tax.

The referendum, on the August 5, 2014 ballot, is not a tax increase.  It is paid for by eliminating special corporate tax breaks the legislature has voted to end, and by establishing a statewide Essential Services Assessment paid only by manufacturers receiving a Personal Property Tax reduction.

We encourage you to voice your support and vote YES this August 5th, 2014 on Proposal #1!  Please visit the coalition’s website for more information: www.StrongAndSafeCommunities.com

Michigan Legislates New Minimum Wage Law

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May 27th, 2014 the Michigan legislature passed, and Governor Snyder signed, a new minimum wage law giving it immediate effect. The bill would repeal the existing minimum wage law and replace it with a new statute, Michigan Public Act 138 which is officially named the Workforce Opportunity Wage Act. Beginning this September, the current minimum wage in Michigan of $7.40/hour, which has been in effect for several years, will increase to $8.15/hour.

Tipped employees’ minimum wage will increase to $2.93/hour in September as well.
 
This initial increase in September marks one of a series of increases to the state minimum wage that will go into effect.

The following details subsequent scheduled increases:

Beginning January 1, 2016, $8.50.
 
Beginning January 1, 2017, $8.90.
 
Beginning January 1, 2018, $9.25.

Additional highlights from the bill include:

-an inflation adjustment provision that goes into effect in January 2019. The provision will implement automatic increases to the minimum wage based on the increase to the Consumer Price Index (CPI) for the Midwest region. The formula will be calculated on an average annual change in the CPI for the most recent five-year period. The new rate will be posted each year on February 1st. The Michigan State Treasurer will adjust the average annual rate and it will go into effect beginning April 1st of that same year. Any increase will be capped at 3.5%. 
 
-any increase prescribed will not take effect if the state’s unemployment rate as determined by the federal Bureau of Labor Statistics is over 8.5% for the preceding year.
 
-by repealing the old law and enacting an entirely new minimum wage law, legislators disrupted the Michigan ballot initiative that would have increased the minimum wage to $10.10/hour and, increased the tipped workers’ minimum wage up to the regular minimum wage.

-new employees under 20 years of age, their employers will be allowed to set a training wage of $4.25/hour for the first 90 days of employment. If the new employee is under 18 years of age when the 90-day training period ends, that employee can be paid 85% of the general minimum wage at that time. The law calls for a fine of $1,000 against any employer who “switches out” or otherwise displaces a young worker because he or she reached 18 years of age.

– tipped workers will receive a new minimum wage that will be set to 38% of the minimum wage if all of the following occur:
 
•    The employee receives gratuities in the course of his or her employment.
•    If the gratuities described in subdivision (a) plus the minimum hourly wage rate under this subsection do not equal or exceed the minimum hourly wage otherwise established under Section 4, the employer pays any shortfall to the employee.
•    The gratuities are proven gratuities, as indicated by the employee’s declaration for purposes of the federal insurance contributions act, 26 USC 3101 to 3128.
•    The employee was informed by the employer of the provisions of this section.

Since the new law abolished the existing Minimum Wage law, the old wage and hour statute was included in the new language. Exemptions from the minimum wage law, such as for certain public employers and the Executive, Professional and Administrative exemptions that most employers are familiar with from the federal wage and hour laws continue to be included without any change. 

Please contact our government relations team with any questions or comments.  Your feedback is always welcome.

Email: bbochniak@michbusiness.org   or by phone: 586-393-8800, ext. 401.

Health Insurance Claims Assessment

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Governor Snyder has officially signed legislation that reintroduces a 6% Use Tax assessed on Medicaid managed care organizations and a separate bill that decreases the 1% Health Insurance Claims Assessment (HICA) to 0.75% effective July 1, 2014. The welcome legislation is being heralded by small business in Michigan as a win for their bottom lines.

For over a decade, Michigan has creatively crafted several health care provider assessment programs to leverage additional federal Medicaid match dollars. The intent is to increase reimbursement rates to Medicaid providers while simultaneously incentivizing these providers to accept more Medicaid patients. As federal laws have changed, Michigan has been forced to adapt and create new assessment vehicles. As such, in 2009 Michigan applied a 6% Use Tax on Medicaid managed care organizations. In 2012, after growing concerns of a federal change, the legislature removed the use tax assessment and instead adopted a 1% tax on most health care claims. Revenue estimates have consistently fallen short of the needed dollars, thus creating a funding imbalance in the budget. The legislature has been looking for a structural fix for years. Hence, with original fears of a federal interpretation change placated, SB’s 893 and 913 were adopted this year in hopes of finally addressing the shortfall and providing a tax decrease for businesses in Michigan.

SB 893 reinstates the 6% Use Tax on Medicaid managed care organizations. SB 913 uses a portion of those savings to decrease the 1% HICA to 0.75%. SB 913 also preserves the December 31, 2017 HICA sunset (elimination). The bill also stipulates that should the federal government prohibit the Use Tax assessment of Medicaid managed care providers in the future, the HICA would bump back up to 1%. Senate Bill 893 includes a cap on combined revenues generated between the Use Tax and HICA of $450 million. Any revenue in excess of the cap would be credited back to HICA payers in fiscal year 2015-16.

More Chances To Win Coming for Daily 3 and Daily 4 Players by M. Scott Bowen, Commissioner

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Summer is heating up for Michigan Lottery players and retailers! Sales of Lottery tickets continue to be strong, and are running ahead of last year’s record sales pace of $2.5 billion.

To help keep Lottery player traffic coming to our retail partners this summer, we are rolling out exciting promotions for the Daily 3 and Daily 4 games. Each of the promotions is designed to attract players and offer them more chances to win.

Beginning July 1, Straight Back Bonus returns to the Lottery’s Daily 4 game and gives players the chance to win $1,000 if their straight bet numbers are drawn in reverse order. For example, if a player plays a straight bet for 8-6-4-2 and the numbers drawn are 2-4-6-8, they win $1,000. This promotion doubles the chances to win for all straight bet wagers. Best of all, the Straight Back Bonus automatically is applied to all Daily 4 straight bets with no extra work from retailer personnel!

Another exciting promotion for daily draw games will begin on Aug. 3, when Daily 3 and Daily 4 players will have a new bet type option. The 1Off bet type gives players more chances to win by paying them if one of the numbers drawn is one higher or one lower than their numbers. This new bet option may be played for the midday and evening drawings and gives players seven ways to win on a Daily 3 game and nine ways  to win on a Daily 4 game.

Both of these exciting new play options give players more chances to win prizes in our popular daily games, without adding any cost to their wager.

Summer Sizzler Update
The Summer Sizzler promotion is well under way with entries for the popular second chance drawing piling up! The exciting contest allows players to enter non-winning $2 Grills Gone Wild, $5 Sizzling 7s, and $2 Red Hot Bingo instant game tickets for a chance to win.

We had more than 389,000 entries for the first drawing that took place on June 3 and awarded 10 lucky players with a camping-themed outdoor prize package and 70 winners with $200 Omaha Steaks® gift cards.

Two drawings remain in the Summer Sizzler second chance promotion. On July 1, we will give away 10 outdoor entertaining-themed prize packages and 70 $200 Omaha Steaks® gift cards. The grand prize drawing will take place on July 29, and in addition to 10 tailgating-themed outdoor prize packages, one lucky player will win a $30,000 cash prize. Entries are being accepted until 11:59 p.m. July 28, so be sure to remind players to get their entries in!

NEW INSTANT TICKETS: These tickets go on sale July 1:
    IG # 668    Neon 9’s        $2
   IG # 693    In$tant 10 Grand    $1

NEW PULL TAB TICKETS: These tickets go on sale July 7:
    MI # 523    100X the Cash        $1
    MI # 530    Fireball Slots        $.50

INSTANT GAMES SET TO EXPIRE: July 7    
    IG # 643     Family Feud        $2

PULL TAB GAMES SET TO EXPIRE: July 14
    MI # 588    Drop the Puck        $1
    MI # 592     Frosty Mug        $.50

TICKET ACTIVATION: Retailers are reminded to activate all game tickets before putting them on sale to ensure winning tickets may be redeemed by players.   

About 95 cents of every dollar spent on Lottery tickets is returned to the state in the form of contributions to the state School Aid Fund, prizes to players and commissions to retailers. In fiscal year 2013, the contribution to schools totaled $734.3 million. Since its inception in 1972, the Lottery has contributed over $18 billion to Michigan’s public education.
For additional information, please visit the Lottery’s Web site at www.michiganlottery.com.

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