Mich. Admin. Code R. 205.16 - Returned goods

Rule 16.

(1) The term "returned goods" does not include repossession or recapture of merchandise by legal process, abandonment of contract, voluntary surrender of goods without a refund or credit being given for the amount paid, or goods accepted in trade or barter.

(2) If the seller provides a full or partial refund or credit on returned goods within the time period for returns stated in the seller's refund policy or 180 days after the initial sale, whichever is sooner, the seller shall refund tax on the full amount or that portion of the purchase price that was refunded or credited. If the seller allows for a full or partial refund or credit on returned goods after the time period for returns stated in the seller's refund policy or 180 days after the initial sale, the seller may refund tax on the full amount or that portion of the purchase price that was refunded or credited. The seller may claim a refund or credit of the tax paid to the department of treasury on all or that portion of the purchase price that was refunded or credited to the seller's customer. The seller's claim for refund must be submitted to the department of treasury within 4 years after the date set for the filing of the original return for the period in which the tax was due.

(3) A refund or credit of tax must not be given on goods returned to the seller for a refund or exchange without proof that Michigan tax was paid on the original sale.

(4) A rehandling or restocking charge by the seller in connection with returned goods is not a reduction of the sales or purchase price for refund purposes. Charges attributable to use of the returned goods by the purchaser are taxable.

(5) A credit or refund of tax is allowed for a motor vehicle returned to a manufacturer under 1986 PA 87, MCL 257.1401 to 257.1410, less allowances for use certified by the manufacturer on a form provided by the department of treasury.

Notes

Mich. Admin. Code R. 205.16

1979 AC; 2013 AACS; 2023 MR 15, Eff. 8/11/2023