No. The deduction provided under MCL 208.1201(2), commonly know as the FAS
109 deduction, does not apply to a taxpayer that does not keep its books in
accordance with GAAP.
The plain language of the statute makes clear that only taxpayers that use GAAP
qualify for the credit. Section 201(3) states
The deduction ... shall not exceed the amount necessary to offset the net
deferred tax liability of the taxpayer as computed in accordance with
generally accepted accounting principles.
A cash method or cash basis taxpayer may take the deduction to offset the
book-to-tax difference or deferred tax liability if that taxpayer keeps its
books in accordance with GAAP.
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