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Michigan residents must pay state income taxes and file returns annually. The state is one of 10 nationally with a flat-rate income tax where you pay the same tax rate regardless of your income.
Michigan personal income tax rates: Table
All Michigan residents pay the same tax rate.
|Michigan personal income tax rates|
|Tax rate||Single||Married, filing jointly|
|4.25%||Greater than $0||Greater than $0|
|Source: Michigan Department of Treasury|
Michigan does not offer standard deductions for taxpayers to claim. It does provide exemptions. Single taxpayers receive a $4,900 exemption, while married households can claim $9,800. You also receive a $4,900 exemption for each qualifying dependent.
Who has to file Michigan state taxes?
Full and partial-year residents must file a state income tax return. You must also file if you were a remote worker earning income from a Michigan-based business. Meanwhile, if you reside in a reciprocal state (Wisconsin, Ohio, Indiana, Illinois, Kentucky or Minnesota) and generate income from business transactions or gambling winnings in Michigan, you also need to file a tax return.
Further, Michigan businesses need to pay state business taxes. The top business tax rate is 6 percent.
Michigan sales tax rate: Table
Michigan residents pay a sales tax on goods and services.
|Michigan sales tax rate|
|Sales tax rate||National rank|
|Source: Tax Foundation|
Unlike some states where their sales tax rate consists of state and local taxes, Michigan does not allow city or local governments to impose sales tax.
Other things to know about Michigan state taxes
Michigan imposes taxes when you buy cigarettes or gasoline. The gas tax is 41.98 cents per gallon. Meanwhile, the cigarette tax is $2.00 per 20-pack.
If you have questions about your tax eligibility or want to file online, the Michigan Department of Treasury is a wise resource to access. There, you can also make payments on property taxes, claim a tax refund and learn more about the state’s tax credits. Businesses can also use the website to register their company, make estimated tax payments and much more.