Michigan (MI) Paycheck Calculator 2026

What changes for Michigan retirees and Flint workers

From tax year 2026 the retirement and pension subtraction created by the Lowering MI Costs Plan (Public Act 4 of 2023) is fully phased in: any retiree can use the phase-in method to subtract up to 100% of eligible retirement benefits, regardless of birth year. Retirees can still choose the birth-year tier method or the public-safety retiree method if it works out better.

Public Act 24 of 2025 also lets taxpayers born after 1952 and aged 67 or older claim both the standard deduction and the Social Security deduction for tax years 2026 through 2028, without reducing one by the other.

City of Flint income tax moves to the Michigan Department of Treasury from January 1, 2027. Flint returns for tax year 2026 are filed with Treasury and are due April 15, 2027 instead of April 30, and Flint estimated payments move from the 30th to the 15th starting with tax year 2027. Detroit returns are already processed by Treasury.

Form MI-W4 and the Michigan withholding formula

Every Michigan employer must get a Form MI-W4, Employee’s Michigan Withholding Exemption Certificate, from each employee, and the federal W-4 cannot be used in its place. Withholding is 4.25% of your pay after subtracting $5,900 a year for each exemption you claim (yourself, your spouse if not claimed elsewhere, and each dependent), divided across your pay periods.

Example: a single worker earning $60,000 with one exemption and paid bi-weekly has $2,307.69 of wages per check, less $226.92 for the exemption, so Michigan withholding is about $88.43 per paycheck. Each extra dependent claimed lowers withholding by about $9.64 per check.

City income taxes: Detroit and 23 other cities

Twenty-four Michigan cities levy their own income tax on top of the state’s 4.25%. Most charge 1% for residents and 0.5% for nonresidents who work in the city; Detroit charges 2.4% for residents and 1.2% for nonresidents.

Our calculator does not add a city tax by default because most of Michigan has none. For a Detroit resident earning $60,000, adding 2.4% brings take-home pay to about $1,794 per bi-weekly check, with roughly $55 going to the city before any city exemptions. Enter your city’s rate in the calculator to match your situation.

Working across state lines: six reciprocal states

Michigan has reciprocal agreements with Illinois, Indiana, Kentucky, Minnesota, Ohio and Wisconsin. A resident of one of those states working in Michigan is not subject to Michigan income tax or withholding, and a Michigan resident working there pays only Michigan. That covers Toledo-area commuters into southeast Michigan and Michigan residents working in northern Indiana or Wisconsin.

Reciprocity applies only to state tax. An Ohio resident working in Detroit still owes Detroit’s nonresident city tax. A Michigan resident commuting to a state outside the list, such as Pennsylvania or New York, has that state’s tax withheld and claims a credit on the MI-1040.

Michigan has no state disability or paid family leave payroll tax deducted from employees, so beyond federal taxes and FICA, the only lines are state income tax and, in some cities, city income tax.

Bonuses paid separately from regular wages are withheld at a flat 4.25%, with no exemption allowance. Michigan employers that send a Michigan resident to work temporarily in another state must keep withholding Michigan tax on that pay.