TAX & LICENSE / STATE TAX SYSTEM

State Income Tax
Michigan imposes a flat income tax rate that was gradually decreased over a period of several years beginning in 2001 and is currently 4.35 percent. This rate is assessed on the federal adjusted gross income less a $3,100 personal exemption for the taxpayer and the same amount for each dependent. Special credits and other exemptions vary with the taxpayer.

Michigan residents have a number of options in filing their state income tax forms. E-file enables taxpayers to file individual income tax returns—refund and tax due—via computer rather than sending the returns through the mail. Telefiling completes the process via touch-tone telephone dialing for eligible taxpayers. Certain restrictions apply. Using the direct deposit options allows your tax return to be automatically deposited into the account of your choice rather than waiting for a mailed check.

Michigan Sales/Use Tax
Michigan state sales and use taxes are both 6.0 percent. Michigan has no city, local, or county sales tax. The sales tax applies to retail sales of tangible personal property such as clothing, automobiles, furniture, appliances, utilities, transient hotel and motel rooms and other sales at retail. Food, prescription drugs, and services are not subject to this tax.

Residents are required to pay a 6.0 percent use tax on mail order and Internet purchases from out-of-state companies that do not collect Michigan sales or use tax. This includes purchases made while on vacation or while visiting foreign countries. A special entry for calculating and paying Use Tax is included on the Michigan state income tax forms.

City Income Tax
In the immediate Grand Rapids area, only Ionia and Grand Rapids impose a municipal tax. Grand Rapids imposes a maximum income tax of 1.3 percent for residents who live and work in the city. For answers to specific questions, contact:

Grand Rapids City Tax
616-456-3415
https://www.grandrapidsmi.gov/treasury/Income-Tax

Ionia City Tax
616-527-5329
https://ioniacounty.org/departments-officials/treasurer/

Property Taxes
Property taxes are levied at the state and local levels by the state, school districts, cities, counties, townships, and other special jurisdictions. Rates range from $13 to more than $60 per $1,000 valuation depending upon the municipality. Michigan real estate is assessed at 50 percent of the market value. In general, county treasurers handle only delinquent property tax issues. For information or answers to specific questions, contact the assessor in your township or city.

Tax Information Resources

Internal Revenue Service
Information
800-829-1040
https://www.irs.gov/

Michigan Department of Treasury
517-373-3200
https://www.michigan.gov/treasury

Frequently Requested Numbers

Income Tax Information
517-636-4486

Sales/Use Tax
517-636-6925