A Chicago Tribune article last month (now gone) took a look at Michigan’s senior tax breaks, calling them “the most generous in the nation.” Some highlights:
- Michigan exempts all Social Security and public pension benefits from income taxes, as well as up to $45,120 a year for a single return and $90,240 on a joint return in private retirement and pension benefits, a cap that increases annually with inflation.
- Taxpayers aged 65 or older also get to deduct up to $10,058 on a single return or $20,115 on a joint return in interest, dividends and capital gains. The deduction is reduced by any deduction for retirement and pension benefits.
- Those 65 and over get double the $2,300 annual tax exemption other taxpayers get.
- Seniors can claim a larger proportion of their property taxes in figuring their homestead property tax credit on their income taxes. The average credit for seniors is more than 1.5 larger than the average credit for other filers.
- The home-heating credit allows low-income seniors to claim extra exemptions which increases the available credit.
You can get all the details on Michigan’s tax benefits for seniors from the State of Michigan.