Michigan Income Tax Withholding and Payroll Information

Compliance with state taxes is required for every employer. Learn about the flat rate, deductions, and automation options below.

December, 17th 2024

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Each state has unique requirements for income tax withholding. Below you will find the details for Michigan’s 2025 withholding structure, which utilizes a flat tax rate, along with applicable standard deductions and allowances.

Employers must also adhere to federal income tax withholding rules. More information can be found here about federal rates .

Alternatively, employers can automatically calculate payroll withholding using ezPaycheck.

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Michigan Tax Information

General Information
State Abbreviation	MI
State Tax Withholding State Code	26
Acceptable Exemption Form	MI W-4 or federal W-4
Basis For Withholding	State Standard Deduction and Allowances
Acceptable Exemption Data	0/ Number of Allowances
TSP Deferred	Yes
Special Coding	Determine the Total Number Of Allowances field as follows: Second and Third Positions - Enter the number of exemptions claimed (Line 6 on the MI-W4).
Additional Information	None

Deductions, Allowances, Taxes, and Exemptions

Standard Deduction Table (2025)
Filing Status	Standard Deduction
Single, Married (Dual Income), Other	$5,800
Head of Household	$5,800
Married Filing Jointly (Single Income)	$5,800

Tax Withholding Table: All Filing Statuses
If Taxable Income Is		Tax Withholding
Over	But Not Over			Rate	Of Excess Over
$0	and over	$0	+	4.25%	$0

Since Michigan uses a flat tax rate, the tax withholding is simply 4.25% of the taxable income.

How to Calculate Michigan Taxes

Subtract the nontaxable biweekly Thrift Savings Plan (TSP) contribution from the gross biweekly wages.
Subtract the nontaxable biweekly Federal Health Benefits Plan payments (includes dental, vision insurance program, and flexible spending account - health care and dependent care deductions) from the amount computed in Step 1.
Add taxable fringe benefits (e.g., taxable life insurance) to the amount computed in Step 2 to obtain the adjusted gross biweekly wages.
Multiply the adjusted gross biweekly wages by 26 to obtain the gross annual wages.
Subtract the appropriate standard deduction (based on filing status) from the gross annual wages to determine the taxable income.
Calculate the gross tax by applying the flat 4.25% rate to the taxable income:
Gross Tax = Taxable Income × 4.25%
Add any additional withholding (if applicable) to the net tax.
Divide the final annual Michigan tax withholding by 26 to obtain the biweekly Michigan tax withholding.

Michigan’s flat tax rate simplifies the tax calculation process. If you prefer to automate these calculations, consider using ezPaycheck.

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Automate Payroll with ezPaycheck

ezPaycheck is easy-to-use payroll software designed with small businesses in mind: simple, reliable, and affordable. It helps you calculate taxes, print paychecks for employees & contractors, generate reports, and print tax forms. No internet connection needed.

Try it free for 30 days with no obligation and no credit card needed. ezPaycheck is available for both Windows and Mac computers.