How MICHIGAN Taxes Retirees (VIDEO)

Once again you have to look beyond the top line numbers to factor how Michigan taxes retirees.

No tax on Social Security income. A large standard deduction of $20k per person who is over the age of 67.

So, say you have $40k in Social Security and $40k in IRA distributions, you pay 0 income tax to the state, even though it appears they are a “high tax” state.

Property tax RATE is high, but actual dollar amount of property tax will be quite low comparatively speaking because the housing values in Michigan are relatively low.

Sales tax is a flat 6%. From the state side of things that seems high. But there is NO OTHER sales tax added. No county or local sales tax.
What does that mean? Your sales tax in Michigan is pretty low.

All in all, a retiree with less than $100k income is going to do just fine in Michigan, at least in terms of taxation. The cold is a different thing altogether!

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