Who Must File a Tax Return in Michigan?

The Michigan Department of Treasury recommends that any taxpayer in the state who files a federal income tax return should also file a Michigan return. However, not every taxpayer is legally required to do so. It depends on your income, whether you will have taxes due with your return, and whether you expect a refund.

Adjusted Gross Income

To determine whether you must file a Michigan return, first prepare your federal income tax return. You'll need to know your federal adjusted gross income, or AGI. If you file the federal long-form return, Form 1040, your AGI will be on Line 37. If you file the shorter Form 1040A, your AGI will be on Line 21. And if you file the condensed Form 1040EZ, your AGI will be on Line 7.

Exemption Allowances

You must file a Michigan tax return if your federal AGI is greater than your Michigan "exemption allowance." The size of your allowance depends on the makeup of your household, including how many people are in your family, whether any of them are age 18 or younger or age 65 or older and whether any of them live with disabilities. Lines 9a through 9h of the Michigan tax return, Form MI-1040, guide you through the calculation of your exemption allowance.

Taxes Due or Refunds

If your state tax withholdings during the year -- and, if you were self-employed, your estimated tax payments -- do not cover your state tax liability, then you owe money. In that case, you must file a Michigan tax return, regardless of any AGI-related calculations. On the other hand, if your tax payments during the year exceeded your state tax liability, then you are due a refund from the state -- and you can claim a refund only if you file a return. If you aren't required to file and choose not to, you will forfeit any return to which you may have been entitled.

Filing Michigan Taxes

All Michigan taxpayers must use Form MI-1040 when filing their state taxes, regardless of which federal return they used. Michigan state tax returns are due on the same day as federal returns -- usually on April 15. Michigan's Department of Treasury advises that those who file federal returns but not Michigan returns may receive an inquiry from the state asking why. So filing a state return even if you don't strictly need to can avoid a potential hassle.