Michigan taxes income at a flat 4.25%, applied after a personal exemption of about $5,800 per person.
The flat rate keeps things predictable, but a handful of Michigan cities add their own income tax. Here is how the state rate works and where the local exceptions are. See your exact take-home with the free Michigan paycheck calculator.
How Michigan's income tax works
Michigan starts from your federal adjusted gross income (already net of 401(k), HSA, and health premiums), subtracts a personal exemption of roughly $5,800 for each person claimed, and taxes the remainder at a flat 4.25%. There is no separate standard deduction.
Because the rate is flat, your Michigan tax is easy to estimate: a single filer on $65,000 is taxed on about $59,200 after one exemption, for roughly $2,516 in state tax.
Your take-home on a $65,000 salary in Michigan
Here is how a $65,000 salary breaks down for a single filer, using 2025 federal and FICA figures alongside Michigan's a flat 4.25% income tax.
| Item | Annual |
|---|---|
| Federal income tax | $5,246 |
| FICA (Social Security + Medicare) | $4,973 |
| Michigan income tax | $2,516 |
| Take-home pay | $52,266 |
| Percent of gross kept | 80.4% |
On a $65,000 salary a single filer owes about $2,516 in Michigan income tax and keeps roughly $52,266 (80.4% of gross), before any city income tax. Compare with Ohio.
City income taxes and the retirement-tax phase-out
Around two dozen Michigan cities, including Detroit and Grand Rapids, levy a local income tax (about 1% to 2.4% for residents). If you live or work in one of them, add that to the 4.25% state rate.
Michigan is also phasing back its tax on retirement income under a 2023 law, so pensions and retirement-account withdrawals are becoming exempt or partly exempt depending on your age, even though wages are still taxed at the flat rate.
How to keep more of your Michigan paycheck
Traditional 401(k) and HSA contributions lower your Michigan taxable income along with your federal income, and an HSA escapes FICA too, making them an easy way to lift your take-home.