How to File a Michigan Return if I Work in Two Different States
As a Michigan resident, when you work in other states the income earned in those states may be taxed by both Michigan and the other state. You may be eligible for a credit on your Michigan income tax return on taxes paid to another state. If the work is in a state with which Michigan has a reciprocal tax agreement, it can change your tax situation in Michigan.
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Things You'll Need
- Completed federal income tax form
- W-2s
- MI-1040 form
- Schedule 1/Schedule 2 form
Instructions
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Look over the W-2s you received from your employers to determine the state taxes that were withheld from your jobs. According to Turbo Tax, boxes 15 through 17 on the W-2 show states taxes paid and boxes 18 through 20 show local and city taxes paid. This lets you know if you paid into another state or if you were working with a reciprocal state. Wisconsin, Ohio, Indiana, Illinois, Minnesota and Kentucky are reciprocal states with Michigan.
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Visit the Michigan Department of Treasury website and download your state income tax form. Select the form for the current tax year. The individual income tax form for Michigan is form MI-1040, which you can begin filling out as you normally do. Download the Schedule 1/Schedule 2 form, which is used for additions and subtractions. Download an instruction booklet as well.
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Enter in the amount of tax paid to another state on line 5a on Schedule 2. This includes both state and local taxes paid outside of Michigan.
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Calculate your credit due for paying the other state taxes by dividing the total amount of income earned in other states by your overall total income. Multiply the result by the number shown on line 17 of Form MI-1040. Enter this number on line 5b of Schedule 2. Bring your total for the credit column down to line 11 on Schedule 2 and then carry over to line 18 on MI-1040.
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Add up the amount of your estimated income tax payments and enter that amount on line 32 of Form MI-1040. You should only have a number for this line if you worked in a reciprocal state and had to make estimated payments to Michigan each quarter.
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Complete the remainder of form MI-1040 as you normally do. Enclose copies of your W-2 forms from the other states to show proof of state tax payments to other states, if you paid into other states. If you owe money to the state, send your return to Michigan Department of Treasury, Lansing, MI 48929. If you do not owe, send the return to Michigan Department of Treasury, Lansing, MI 48956.
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