According to the Michigan Instructions for Form 4884, "Retirement and pension benefits are taxed differently depending on the age of the recipient. Married couples filing a joint return should complete Form 4884 based on the year of birth of the older spouse."
Recipients born before 1947 may deduct all qualifying pension and retirement benefits received from public sources or federal sources and may deduct qualifying private pensions and retirement benefits up to $52,808 for single or married filing separate, or $105,615 for a married filing a joint return.
Recipients born from January 1, 1946 through January 1, 1953 do not complete Form 4884. See Schedule 1, line 24.
Recipients born on or after January 1. 1954 but before January 2, 1959 who have reached age 62 and receive retirement benefits from employment exempt from Social Security may deducts up to $15,000 in qualifying pension or retirement benefits, or $30,000 if both spouses on a joint return receive Social Security exempt retirement benefits.
Recipients born after 1953, received retirement benefits from SSA exempt employment. and were retire as of January 1, 2013 may deduct up to $35,000 in qualifying pension and retirement benefits if filing as single or married filing separate, or $55,000 if married filing a joint return. The maximum deduction increased to $70,000 if both spouses on a joint return qualify.
All other recipients born after 1953, all retirement and pension benefits are taxable and you are not entitled to a pension subtraction.
To locate this section within your Michigan return, follow the steps below:
- State Section
- Subtractions from Income
- Deductions for Taxpayers Born before 1954
For additional information, see:
- MI-1040 Instructions
- Form 4884
- Michigan Retirement Benefits Chart
- Is my military pension/retirement income taxable to Michigan?