Michigan has a flat individual income tax rate of 4.25% for the 2025 tax year. The state also has a 6% corporate income tax rate and a 6% state sales tax rate.
Michigan State Tax Rates
| Tax Type | Rate | Notes |
|---|---|---|
| Individual Income Tax | 4.25% (flat rate) | This rate applies to all levels of taxable income and all filing statuses. Some of Michigan’s 24 cities also impose local income taxes (up to 2.4% in Detroit). |
| Sales and Use Tax | 6% | Michigan does not permit local sales taxes, so this is a statewide flat rate. Groceries and prescription medications are generally exempt. |
| Corporate Income Tax | 6% | This is a flat rate for corporations. |
Key Changes and Considerations
Rate Determination: State law mandates a formulaic review to potentially reduce the individual income tax rate if general fund revenue growth outpaces inflation.
Based on the data from the fiscal year, it was determined that no reduction was required; thus, the rate remains at 4.25%.
| Save 10% on TurboTax Electronic Tax Filing! | Get this offer and save 10% on TurboTax Electronic Tax Filing! |
Retirement and Pension Benefits: Recent legislation provides expanded options for taxpayers to deduct retirement and pension benefits.
Other Taxes: Michigan does not impose an estate, inheritance, or gift tax
| Save 10% on TurboTax Electronic Tax Filing! |
| Take advantage of this offer and save 10% on TurboTax Electronic Tax Filing! |
