LANSING, Mich. — Legislation that would ensure Michigan residents are able to claim personal exemptions on their state taxes received final approval from the Legislature Wednesday afternoon.
“Many are already seeing more money on their paychecks as a result of the recent federal tax reform,” said Sen. Marty Knollenberg, R-Troy. “The changes have been welcomed by many, but some Michigan residents have concerns about what that might mean for next tax season.”
The Federal Tax Cuts and Jobs Act lowers tax rates and doubles the standard deduction, which is good news to most. However, it also effectively ends the federal personal exemption by setting it to zero. Because Michigan’s current state income tax law ties the state’s personal exemptions to the federal exemption, many are unsure if they will be able to claim the exemptions on this year’s state taxes.
SB 748 would ensure Michigan taxpayers can continue claiming the personal exemption on their state income taxes and SB 750, sponsored by Knollenberg, would make the same assurance for city income tax exemptions.
“These measures will provide both clarity and relief to Michigan residents,” Knollenberg said. “When coupled with the recent federal changes, these bills will provide much-deserved relief to middle class families and their budgets.”
Both bills will now move to Gov. Rick Snyder for final approval.