Before you file your income tax form: 6 things to know about Michigan's changes | MLive.com
The new income tax rules impact retirement income and many different credits, such as those for certain charitable donations or for low- and medium-income families.
The changes were meant to make the tax structure "fair and efficient and address structural budget deficit that plagued the state for a number of years,” said Terry Stanton, spokesman for the Michigan Department of Treasury.
One of the biggest adjustments will reduce or eliminate the Homestead Property Tax Credit for some homeowners and renters.
The state treasury sent out informational postcards to about a half million taxpayers who are most likely to be affected by the new rules, Stanton said.
Seniors age 65 and older, taxpayers with household resources of more than $50,000 and homeowners whose property has a taxable value of more than $135,000 are most likely to be impacted.
That includes North Muskegon resident Sharon Clark, 62, who says she’s unhappy with the increased tax burden.
“This follows a new taxation on retired people’s pensions, so it’s like the people who are retired and on fixed incomes are the ones who are being slammed by this,” she said.
She also noted that some people who received the postcard didn’t understand it, and said she’s concerned for seniors and others who don’t have computers or Internet access to seek more information.
The homestead credit used to be a small portion of the tax return, but now requires a few pages that need to be filled out, said Michael Bozimowski, director of state and local tax services for Rehmann, an accounting, tax and financial planning firm with 12 locations in Michigan.
Bozimowski recommended people talk to their tax preparers early in order to gain a better understanding.
“The law has changed. It’s now a fact of life we have to deal with,” he said. “Communication and preparation, not just of the return, but of the impact, is going to be key on an individual basis.”
Free volunteer-based tax preparation is available to low- and moderate-income taxpayers. Michigan State University offers free services, along with several West Michigan colleges and universities.
Information about free e-filing options is available at www.mifastfile.org.
Here are some of the key components of the tax changes with a short description. A full explanation can be found on at www.michigan.gov/taxes.
Tax rate:
Michigan reduced its income tax rate from 4.35 to 4.25 percent in October 2012. The annualized income tax rate for 2012 is 4.33 percent and applies to all income received last year.
Exemptions:
The personal exemption was increased from $3,700 to $3,763 for 2012. It will increase to $3,900 for the 2013 tax year. The following exemptions are no longer allowed: special exemption for seniors, $600 for children age 18 and younger, and unemployment compensation greater than half of adjusted gross income.
Homestead Property Tax Credit:
The maximum $1,200 credit is no longer available to homes with a taxable value greater than $135,000. That cap does not apply to rented homesteads.
Previously, taxpayers could claim a credit if their household income was $82,650 or less. Now, taxpayers with household resources (which includes more than just income) totaling more than $50,000 will no longer receive the credit. Credits are reduced for households with resources ranging from $41,001-$50,000.
Seniors can receive the full credit if their household resources are no more than $21,000. The credit would be reduced by 4 percent for each additional $1,000 in household resources up to $30,000. Senior claimants can receive 60 percent of the credit if they have resources of $30,000 to $41,000. After that, the phase out applies. A full explanation can be found here.
Retirement changes:
Pension income taxes are based on age, and joint filers go by the age of the older person.There is no change for taxpayers born before 1946. For filers born before 1946, public pensions will continue to be exempt from income taxes, and for private pensions they can subtract up to $47,309 for single filers and $94,618 for joint filers.
Taxpayers born between 1946 and 1952 receive a smaller pension tax exemption of $40,000 for joint filers and $20,000 for single filers. They can no longer exempt public pensions or subtract for interest, dividends and capital gains.
Taxpayers born after 1952 will pay taxes on all pension income, except for Social Security and military pensions. There are certain exemptions or subtractions allowed once taxpayers turn 67. See a full explanation here.
Earned Income Tax Credit:
The Michigan Earned Income Tax Credit for low- and medium-income individuals and families is reduced from 20 percent of the federal credit to 6 percent. The average credit will drop 70 percent from $439 to $132, according to the Michigan League for Public Policy.
Other tax credits:
Non-refundable tax credits for the following expenses are no longer allowed: college tuition and fees, city income taxes, automobile donations, public contributions, donations to homeless shelters, food banks, community foundations and the Family Development Program, and contributions to medical savings accounts. Refundable credits are no longer allowed for excess adoption expenses or stillbirths.
Saturday, January 12, 2013
Moonlighting security official Barnett Jones will keep job at Detroit water department after resigning from Flint post
Moonlighting security official Barnett Jones will keep job at Detroit water department after resigning from Flint post | MLive.com
He'll keep the water department job, McCormick in a statement Friday afternoon.
"Barnett Jones is doing a finejob for us at DWSD," she said. "Jonescame to DWSD with extensive experience in security and emergency management,and a distinguished career in law enforcement that included internal affairswork."
The water department doesn't prohibit additional outside employment, McCormick said.
He'll keep the water department job, McCormick in a statement Friday afternoon.
"Barnett Jones is doing a finejob for us at DWSD," she said. "Jonescame to DWSD with extensive experience in security and emergency management,and a distinguished career in law enforcement that included internal affairswork."
The water department doesn't prohibit additional outside employment, McCormick said.
GM CEO 'cautiously optimistic' about 2013; continues to defy critics
GM CEO 'cautiously optimistic' about 2013; continues to defy critics | MLive.com
In 2012, GM accomplished a number of company milestones, including reacquiring Ally Financial Inc., which helps give the company more control over lending and leasing to potential customers; de-risking its pension plan by $29 billion for salaried employees and retirees; achieving at least 11 consecutive profitable quarters; and reacquiring 200 million shares of common stock from the U.S. Treasury Department, which plans to exit the automaker by March 2014.
In 2012, GM accomplished a number of company milestones, including reacquiring Ally Financial Inc., which helps give the company more control over lending and leasing to potential customers; de-risking its pension plan by $29 billion for salaried employees and retirees; achieving at least 11 consecutive profitable quarters; and reacquiring 200 million shares of common stock from the U.S. Treasury Department, which plans to exit the automaker by March 2014.
Is the Pure Michigan brand being misused? MEDC ad outrages right-to-work opponents
Is the Pure Michigan brand being misused? MEDC ad outrages right-to-work opponents | MLive.com
Right-to-work opponents are criticizing an advertisement in the Wall Street Journal that uses the Pure Michigan logo while touting the new right-to-work law as a reason to do business in the state.
The full-page print ad, titled, ‘What happens when Michigan makes history,’ contains the following text:
“It’s a new day for business in Michigan. Michigan is the newest Right-to-Work state.
This once-in a generation transformation has Michigan poised to become a preferred place to do business.
Michigan has also redesigned incentive programs, streamlined regulatory processes, approved legislation to eliminate personal property taxes and launched a new flat 6% business tax, giving the state its most competitive position in decades.
The perfect storm of opportunity, resources and passion is Pure Michigan.”
Right-to-work opponents are criticizing an advertisement in the Wall Street Journal that uses the Pure Michigan logo while touting the new right-to-work law as a reason to do business in the state.
The full-page print ad, titled, ‘What happens when Michigan makes history,’ contains the following text:
“It’s a new day for business in Michigan. Michigan is the newest Right-to-Work state.
This once-in a generation transformation has Michigan poised to become a preferred place to do business.
Michigan has also redesigned incentive programs, streamlined regulatory processes, approved legislation to eliminate personal property taxes and launched a new flat 6% business tax, giving the state its most competitive position in decades.
The perfect storm of opportunity, resources and passion is Pure Michigan.”
Judge baffled by support for Metro Detroit teacher convicted of sex crimes against students
Judge baffled by support for Metro Detroit teacher convicted of sex crimes against students | MLive.com
A judge sentenced a substitute music teacher to five years in prison for having sex with a 17-year-old student and exchanging lewd cellphone photos and video with two other girls, and she lambasted his many supporters, saying they apparently didn't know the extent of his misdeeds.
A judge sentenced a substitute music teacher to five years in prison for having sex with a 17-year-old student and exchanging lewd cellphone photos and video with two other girls, and she lambasted his many supporters, saying they apparently didn't know the extent of his misdeeds.
Muskegon County Republican Executive Committee to discuss prevailing wage at a free public event on Monday night
Muskegon County Republican Executive Committee to discuss prevailing wage at a free public event on Monday night | MLive.com
Comments:
alaskanwolverine
Comments:
alaskanwolverine
As a former member of the Muskegon County Republican Executive Committee, I'm glad to see them being active and reaching out publicly to address the pertinent issues of the day. I was not a popular member of the committee due to my true conservatism in economic and social issues. Sounds like the committee is on the right track now.
alaskanwolverine, Please join us Monday night. You will be welcomed now.
Editorial: Spirited mayor's race is just what Muskegon needs
Editorial: Spirited mayor's race is just what Muskegon needs | MLive.com#incart_river
With the election scheduled in November, Muskegon residents will have 10 months to take a hard look at who we say we are and what we want be as a community.
They will be able to dissect the visions presented by the candidates and chose a leader.
And they will have time to figure out how to join forces behind the new leader to turn this community into the city they see when they defend it against the bashers.
Let's begin the discussion today.
With the election scheduled in November, Muskegon residents will have 10 months to take a hard look at who we say we are and what we want be as a community.
They will be able to dissect the visions presented by the candidates and chose a leader.
And they will have time to figure out how to join forces behind the new leader to turn this community into the city they see when they defend it against the bashers.
Let's begin the discussion today.
Truancy plan will work with families, not against them, officials say in live chat
Truancy plan will work with families, not against them, officials say in live chat | MLive.com
The plan calls for schools to look at students once they have five absences, whether they are excused or not.
School personnel will decide whether the absences are cause for concern and those that are will continue to be monitored.
If a student being monitored is absent four more times, they will be referred to the prosecutor’s office, which will explain to the student’s family they could lose welfare benefits if the absences continue.
The plan calls for schools to look at students once they have five absences, whether they are excused or not.
School personnel will decide whether the absences are cause for concern and those that are will continue to be monitored.
If a student being monitored is absent four more times, they will be referred to the prosecutor’s office, which will explain to the student’s family they could lose welfare benefits if the absences continue.
Muskegon County Republican Executive Committee to discuss prevailing wage at a free public event on Monday night
Muskegon County Republican Executive Committee to discuss prevailing wage at a free public event on Monday night | MLive.com#incart_river
The federal government has its own prevailing wage laws, butMonday night's meeting will likely focus on the Muskegon County's rules, whichare similar.
Vincent Vernuccio, director of labor policy at the MackinacCenter for Public Policy, will be a featured speaker.
The federal government has its own prevailing wage laws, butMonday night's meeting will likely focus on the Muskegon County's rules, whichare similar.
Vincent Vernuccio, director of labor policy at the MackinacCenter for Public Policy, will be a featured speaker.
GOP Establishment Standing in Way of Prevailing Wage Reform
GOP Establishment Standing in Way of Prevailing Wage Reform [Michigan Capitol Confidential]
“I absolutely won’t support increasing any fees or taxes (for road improvements) as long as we have prevailing wage in Michigan,” he said recently at an Independent Tea Party Patriots Meeting in Clarkston.
“I absolutely won’t support increasing any fees or taxes (for road improvements) as long as we have prevailing wage in Michigan,” he said recently at an Independent Tea Party Patriots Meeting in Clarkston.
60,000 patients put on death pathway without being told
60,000 patients put on death pathway without being told but minister still says controversial end-of-life plan is 'fantastic'
Pathway involves the sick being sedated and usually denied nutritionand fluids
Families kept in the dark when doctors withdraw lifesaving treatment
Health Secretary Jeremy Hunt said pathway was a 'fantastic step forward'
Anti-euthanasia group said: ‘The Pathway is designed to finish people off double quick'
Pathway involves the sick being sedated and usually denied nutritionand fluids
Families kept in the dark when doctors withdraw lifesaving treatment
Health Secretary Jeremy Hunt said pathway was a 'fantastic step forward'
Anti-euthanasia group said: ‘The Pathway is designed to finish people off double quick'
Sandy Relief Dwarfs Past Aid Packages
Sandy Relief Dwarfs Past Aid Packages
The measure bill includes $150 million for what the Commerce Department described as fisheries disasters in Alaska, Mississippi and the Northeast, and $50 million in subsidies for replanting trees on private land damaged by wildfires.
....Critics are taking the sharpest aim at $12.1 billion in the amendment for Department of Housing and Urban Development emergency block grants.
Any state struck by a federally declared major disaster in 2011, 2012 or this year would qualify for the grants, and that's just about all the states, said Stephen Ellis, vice president of Taxpayers for Common Sense, a budget watchdog group.
Only South Carolina, Arizona and Michigan would not qualify, he said.
The measure bill includes $150 million for what the Commerce Department described as fisheries disasters in Alaska, Mississippi and the Northeast, and $50 million in subsidies for replanting trees on private land damaged by wildfires.
....Critics are taking the sharpest aim at $12.1 billion in the amendment for Department of Housing and Urban Development emergency block grants.
Any state struck by a federally declared major disaster in 2011, 2012 or this year would qualify for the grants, and that's just about all the states, said Stephen Ellis, vice president of Taxpayers for Common Sense, a budget watchdog group.
Only South Carolina, Arizona and Michigan would not qualify, he said.
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