Additional $550 tax credit available in Michigan next year
Early next year, more than 700,000 households will receive an additional $550 tax credit from Michigan. The additional tax credit is part of a new plan announced by Gov. Gretchen Whitmer to put money back in the pockets of qualifying families.
Michigan Additional Tax Credit: What is it?
On Wednesday, Governor Whitmer announced a new plan called the “Working Families Tax Credit” to help families pay their bills, put food on the table and buy school supplies. Michigan’s additional tax credit is scheduled to end in February 2024., the governor said
“This directly benefits half of Michigan’s children, and moms and dads can use this extra money on their tax returns to pay bills, put food on the table and buy school supplies,” Whitmer said in a statement Thursday. revealed.
The governor also informed that checks will begin issuing on February 13, 2024. It is estimated that it could take up to six weeks for Michigan to issue any additional tax credits. Checks will be mailed sequentially.
Michigan’s Working Family Tax Credit is similar to the federal government’s Earned Income Tax Credit. This tax credit provides a tax benefit to families with workers who earn below a certain level.
According to the IRS, the amount of the credit depends on your household’s salary and number of children. For example, a family of four earning up to $59,478 could receive up to $6,604.
How much money should you expect?
Whitmer’s additional tax credit in Michigan is the result of new legislation signed by the governor in March. The new law increases the state Earned Income Tax Credit (EITC) from 6% to 30% of the federal credit.
But the new law did not receive enough Republican support to take effect before the 2022 tax filing deadline. However, the law provides an additional deduction only for the 2022 tax year to make up the difference between the 6% tax credit they received and the 30% tax credit.
Therefore, eligible individuals who will claim the credit in 2023 will also receive a check representing the difference between the original rate (6%) and the new rate (30%).
Taxpayers do not need to file an amended 2022 income tax return to receive the additional tax credit. The Michigan Department of Finance will automatically process refund payments to those who file a 2022 tax return and verify their eligibility for the credit.
Separately, eligible families who meet the requirements must apply for the tax credit this year. Some families may be eligible to receive both the additional deduction and the full 30% tax credit based on their 2023 returns.
In total, more than 700,000 households will receive a comprehensive tax refund averaging $3,150. This will directly benefit nearly one million children, or about half of Michigan’s children.
For more information about additional tax deductions in Michigan, visit this link.
