If you collected unemployment benefits over the past year and have been holding off on filing your individual state income tax returns in anticipation of owing tax on those benefits, the Michigan Treasury has some good news and is encouraging you not to wait to file.
The Michigan Treasury Department reports that Michigan taxpayers who collected unemployment benefits and have not yet filed a state income tax return can file their returns as soon as they are able.
They say that’s because the federal American Rescue Plan Act excludes unemployment benefits up to $10,200 from income for tax year 2020 for those within certain income brackets, providing tax relief on both federal and state income taxes. As a result, taxpayers who may have anticipated owing taxes may now actually be entitled to a refund instead.
State Treasurer Rachael Eubanks says, “Please don’t hesitate to file your individual income tax return,” and adds, “Taxpayers who think they owe taxes often wait to file right up to the filing deadline.” However, she notes, “The American Rescue Plan changes the dynamic of the 2020 tax year and this year’s filing season. A larger than anticipated refund could provide much-needed assistance during the pandemic.”
Eubanks suggests, however, at this time, those taxpayers who collected unemployment benefits and have already filed their tax year 2020 federal and state income tax returns should not file an amended state or federal return. The Michigan Department of Treasury is waiting for federal guidance to help taxpayers receive any state refund they may be owed in the easiest way possible.
Additional guidance will be coming from the Michigan Department of Treasury soon.
The Treasury Department also reminds taxpayers that choosing electronic filing and direct deposit is convenient, safe and secure. Last year, more than 4.4 million Michigan taxpayers e-filed, which is 86-percent of state income tax filers.
For more information about e-filing, you can go to: http://www.mifastfile.org
Printed tax forms were distributed and are available in limited quantities at public libraries, some northern Michigan post offices, Michigan Department of Health and Human Services county offices and Treasury Field Offices.
All individual income tax returns must be received by 11:59 pm on May 17, 2021.
For the benefit and convenience of taxpayers, both the beginning and end of the individual income tax filing season are the same as for the Internal Revenue Service.
Taxpayers with questions about their state income taxes are encouraged to use Treasury eServices. The online platform enables taxpayers to ask state income tax-related questions when convenient and avoids waiting for a state Treasury Department customer service representative to answer your call.
To get started with Treasury eServices, go to http://www.Michigan.gov/IncomeTax and click on “eServices Individual Income Tax.”
