2024 Michigan State Income and Sales Tax Return

Types of Individual Income That Qualify for State Tax Exemption
As mentioned in Step 1 of previous page

Per the Michigan Tax Agreement, section § IV (A)(1), 3rd amendment, the following outlines the income that RTMs can be exempt from paying Michigan State income tax.

  1. Non Business Income

Resident Tribal Members are exempt from State income tax on all Non Business income including but not limited to:

a. All income derived from wages are exempt whether the wages are earned within the Agreement Area or outside of the Agreement Area;

b. All interest and passive dividends are exempt;

c. All rents and royalties derived from real property located within the Agreement Area are exempt;

d. All rents and royalties derived from tangible personal property, to the extent the personal property is utilized within the Agreement Area, are exempt;

e. Capital gains from the sale or exchange of real property located within the Agreement Area are exempt;

f. Capital gains from the sale or exchange of tangible personal property which is located within the Agreement Area at the time of sale are exempt;

g. Capital gains from the sale or exchange of intangible personal property are exempt;

h. All pension income and benefits including, but not limited to, 401(k), IRA, defined contribution plan, and defined benefit plan payments are exempt;

i. All per capita payments by the Tribe to Resident Tribal Members are exempt without regard to the source of payment; and

j. All gaming winnings are exempt.