Michigan Business Tax Information
Category
Tax Rate
Detailed Information
Category
Personal Income Tax
Tax Rate
4.25%
Detailed Information
Michigan’s personal income tax system consists of a flat rate of 4.25% of an individual's or household's income
Category
Corporate Income Tax
Tax Rate
6%/4.25%
Detailed Information
Michigan’s corporate income tax system consists of a flat rate of 6% of taxable income of firms structured as C corporations. Income for other business entities flows through to the owners’ personal income taxes and is taxed at a flat income tax rate of 4.25%.
Category
Sales and Use Taxes
Tax Rate
6%
Detailed Information
Michigan levies a 6% general sales and use tax on purchases by consumers on tangible goods. Businesses pay the same 6% sales/use tax rate when purchasing consumer goods.
Category
Personal Property Tax
Tax Rate
Phased Out
Detailed Information
Michigan began phasing out its Personal Property Tax (PPT) for most businesses in 2014. Timing of the phase out depended on the value of the personal property and when it was purchased. All first-owner purchases after 2012 became 100% exempt beginning 2016.
Category
State Essential Services Assessment
Tax Rate
0.24%-0.09% (declining over time)
Detailed Information
Beginning January 1, 2016, a new state tax known as the state essential services assessment (SESA) was levied, replacing the current personal property tax. Funds collected are used to support the costs of local police, fire, ambulance, and jail services. The SESA will be imposed on the personal property that is now exempt from the personal property tax. The SESA will be computed on the acquisition cost of taxable property at a declining millage rate scale over time.
Category
Real Property Taxes
Tax Rate
$52.65 per $1,000 (average) 5.27% (average)
Detailed Information
Michigan's 2017 average non-homestead property tax rate was 52.65 mills, or $52.65 per $1,000 of assessed property, with real and personal property subject to taxation at 50% of current market value. Michigan began phasing out its Personal Property Taxes for most businesses beginning in 2014. Businesses claiming the personal property tax exemption will instead be subject to a statewide special assessment, ranging from 0.9 to 2.4 mills, to fund essential services levied by local governments.
Category
Tax Rate
Detailed Information
*For more business and property information visit the Michigan Taxes website here.