More than 700,000 families will receive a $550 additional tax credit from Michigan early next year. The additional tax credit is part of a new initiative that Governor Gretchen Whitmer announced to put money back in the pockets of eligible families.
Additional tax credit from Michigan: what is it?
On Wednesday, Governor Whitmer announced a new initiative called the “Working Families Tax Credit” to help families pay the bills, put food on the table, and buy school supplies. The additional tax credit from Michigan is set to go out in February of 2024, the governor said.
“This directly benefits half the children in Michigan, and moms and dads can use this extra money at tax time to pay the bills, put food on the table and buy school supplies,” Whitmer said in a statement on Thursday.
Further, the governor informed that the checks will start going out on Feb. 13, 2024. It is estimated that it could take up to six weeks for Michigan to issue all the additional tax credits. The checks will be mailed on a rolling basis.
Michigan’s Working Families Tax Credit is similar to the federal government’s Earned Income Tax Credit. This tax credit offers tax benefits to families if they have working individuals with income below a certain level.
According to the IRS, the credit amount depends on the household’s salary and the number of children they have. For instance, a family of four with income up to $59,478 can receive up to $6,604.
How much money to expect
Whitmer’s additional tax credit from Michigan is the result of a new law that the governor signed last March. The new law boosts the state’s Earned Income Tax Credit (EITC) from 6% of the federal credit to 30%.
The new law, however, failed to receive enough GOP support to take effect before the 2022 tax filing deadline. Still, this law offers an additional credit only for the 2022 tax year to make up for the difference between the 6% tax credit they received and the 30% tax credit.
So, 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 don’t have to file an amended 2022 income tax return to receive the additional tax credit. Michigan’s Department of Treasury will automatically process rebate payments for those who submitted their 2022 tax return and confirmed their eligibility for the credit.
Separately, eligible families meeting the requirements must apply for tax credits this year. Some families could receive both – the additional credit and the full 30% tax credit based on the 2023 filing.
In total, more than 700,000 families will get an average combined tax refund of $3,150. It will directly benefit almost one million kids, or about half the kids in Michigan.
Visit this link to get more details on the additional tax credit from Michigan.
