Michigan Tax

For Michigan residents, you specify the employee's exemptions.

Deltek Modification Date - 01/24/14

Enter the following field information for residents of Michigan on the Withholding grid on the Payroll tab of the Employee Info Center:

Field	Description
Status	Michigan’s tax calculations do not use the Status field.
Exemptions	Enter the total number of withholding exemptions claimed by the employee on the Employee’s Michigan Withholding Exemption Certificate, Form MI-W4. This figure includes personal exemptions for self and spouse not claimed on other Form MI-W4. The personal exemption amount is $4,000.
Other Exemptions	This figure includes exemptions for dependents claimed by the employee on Form MI-W4. If the employee did not submit Form MI-W4, enter zero for the number of exemptions. Michigan no longer uses the special exemptions allowance for tax calculation purposes. (This value was previously determined by multiplying the number of exemptions claimed in the Other Exemptions field by $1,900).You can still enter a value in the Other Exemptions field on the Withholdings grid of the Payroll tab in the Employee Info Center. However, Vision will not use this value to calculate Michigan tax.

Automatically Calculated Variables

Vision automatically computes the following variables.

Special Exemptions

Michigan no longer uses the special exemptions allowance for tax calculation purposes. (This value was previously determined by multiplying the number of exemptions claimed in the Other Exemptions field by $1,900).

You can still enter a value in the Other Exemptions field on the Withholdings grid of the Payroll tab in the Employee Info Center. However, Vision will not use this value to calculate Michigan tax.

Allowance

The Allowance is determined by multiplying the number of exemptions claimed in the first Exemptions field by $4,000.

How Vision Calculates Tax

To calculate an employee's Michigan State tax, Vision does the following:

1. Multiplies the employee's gross pay per pay period by the number of pay periods in a year to determine annualized gross wages.
2. Subtracts the allowance and any 401(k) and 125/Cafeteria plan contributions from the employee's annualized gross wages to determine taxable income.
3. Calculates the net income tax by applying Tax Calculation Method 2 to the taxable income, using a percentage of 4.25%.
4. Divides the net income tax by the number of pay periods in a year to determine the amount to be withheld for the pay period.