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Are military exit benefits and military separation pay exempt from Michigan individual income tax?
Are military exit benefits and military separation pay exempt from Michigan individual income tax?
Exit benefits and separation pay that are classified as military compensation may be deducted to the extent they are included in adjusted gross income. Compensation paid from federal appropriations, including retirement benefits, for military services in the armed forces of the United States is exempt from Michigan individual income tax.
NOTE: Military retirement benefits must be reported on the Schedule W even if no Michigan tax was withheld.