Last year, Michigan’s Governor, Gretchen Whitmer, enacted legislation ensuring that approximately 700,000 households are set to receive an average tax refund of $550 shortly. Here’s what you need to know. While many state stimulus payments were issued before the close of 2023, the remainder are scheduled for distribution in early 2024.
As the previous year drew to a close, Michigan’s administration declared its plan to distribute average refund checks of $550 to nearly 700,000 qualifying family units. Under a bill sanctioned by Governor Whitmer, the state introduced the Enhanced Working Families Tax Credit. For the 2022 fiscal year, this tax credit is capped at $2,080.
Michigan’s enhanced working families tax credit understanding the new 30% reimbursement and its impact on tax refunds
Eligible taxpayers were entitled to up to 6% of this credit as part of their state tax refund last year. The recent expansion of this credit now permits a 30% reimbursement, meaning an additional 24% will be refunded. Consequently, the government anticipates the average refund for eligible households to be around $550.
“By increasing the Working Families Tax Credit fivefold, we’re effectively returning an average of $550 to the pockets of 700,000 Michigan families ahead of time,” Governor Whitmer remarked in a press release in December.
It’s important to note that the actual refund amount may vary among families, with some receiving less, more, or none at all. The refund amounts for the 2022 fiscal year hinge on several factors, including income, the number of eligible children, and marital status.
“This initiative positively impacts half of the children in Michigan. Parents can utilize this additional fund for various needs, such as settling taxes, paying bills, stocking up on groceries, or purchasing school supplies,” Whitmer added.
To be eligible for this refund, applicants must have claimed the Michigan Working Families Tax Credit and qualified for the federal Earned Income Tax Credit (EITC) for the 2022 fiscal year. Additionally, being free of tax debts is a prerequisite for receiving the funds.
The Michigan Department of Treasury is responsible for determining eligibility for this augmented tax credit and will issue the payments automatically. This means that taxpayers are not required to undertake any further steps or submit extra documentation to receive their checks.
The distribution of these checks is set to commence on February 13 and will continue over a span of five to six weeks.
For the 2023 fiscal year, the 30% rate for the Working Families Tax Credit will remain applicable and will be included in the state refunds issued later this year to qualified taxpayers.