Individual income tax: deductions; deduction for all compensation earned by a taxpayer 17 years of age or younger; provide for. Amends sec. 30 of 1967 PA 281 (MCL 206.30).
Summary
House Bill 4592 would amend Michigan’s Income Tax Act to add a new subtraction from taxable income for compensation earned by a taxpayer who is 17 years of age or younger, or by a dependent of a taxpayer who is 17 years of age or younger, beginning with tax years starting on or after January 1, 2026. In practical terms, the bill would exempt youth wages from Michigan individual income tax, reducing taxable income for affected families and young workers.
The bill leaves the rest of section 30 largely intact and does not alter the many existing deductions, exemptions, and phase-in rules already in the statute. It would operate as another specific income subtraction within Michigan’s tax code, alongside existing deductions for retirement income, Social Security, education savings accounts, ABLE accounts, first-time home buyer savings accounts, wrongful imprisonment compensation, and other targeted categories.
Impact
The bill would amend MCL 206.30 of the Income Tax Act of 1967 by creating a new deduction for compensation earned by minors age 17 or younger. This would lower Michigan taxable income for eligible taxpayers and could reduce state income tax collections from wages earned by youth workers and from income reported by parents for dependent children. No other statutes are directly changed, but the amendment would interact with existing income tax filing and withholding rules administered by the Department of Treasury.
Sentiment
Based on the bill text and the absence of recorded committee testimony or votes in the provided materials, the available context suggests a straightforward, policy-specific proposal with no documented public controversy in the record supplied. The measure appears aimed at tax relief for young workers and families, and the caption frames it as a targeted individual income tax deduction. Because no committee discussion or vote history is included, there is no evidence here of formal support or opposition beyond the bill’s introduction.
Contention
The main policy issue is whether Michigan should exempt all compensation earned by minors from income tax, which would benefit youth workers and the households that claim them as dependents. Potential points of contention would likely involve the revenue impact on the state, whether the deduction should apply broadly to all compensation or be limited in some way, and whether the age cutoff at 17 is the appropriate threshold. No specific objections or supporters are identified in the provided record.