The University Record, November 26, 1996

Michigan begins move to 'paperless' income tax filing

Some Michiganders will now be able to choose legally not to file income tax return forms with the state.

Under a new program called No-Form, eligible taxpayers can choose not to complete a tax return for 1997. (Returns for 1996 must still be filed by April 15, 1997 whether or not you meet the following conditions.) Participants must be Michigan residents, earn income upon which the proper amount of Michigan tax has been withheld, have other income (such as interest income) subject to Michigan tax of less than $100 for a single return or $200 for a joint return, and they must file a new MI-W4 form choosing the No-Form option.

Choosing the No-Form option means you cannot claim these credits on your return:

 

homestead property tax

 

city income tax

 

medical care savings account

 

public contributions

 

community foundations

 

homeless/food bank contributions

 

college tuition

You may, however, file appropriate credit forms and receive a credit for home heating or prescription drugs with the No-Form option.

University employees who have questions about the new option or who believe they are eligible and would like to participate in the no-form program should contact the Payroll Office, 764-8250, and complete a new MI-W4 form stating their intent to participate.

Q & A: The No-Form option

Is there a deadline for participating in the No-Form Michigan income tax option?

If you are currently employed, you should choose the No-Form option before the end of the first pay period in 1997. You may choose the No-Form option at any time during the year if the correct amount of tax has been withheld.

 

How do I know if the correct amount has been withheld?

To determine if the correct amount of tax is being withheld, subtract your exemption allowance from your gross wage figure, then multiply the result by 4.4 percent (x .044, the income tax rate). The following example, using a single person with an annual salary of $20,000 who is entitled to one exemption and who is paid bi-weekly, may help:

Example:

Wages are $20,000.

Exemption allowance: 1 x 2,500=2,500

$20,000-$2,500 = $17,500 tax liability

4.4 % (tax rate) x $17,500=$770

Divide by the number of pay periods in the year:

$770 divided by 26=$29.61

Your Michigan tax withheld biweekly should be close to $29.61 each pay period.