The severance pay would not be listed separately on your W-2 form, as it is taxable the same as ordinary wage income. It should be included in the line 1 entry on your W-2 form. So, you should enter your W-2 form as it is stated. If you see the Michigan abbreviation (MI) in box 15 on your W-2 form and the severance pay included in box 16 on the W-2 form, then you don't need to do anything additional.
When your prepare your Michigan tax return, you need to indicate that you are a part-year resident of the state. If the severance pay does not appear on your Michigan return, you need to go through the state program again and in the income section you should see an option to adjust your wages to include the severance pay.
You can view a summary of your Michigan return to see if the severance pay is listed on it by following these instructions while in the state portion of TurboTax online program:
- Click on Tax Tools in the left menu bar
- Click on Tools
- Look under Other Helpful links….
- Choose View Tax Summary
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