You need to file MI to show that you are exempt from the tax.
The State of Michigan
allows an exemption for military pay earned out of state. In the Personal
Info section of Turbo Tax, be sure you check the box indicating you served
in the military. Then, after entering the dollar amounts of your military W-2,
one of the following pages will ask “Do Any of These Apply to This W-2?”
Check the first box to tag the W-2 as a military W-2. That should exempt your
military pay from the state tax.
