Make sure to select the Type of Retirement you received on your MI state return:
- Open your state return
- Continue until you get to the screen Retirement and Pension Benefits
- Select the type of retirement.
The following pensions are automatically deducted from your Michigan taxable income:
- Railroad retirement benefits
- U.S. Armed Forces or Michigan National Guard
Pensions from these government agencies are eligible for a pension deduction:
- State of Michigan
- Michigan and local governments
- Federal civil service
Pensions from private sources are eligible for a pension deduction if they fall into one of these categories:
- Benefits from a pension plan that defines eligibility for retirement and sets contributions and benefit amounts in advance.
- Retirement benefits from qualified self-employment plans.
- Distributions from a 401(k) or 403(b) plan attributable to your employer's contributions or attributable to your contributions to the extent your contributions result in matching contributions by your employer.
- IRA distributions you receive after you turn 59-1/2 or because you've elected to receive your benefits as part of a series of substantially equal payments before you turned 59-1/2.
- Benefits from a retirement annuity policy, if you've elected to receive income for life, if you're age 65 or older. Benefits from an annuity when you've elected to receive the income for a specific number of years do not qualify under this definition.
- Benefits from any of the above plans if you're the surviving spouse of a person who would have qualified.
For more information check: michigan.gov
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