Indiana and Michigan state taxes

[u00smh1]

My son lives in Indiana and worked a summer job in Michigan.  It appears I have to file both Indiana and Michigan state taxes.  After working through both state forms, it appears he is being charged the full state taxes on him income for both Indiana and Michigan.  I would like to make sure the program is accurately splitting the taxes due for each state.  Also I thought Indiana and Michigan had an agreement that a person would not have to file both state income tax formes.

[BillM223]

First, you don't have to file both state returns - your son does.

Second, yes, Michigan and Indiana are reciprocal states - however, what this means is that your son could have asked his Michigan employer to withhold Indiana taxes so that he would file only the Indiana return.

Since that apparently did not happen, your son will need to file a nonresident return in Indiana and a resident return for Michigan.

Please have him to do Michigan return first, then Indiana.

[Hal_Al]

Mi has a reciprocal agreement, on wages,  with IN. No MI state taxes are withheld or due and you do not normally need to file a MI return. But IN will tax you on your other state income.

If MI taxes are mistakenly withheld, you then have to file a MI return to get a full refund*. IN will not give you a credit. 

Michigan is particularly messy to get a refund from. For details, see:

https://ttlc.intuit.com/community/state-taxes/discussion/re-state-tax/01/1501675#M67119

*However the reciprocity agreement does not apply to local city taxes. You are not required to file a MI city return, but you are also not entitled to a refund of the city withholding (box19 on your W-2), unless there was an error in the amount. Some (but not all) IN counties (but not the state)  allow a credit, or partial credit for tax paid to a MI city. If yours is one, that will come up in the IN state interview.