Michiganders who collected state unemployment benefits last year will not be required to pay penalty and interest related to underpaid estimated tax payments, according to the Michigan Department of Treasury. Effective immediately, the state Treasury Department has granted an automatic waiver of all penalties and interest related to underpaid estimated tax payments owed by taxpayers who received unemployment benefits in 2020. Under state law, taxpayers are required to pay quarterly estimated tax payments when the annual tax due is expected to exceed $500 or more.
All taxpayers who received unemployment during the 2020 tax year will automatically receive this waiver. Because this waiver is automatic, taxpayers do not need to contact the state Treasury Department. To learn more about the State of Michigan’s individual income tax, go to www.michigan.gov/incometax.