One of the biggest challenges Michiganders face today is costs. It’s hard to buy a house, afford a car, or save for retirement while keeping up with bills.

That’s why we are continuing our work to lower costs and help Michigan families keep more of their hard-earned money. Whether you’re in college, have kids in school, or are ready to retire, we’re doing what we can to help make your life more affordable.

• We rolled back the retirement tax to put an average of $1,000 a year back in the pockets of 500,000 senior households.

• We quintupled the Working Families Tax Credit from 6% to 30%, delivering an average combined tax refund of $3,150 to 700,000 families, directly impacting nearly one million kids – almost half the kids in Michigan.

• We are feeding all 1.4 million of Michigan’s public school students free breakfast and lunch, saving families more than $850 a year per kid on groceries.

• We expanded access to free pre-K for Michigan four-year-olds, prioritizing those who need it most. This will save families $10,000 a year and give every kid a solid academic foundation.

• We are lowering the cost of higher education for everyone with:
  • Community College Guarantee, delivering two years of in-district community college tuition-free for Michigan high school graduates, helping nearly 20,000 young people save up to $4,800.
  • Michigan Achievement Scholarship, lowers the cost of college by thousands of dollars a year—up to $27,500 over 5 years—for a majority of graduating high school seniors.
  • Michigan Reconnect, providing tuition-free pathways for adult learners 21 and older.

• We are working to lower the cost of buying or renting a home by building more housing to expand supply. This year, MSDHA is making the largest investment to build, rehab, or permit housing in Michigan history—a $1.4 billion investment for 10,000 homes, without raising taxes by a dime. They will keep this progress going next year too.

• In tandem with the Biden-Harris administration, we’ve made strides to lower the cost of prescription drugs and ensure access to quality, affordable health care.Medicare now negotiates the prices of ten expensive, commonly used prescription drugs directly and insulin costs $35 a month for everyone. In Michigan, we’ve taken action to protect patients from surprise medical billing, extended Healthy Michigan to over 1 million people, lowered health care costs for working families, and codified the Affordable Care Act into state law, protecting care for millions.

• The historic clean energy package I signed into law last year, combined with the Biden-Harris Administration’s Inflation Reduction Act (IRA), will drive lower energy costs in our state. Highlighted in a new report, 5 Lakes Energy projects that, by 2030, our investments will drive household energy bills down $297 a year and save $7.3 billion in public health costs.

We are getting all this done without raising taxes on Michiganders by a dime. In fact, the new balanced, bipartisan budget I signed earlier this year builds on the $1 billion in tax relief we delivered last year, continuing to drive down costs.

We will keep rolling up our sleeves, lowering costs, and doing what we can to make life more affordable for you and your family. 

See the details of some of our biggest accomplishments below.

Sincerely,

Gretchen Whitmer

Governor

Rolling Back the Retirement Tax

Last March, I signed the Lowering MI Costs Plan, rolling back the retirement tax over four years, putting $1,000 a year, on average, back in the pockets of 500,000 households. That’s money in our retirees’ pockets for prescriptions, rent, utilities, car payments, or gifts for grandkids.

After working for a lifetime, Michiganders deserve to be able to retire and keep every hard-earned dollar of their retirement funds. In 2012, Michigan’s tax code was rewritten to slap a retirement tax on hundreds of thousands of Michiganders. Seniors had money that was promised to them taken out of their hands.

Michigan will start phasing out the retirement tax over four years, saving half a million households with pensions an average of $1,000 a year. By the 2026 tax year, this new law will essentially restore the pre-2012 retirement and pension benefits subtraction for most taxpayers in Michigan. The repeal is 100% phased in for all first responders this year.

Retirement and pension benefits include most income that is reported on Form 1099-R for federal tax purposes. This includes defined benefit pensions, IRA distributions, and most payments from defined contribution plans. This law change will ultimately benefit most retirees in Michigan while ensuring that taxpayers in unique circumstances are not harmed.

Lowering Housing Costs

We all need a safe, affordable place to call home, but we are facing a housing crisis driven by a lack of supply. Our response to the statewide housing shortage is simple: build, baby, build!

By building up supply, we can drive down costs and make our neighborhoods better places to live, work, and invest.

This year, MSDHA is making the largest investment to build, rehab, or permit housing in Michigan history—a $1.4 billion investment for 10,000 homes, without raising taxes by a dime. And the new balanced, bipartisan state budget I signed will invest another $100 million to build or rehab affordable housing.

We will continue helping lower costs for Michigan families to buy a home or stay in their existing residence.  

• We are helping thousands of families buy homes through Down Payment Assistance and MI Home Loan Mortgage Programs. 
• We are helping tens of thousands of families stay in their homes and prevent foreclosure with funding from the Michigan Homeowners Assistance Fund. 

Working Families Tax Credit

The Working Families Tax Credit, also known as the EITC, delivers an average combined refund of $3,150 to 700,000 Michigan families.

Last year, with our new legislative majority, we quintupled the Michigan Working Families Tax Credit match of the federal Earned Income Tax Credit to 30%, up from 6%, which put hundreds more dollars in people’s pockets starting this year.

The Working Families Tax Credit directly benefits half the kids in Michigan, and moms and dads use the extra money at tax time to pay the bills, put food on the table, and buy school supplies. From small towns to downtowns, the Working Families Tax Credit empowers families across Michigan.

Michigander will continue to benefit from this expansion in the years ahead. I encourage every eligible Michigander to take advantage of the credit when you file your taxes next year.

To qualify, individuals must meet certain requirements and file a federal income tax return, even if no tax is owed or there is no requirement to file a return. If a federal credit is granted, the state of Michigan will provide up to an additional 30% credit when the taxpayer files their state income tax return.