4924, Withholding Certificate for Michigan Pension or Annuity Payments MI W-4P-2025

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You are responsible for making sure the appropriate federal income tax is withheld from your annuity. Be sure to check your federal tax withholding early in the year and make adjustments if needed.
The purpose of the W-4P form, officially known as the Withholding Certificate for Periodic Pension or Annuity Payments, is to ensure that the correct amount of federal income tax is withheld from your pension payments.
What are the federal taxes on pensions? In most cases, pension payments are subject to federal income tax withholding set at a default of 10%, though you can adjust your rate or opt to make periodic payments instead.
Generally, pension and annuity payments are subject to Federal income tax withholding. The withholding rules apply to the taxable part of payments or distributions from an employer pension, annuity, profit-sharing, stock bonus, or other deferred compensation plan.
Are pensions or retirement income taxed in Michigan? Yes, but its complicated. In tax year 2023, Michigan began a four-year phase-out of its retirement income tax. By the 2026 tax year, pensions and income from 401(k) and IRA withdrawals will be fully exempt from state income tax.

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For the 2024 income tax returns, the individual income tax rate for Michigan taxpayers is 4.25 percent, and the personal exemption is $5,600 for each taxpayer and dependent. An additional personal exemption is available if you are the parent of a stillborn child delivered in 2024.
Purpose of form. Complete Form W-4P to have payers withhold the correct amount of federal income tax from your periodic pension, annuity (including commercial annuities), profit-sharing and stock bonus plan, or IRA payments. Federal income tax withholding applies to the taxable part of these payments.

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