The Hudson guide
Hudson city income tax, explained
Hudson, the small Lenawee County city near the Ohio border, charges 1% to residents and 0.5% to non-residents who work there. This calculator applies the exact rate.
Hudson’s rate: 1% resident, 0.5% non-resident
Hudson levies 1% on residents and 0.5% on non-residents who earn wages in the city. It’s the standard Michigan 1% structure, applied to wages, salaries and self-employment income, with Social Security excluded. The tax funds the city’s general operations.
The small-town economy
Hudson’s employment base is local — manufacturing and machining, healthcare, education, and the retail and service businesses that serve the southern Lenawee County area. Residents pay the full 1%; commuters from Hudson Township, Addison, or the surrounding countryside pay 0.5% on their Hudson wages.
What $40,000 looks like in Hudson
At $40,000, single, one exemption, a Hudson resident pays about $400 a year at 1%, on top of roughly $1,700 to the state. A non-resident commuter pays about $200. In biweekly terms that’s about $15 (resident) or $8 (commuter) per check.
Withholding and filing
Employers with Hudson workers withhold the tax as a stub line. Wage earners rarely file. Self-employed residents pay quarterly, and annual returns follow the state spring calendar. The city’s treasury office administers the tax.
The regional comparison
Hudson is one of the few taxing cities in Lenawee County — Adrian, the county seat, has no city income tax. A worker comparing a Hudson job against an Adrian job sees the city line disappear entirely on the Adrian side. The calculator’s city selector makes both exact.
Hourly work and overtime in Hudson
Hudson’s manufacturing and machining sector employs a real hourly workforce, and the city tax applies to every shift and overtime dollar at the flat 1% (or 0.5% non-resident). A machinist at $26/hour with ten weekly overtime hours sees roughly $6.80 a week go to the city on the OT alone. The hourly and overtime modes apply the rate automatically, so the per-hour take-home figure on screen is the true one.
Self-employment in Hudson
Self-employed Hudson residents owe the 1% on net profit, paid quarterly with state and federal estimates. A small-shop owner clearing $40,000 net owes about $400 a year to the city. Independent contractors based outside the city who work inside it owe the 0.5% non-resident rate on in-city earnings. The self-employment mode includes the city rate in the annual total.
A real check, broken down
Here is what one biweekly check looks like for a Hudson resident at $42,000, single, no pre-tax deductions: gross $1,615, federal about $128, FICA about $124, Michigan about $57, Hudson about $16. That nets roughly $1,290 per check, or about $33,540 a year. A commuter from Hudson Township pays about $8 per check instead — half the line, as the residency toggle shows.
Retirees in Hudson
For retirees living in Hudson, Social Security is excluded from the city income tax. Pension income follows the retirement phase-in by birth year: workers born after 1945 see up to $67,610 of retirement income excluded in 2026. A retired Hudson resident with only Social Security and a modest pension often owes very little to the city. The calculator applies the same exclusion logic.
The border-adjacent economy
Hudson sits just north of the Ohio line, and a handful of residents commute south for work. Ohio has no city wage taxes of this kind for most workers, so the Hudson line applies to Michigan-sourced income — and for a Hudson resident who works in Ohio, the city tax still follows the residency, not the work location, because Hudson is a resident-taxing city. The calculator models the U.S.-side picture; cross-border workers should confirm the sourcing treatment with their employer.
What to watch in the next tax year
Hudson’s 1%/0.5% structure is long-settled and no rate change is on the books for 2026. What does move each year is the federal standard deduction and brackets, Michigan’s exemption amount, and the Social Security wage base — all read from the current MI-2026 data file. Re-run the page after the new year to pick up the refreshed figures.
Who should use this calculator, and how
This tool is for anyone who lives or works in Hudson: residents who want the true net on their pay, commuters from Hudson Township or the surrounding countryside, self-employed residents building quarterly estimates, and job candidates comparing a Hudson job against one in Adrian or the townships. Enter your gross, frequency, filing status, exemptions and pre-tax amounts; the calculator returns the exact net per period with the Hudson line shown separately from state and federal. Toggle residency to see the half-rate commuter case, or switch to Adrian to price the county seat’s no-tax comparison.
How Hudson fits the state picture
Hudson is one of 24 Michigan cities with a wage tax, and its 1%/0.5% split is the most common structure in the state — the same shape used by Lansing, Jackson, Albion and a dozen others. What makes it distinctive is that it is one of the very few taxing cities in the southern tier, and the only one in the immediate area: Adrian, the Lenawee County seat, has no city tax at all. For a small community whose economy runs on local manufacturing and service work, the city line is a modest but constant part of every paycheck.
How to check your withholding is right
After your first paycheck, check the stub for a line labeled for Hudson. If the line is missing and you live or work in the city, ask payroll to set up city withholding. If it’s there, compare against this calculator’s city line: it should match your gross, reduced by pre-tax deductions, times 1% (resident) or 0.5% (commuter). A small variance is normal around the exemption; a systematic difference is worth a call to the city’s treasury office.
Three Hudson scenarios
A $42,000 resident nets about $33,540 a year with the 1% line; a $40,000 non-resident commuting from Hudson Township pays 0.5% on Hudson wages, about $200 a year; and a $42,000 resident with a 5% 401(k) plus health premiums sees the city line shrink with the pre-tax base. Run all three through the calculator and each comes back with a different per-check number.
The full withholding stack in Hudson
A Hudson resident’s check comes out in four visible layers: federal progressive tax after the standard deduction; FICA at 6.2% and 1.45%; Michigan’s flat 4.25% on the state taxable base after the $5,900 exemption; and Hudson’s 1% on the city base. Pre-tax 401(k) and health contributions reduce the federal, state and city lines together, while FICA is computed on wages net of health only. The calculator reproduces that ordering exactly, so the per-check figure matches a real stub within a few dollars.
How the calculator handles Hudson exactly
Set city to Hudson and residency to resident (or non-resident). Enter your gross, frequency, filing status, exemptions and pre-tax amounts. The tool applies Hudson’s 1% (or 0.5%), Michigan’s 4.25%, FICA and federal brackets, and returns the exact net per period. Toggle to Adrian to see the same salary with no city line at the county seat.
What the tax funds and its stability
Hudson’s 1%/0.5% structure is a long-standing general-fund revenue source for the small city. No rate change is on the books for 2026. As one of the only taxing cities in the southern tier, the line is a real part of every local paycheck, and it’s worth confirming it appears on your stub from the first check.
The comparison worth running
The single most useful run on this page is Hudson against Adrian. Enter the same salary twice, change only the city, and read the difference on the city line: roughly $420 a year on a $42,000 income. For a worker choosing between the county seat and the taxing city, that gap is real money every check.
Planning your withholding correctly
On your first Hudson paycheck, confirm the stub’s city line says Hudson and not one of the neighboring non-taxing townships — small-company payroll in rural areas sometimes lags on city-tax setup. If the line is missing, ask payroll to add it. A correct setup from day one avoids a year-end surprise and keeps your quarterly picture accurate when you run the calculator.
Hudson’s tax is easy to miss if you’re new to town — but it’s withheld on every paycheck for workers in the city. Check the city line on your first stub.