Transparency
Overview
Every calculation on this site runs through a single engine (src/lib/engine.js) that reads all
rates and thresholds from a single data file (src/data/mi-2026.json). No rate is hard-coded into
any page or component. That means the numbers are internally consistent across all 40+ pages, and updating a
rate in one place updates the entire site.
The input model
The calculator accepts gross income — as an annual salary, a per-period salary, or an hourly rate times hours with overtime — plus pay frequency, filing status, number of exemptions, pre-tax retirement contributions, pre-tax health insurance, and the city where you work and live. From gross it derives the taxable bases for each tax layer.
The four tax layers and their bases
The engine computes four layers in a fixed order, each on its correct base:
- Federal income tax — computed on taxable income = gross − retirement − health − standard deduction, using the progressive 2026 brackets. The standard deduction is $16,100 single, $32,200 married filing jointly, and $24,150 head of household.
- FICA — Social Security at 6.2% up to the $184,500 wage base, plus Medicare at 1.45% with no cap, computed on wages net of pre-tax health (but not net of retirement contributions). An extra 0.9% Medicare surtax applies to wages above $200,000 for single filers.
- Michigan state tax — a flat 4.25% on Michigan taxable income = gross − retirement − health − ($5,900 × exemptions). Retirement income is further reduced by the retirement exclusion ($67,610 single / $135,220 married) for filers born after 1945.
- City income tax — a flat city rate (resident or non-resident) on gross − retirement − health. The resident rate is used when the home city taxes; the non-resident rate is used when the work city taxes and the home city does not. Social Security income is excluded from both state and city taxable bases.
Pre-tax retirement contributions reduce federal, state and city tax but not FICA. Pre-tax health insurance reduces all four layers. This matches the real withholding rules and is the reason the calculator\u2019s per-check figures line up with actual stubs within a few dollars.
Bonus income
Bonus and supplemental pay uses the flat 22% federal supplemental withholding rate on the bonus amount, plus the standard FICA, state and city rates on the same bonus. This matches the IRS flat supplemental method that most employers use.
Self-employment income
Self-employment income uses the SE tax rate of 15.3% applied to 92.35% of net profit (the Social Security and Medicare share both halves), with half of the SE tax deducted as an adjustment to income. Federal income tax is computed on profit minus the SE tax deduction and the standard deduction; state and city tax use the same pre-tax adjustments as wage income.
Overtime
Hourly overtime is computed at 1.5× the regular rate for hours over 40 in a workweek, per the federal Fair Labor Standards Act, and is taxed through the same four layers as regular wages. Michigan does not require a separate daily overtime rule, so the 40-hour weekly threshold is used.
2026 figures in the data file
The following figures are used for the 2026 tax year and live in src/data/mi-2026.json: federal
standard deduction and brackets; the $184,500 Social Security wage base and $200,000 Medicare surtax threshold;
Michigan\u2019s flat 4.25% and $5,900 per-filer exemption; the $67,610 / $135,220 retirement exclusion; and the 24
city rates with their resident/non-resident splits.
Known simplifications
The calculator is an estimate, not a tax filing. It does not model itemized deductions, tax credits, dependents beyond the exemptions, capital gains, or state adjustments beyond the retirement exclusion. Withholding tables round per period, so a real stub may differ from the annual model by a few dollars. It is not affiliated with the State of Michigan or the IRS.
Primary sources
Every figure is tied to a primary source:
- Michigan flat rate (4.25%), personal exemption ($5,900) and retirement phase-in: Michigan Department of Treasury, 2026 Withholding Guide (Form 446) and the 2026 rate determination, michigan.gov/treasury.
- Federal brackets, standard deduction and 22% supplemental rate: IRS Rev. Proc. 2025-32 and IRS Publication 15 (Circular E).
- Social Security wage base ($184,500) and Medicare surtax: Social Security Administration, 2026 wage base announcement.
- City income tax rates: each city\u2019s income-tax ordinance and rate schedule, verified at the city\u2019s official site.
All figures were verified on 2026-08-05 and are re-checked when the site\u2019s data file is updated.