HB 4159 Summary

• Amends Michigan income tax law to revise limitations and restrictions on retirement and pension benefit deductions based on taxpayer age and birth year, effective for tax years beginning after December 31, 2016.

• Increases deduction limits for persons born 1946-1952: raises limit from $20,000 (single) and $40,000 (joint) to $30,000 (single) and $60,000 (joint) for those under age 67, with higher limits available at age 67 and beyond.

• Modifies deduction limits for persons born after 1952: establishes $10,000 (single) and $20,000 (joint) limit before age 67, then allows $30,000 (single) and $60,000 (joint) at age 67 and older.

• Establishes special higher deduction limits for persons receiving government pensions not covered by Social Security, with amounts ranging from $15,000 to $80,000 depending on birth year and filing status.

• Adds annual inflation adjustment for deduction limits beginning in 2018, based on the United States consumer price index.