Okay, it’s just one study. But based one that covered audits of2013 TaxAuit.com Audit Defense users, Michiganders had the 5th highest number of audits of state returns. Thankfully they did NOT appear in the top ten of federal audits. California and Colorado had the highest federal audits, and New York and Massachusetts had the highest state audits.
So, of course that begs the questions, how do I avoid becoming on of those Michigan statistics? Well, first of all, make sure you can substantiate everything on your return! If you are using a computer, there should be no worries concerning math issues or not using the federal AGI to start your state return.
However, if using the property tax credit on the MI return, it is important to include all household resources. Check the instructions if you aren’t sure of this definition. Make sure you use the appropriate year taxable value and only include property taxes based on mileage (that means no lighting assessments people!)
And if you have additions and subtractions to your MI income, review instructions carefully. These have changed, some slightly, some dramatically in the last few years.
And of course, if at all in doubt, see a professional, much preferable than an audit letter, believe me!