Live in Michigan, Work Remotely for a California Employer: Who Taxes You?
Answer
Only Michigan taxes you. California levies no personal income tax on wages, so nothing is withheld there and you file no California return. Michigan taxes its residents on all income wherever earned, which means your California earnings go on a Michigan resident return in full.
Last verified
Crossing into a state with no income tax does not lower your tax bill, because your home state is not taxing you on where you work — it is taxing you on where you live. Michigan reaches all of a resident's income, and California adds nothing on top.
What you file
- 1Resident return · Michigan
File a Michigan resident return reporting all of your income.
The two states, side by side
| Michigan | California | |
|---|---|---|
| Taxes wages | Yes — flat | Yes — graduated |
| Reciprocity partners | 6 (Form MI-W4) | None |
| Convenience rule | No | No |
| Nonresident return | Form MI-1040 with Schedule NR | Form 540NR |
| Credit for other-state tax | Form MI-1040 (credit for income tax imposed by another state) | Schedule S |
| Nonresident safe harbour | None published | None published |
| Local income tax | Yes | No |
| Revenue department | Michigan Department of Treasury | California Franchise Tax Board |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in California and working in Michigan gives:Home state only.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- W-2 commuter: Michigan → CaliforniaBoth states — credit offsets the double tax
- 1099 contractor: Michigan → CaliforniaHome state, plus the client state if you work there
- Moved mid-year: Michigan → CaliforniaTwo part-year returns
Other Michigan pairs
Questions people actually ask
I live in Michigan and work remotely for a California employer. Which state do I pay?
Only Michigan taxes you. California levies no personal income tax on wages, so nothing is withheld there and you file no California return. Michigan taxes its residents on all income wherever earned, which means your California earnings go on a Michigan resident return in full.
Which state should my employer be withholding for?
Michigan. Your employer should withhold Michigan tax rather than California tax on these wages. If a California line is showing on your pay stub, raise it with payroll now rather than at filing time.
Does my California employer's location alone create a California tax obligation?
No. California sources wages to the place where the work is physically performed, and it does not apply a convenience-of-the-employer rule that would override that. Days you actually spend working inside California are a different matter — those are California-source income and can require a nonresident return.
How current is this?
The Michigan and California rules on this page were last checked against Michigan Department of Treasury and California Franchise Tax Board on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Michigan Department of Treasury — individual income taxaccessed 2026-08-07
- California Franchise Tax Board — individual income taxaccessed 2026-08-07