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Live in Michigan, Work in Maine: Which State Taxes Your Paycheck?

Both states — credit offsets the double taxMaine withholds

Answer

Both states tax the same wages, and a credit undoes the overlap. Maine withholds as your work state and you file a Maine nonresident return; Michigan taxes residents on all income, so you also file at home and claim the credit for tax paid to Maine. File Maine first.

Last verified

Without an agreement between Michigan and Maine, the overlap is handled after the fact rather than prevented. That is why the filing order matters: the Maine figure is an input to the Michigan return, so completing Michigan first means doing it twice.

A Michigan resident taxed by another state on the same income claims the credit for taxes paid to other states on Form MI-1040 (credit for income tax imposed by another state). The credit is capped at the Michigan tax on that income, so it removes the double tax but never refunds the excess when the other state charges more.

What you file

  1. 1Nonresident return · MaineForm 1040ME with Schedule NR

    File the Maine nonresident return FIRST — you need the Maine tax figure before you can complete Michigan.

  2. 2Resident return · MichiganForm MI-1040 (credit for income tax imposed by another state)

    File a Michigan resident return reporting all income, then claim the credit for tax paid to Maine. The credit is capped at what Michigan would have charged on that same income, so if Maine taxes it at a higher rate the difference is not refunded.

The two states, side by side

 MichiganMaine
Taxes wagesYes — flatYes — graduated
Reciprocity partners6 (Form MI-W4)None
Convenience ruleNoNo
Nonresident returnForm MI-1040 with Schedule NRForm 1040ME with Schedule NR
Credit for other-state taxForm MI-1040 (credit for income tax imposed by another state)Form 1040ME Schedule A
Nonresident safe harbourNone published12 days or a dollar floor
Local income taxYesNo
Revenue departmentMichigan Department of TreasuryMaine Revenue Services
Last verified

The other direction

Reversing the commute does not always reverse the answer. Living in Maine and working in Michigan gives:Both states — credit offsets the double tax.

Maine to Michigan →

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.

Other Michigan pairs

Questions people actually ask

I live in Michigan and work in Maine. Which state takes the tax out of my paycheck?

Both states tax the same wages, and a credit undoes the overlap. Maine withholds as your work state and you file a Maine nonresident return; Michigan taxes residents on all income, so you also file at home and claim the credit for tax paid to Maine. File Maine first.

Which state should my employer be withholding for?

Maine. The wages are sourced to Maine, so Maine withholding is correct and there is no Michigan withholding to set up.

Will I end up paying tax twice on the same income?

Not twice over, but you will pay the higher of the two rates. Michigan gives residents a credit for tax paid to Maine on the same income, claimed on Form MI-1040 (credit for income tax imposed by another state). The credit is capped at the Michigan tax on that income, so if Maine taxes it more heavily the excess is not refunded by either state.

How current is this?

The Michigan and Maine rules on this page were last checked against Michigan Department of Treasury and Maine Revenue Services 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.