Freelance Writer Taxes in Michigan - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Freelance Writer income taxable in Michigan?

Yes, absolutely. As a freelance writer in Michigan, all income you earn is subject to both federal and state income taxes. Here's a breakdown:

• Federal Taxes: The IRS considers your freelance writing income as business income. You'll report this income (and related expenses) on Schedule C (Profit or Loss From Business), which is filed with your Form 1040. Schedule C allows you to deduct business expenses, reducing your taxable income.
• Michigan State Taxes: Michigan has a flat income tax rate of 4.05% for 2024. Your taxable income, after federal adjustments and deductions, will be subject to this rate. You'll report your income on Michigan Form MI-1040. Michigan also conforms to many federal deductions, meaning if you deduct something on your federal return, you can often deduct it on your Michigan return as well.

Top Tax Write-offs for Freelance Writers

One of the benefits of being self-employed is the ability to deduct legitimate business expenses. Here are some key deductions for freelance writers:

• Home Office Deduction: If you use a portion of your home exclusively and regularly for your writing business, you can deduct expenses related to that space (mortgage interest or rent, utilities, insurance, etc.). There's a simplified method based on square footage, or you can calculate actual expenses.
• Software & Subscriptions: Costs for writing software (like Scrivener, Grammarly), editing tools, plagiarism checkers, project management software, and subscriptions to research databases are all deductible.
• Computer & Equipment: You can deduct the cost of your computer, printer, and other equipment used for your writing business. For items with a useful life of more than one year, you'll likely need to depreciate the cost over several years, or you may be able to use Section 179 expensing or bonus depreciation to deduct the full cost in the year of purchase (subject to limitations).
• Mileage & Transportation: The 2024 standard mileage rate is 67 cents per mile for business use of your vehicle. Keep a detailed log of all business miles driven (e.g., to client meetings, research locations). You can also deduct parking fees and tolls. You cannot deduct commuting miles.

The 15.3% Self-Employment Tax Surprise

Many freelancers are surprised to learn about self-employment tax. When you're an employee, your employer pays half of your Social Security and Medicare taxes. As a freelancer, you're both the employer and the employee, so you're responsible for the full 15.3% (12.4% Social Security + 2.9% Medicare). However, you only pay this tax on profits exceeding $400. You'll calculate this tax on Schedule SE (Self-Employment Tax), which is filed with your Form 1040. The good news is you can deduct one-half of your self-employment tax from your adjusted gross income on Form 1040, reducing your overall tax liability.

Closing Tip for Michigan Residents

Don't wait until the last minute! Keep meticulous records of all your income and expenses throughout the year. Consider using accounting software or a spreadsheet to track everything. Also, remember that estimated tax payments are generally required quarterly if you expect to owe $1,000 or more in taxes. Consulting with a qualified tax professional (like myself!) can help ensure you're taking advantage of all available deductions and complying with all applicable tax laws. Wishing you a successful and tax-efficient year!