‘Game changer’ bill kills taxes on tips, overtime and Social Security — but it’s not from Trump. Here’s who’ll benefit

Core Insights - Michigan's state budget for fiscal year 2026 was passed with bipartisan support, featuring significant tax cuts that align with President Trump's previous proposals [2] - The tax cuts will eliminate the 4.25% income tax on overtime, tips, and Social Security benefits for the next three years, which Governor Whitmer described as a "game changer" for residents struggling financially [2] Tax Benefits Overview - Over 800,000 Michigan residents are expected to benefit from the tax cuts, including many seniors who will see a reduction in their tax burden [3] - The Michigan Earned Income Tax Credit for Working Families will expand, benefiting approximately 650,000 families, particularly those in middle- and lower-income brackets [3] Specific Savings Breakdown - An estimated 500,000 workers in sectors such as construction, manufacturing, healthcare, public safety, and food service will save an average of $500 in taxes due to the elimination of the income tax on overtime [4] - Around 300,000 individuals, including servers and delivery drivers, will save an average of $400, with the elimination of taxes on tips being crucial for their financial stability [4] - Approximately 40,000 seniors will save an average of $500 annually from the removal of state taxes on Social Security benefits [4]