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Answer : No, if a surviving spouse meets certain conditions described below, the surviving spouse is entitled under subsection 30(10) to claim any of the subtractions under subsection 30(1)(f), subject to the same restrictions and limitations, for a single return, that would have applied based on the date of birth of the older of the two spouses. The subtractions under 30(1)(f) are as follows:
1. Public retirement or pension benefits from federal, Michigan, or local sources.
2. Public retirement or pension benefits from another state or its political subdivisions if the other state permits similar or reciprocal treatment.
3. Social Security benefits.
4. Private retirement or pension benefits, subject to the private retirement maximums.
To claim any combination of these deductions, the surviving spouse must (1) have claimed a deduction under any of the subparagraphs of 30(1)(f) on a joint return for the tax year in which their spouse died and (2) not have remarried. Thus, a taxpayer is not limited to the particular subparagraph(s) of 30(1)(f) claimed on the joint return in the year of the decedent spouse’s death.
Example G . Taxpayer Callie, born in 1960, files a joint return for tax year 2022 on behalf of herself and her recently deceased spouse, Weston, born in 1957. On the return, the couple claims a subtraction for Social Security benefits under subsection 30(1)(f)(iii). In tax year 2023, Callie receives both a private and a public retirement benefit in addition to her Social Security benefit. Even though in prior years neither spouse would have had a retirement deduction because they were both Tier 3 taxpayers (born after 1952), in tax year 2023, Callie can deduct 25% of the private maximum retirement benefit amount because her deceased spouse was born after 1945 and before 1959 (the criteria for a subsection (10) deduction for tax year 2023). She is not limited to the particular type of deduction claimed under 30(1)(f) on the joint return in the year of her spouse’s death.
Example H . Taxpayer Jo, born in 1955, files a joint return for tax year 2022 on behalf of herself and her recently deceased spouse, Ken, born in 1945. On the return, the couple claims a subtraction for Social Security benefits under subsection 30(1)(f)(iii). In tax year 2023, Jo received $50,000 of qualifying public retirement benefits. Jo is eligible based on the year of birth of her older, deceased spouse, to choose a retirement deduction under subsection (9)—specifically, for a Tier 1 retiree under subdivision (a)—and claim a subtraction for all public retirement benefits; therefore, Jo can deduct $50,000. Alternatively, Jo could have taken a subtraction under subsection (10)(a) using her own birth year, which would be limited to $15,380 (25% of $61,518); however, her deduction under subsection (9) is greater.