Cohabitation and Common Law Marriage

• In some states, if a couple lives together for an extended period and intend to marry, tell others they're husband and wife, or have the reputation as spouses, they may be considered common law spouses. These states include Colorado, Iowa, Alabama, Kansas, Montana, South Carolina, Oklahoma, Pennsylvania, Texas, Utah, Rhode Island, and Washington, D.C.
  
  

Michigan's Stance on Common Law Marriage

• In Michigan, no matter how long you cohabitate, you aren't a common law spouse and can't file a joint tax return, since the state does not recognize common law marriages and only married filers can file a joint return. If you established a common law marriage in another state, Michigan still doesn't recognize it. If your life partner owes back taxes, you aren't responsible for the tax bill.
  
  

Income Tax Dependent

• Michigan uses the Internal Revenue Services' interpretation of a dependent. If the taxpayer paid over half the living expense of the cohabitant, was a member of the taxpayer's household and that home is her principal residence, the cohabitant is a dependent of the taxpayer. In Michigan, it means the taxpayer receives a $3,600 exemption for the dependent.
  
  

Estate Tax or Inheritance Tax

• In some states, there's an estate tax or an inheritance tax. Since Michigan's estate tax tied directly to the state tax credit on federal estate tax and that no longer exists, Michigan does not have an estate tax. Unlike some states such as their neighbor, Indiana, Michigan does not have an inheritance tax. The property recipient pays the tax on assets received from the estate. Cohabitants don't have a death tax penalty in Michigan.