Hamtramck Income Tax: Rates, Filing, and Credits

The Hamtramck income tax is a local levy under Michigan’s City Income Tax Act: residents pay 1% on all taxable income, nonresidents pay 0.5% on income earned inside the city, and corporations pay 1% on net profits attributable to Hamtramck. Returns are filed on paper Form H-1040 and are due April 30 for the prior tax year.

Rates by Filer Type

Residents: 1% on all taxable income, no matter where it was earned.
Nonresidents: 0.5% on income tied to work performed or business conducted in Hamtramck.
Corporations: 1% on net profits attributable to business activity in the city.¹

What Hamtramck Taxes

If Hamtramck is your domicile, you owe tax on income from every source. That includes wages, salaries, bonuses, tips, commissions, self-employment and business income, partnership distributions, rental income, dividends, interest, capital gains net of losses, and income from estates or trusts.²

Nonresidents are taxed only on income connected to Hamtramck: wages for work actually performed in the city, profits from a business operating there, rent from property inside the city, and gains from selling real or tangible personal property located there.³ If you split your working days between Hamtramck and another location, you allocate wages based on the ratio of days actually worked in the city.⁴

Retirement Income: Watch the Early Withdrawals

Pension and retirement benefits received after you qualify for retirement under the plan are exempt. Early distributions are not. Withdrawals from 401(k), 457, and 403(b) plans taken before the plan’s retirement age are taxable, as are premature pension distributions and early retirement incentive payments not paid from a pension trust.³ If you cashed out a 401(k) early, it belongs on your Hamtramck return.

Income That Isn’t Taxed

Several categories are carved out of the city tax:⁵

Pensions and retirement benefits received after you qualify for retirement, including annuitized payments over the recipient’s life.
Life insurance proceeds and payments for personal injury or sickness, to the same extent excluded federally.
Military pay for service in the U.S. armed forces.
Unemployment compensation, supplemental unemployment benefits, and workers’ compensation.
Interest on U.S. Treasury bonds and state or local government obligations.
Gifts and inheritances.

Social Security benefits are not listed among the Act’s taxable categories and do not appear on the Hamtramck return.

Credit If You Also Pay Detroit or Another City

Hamtramck sits inside Detroit, and Detroit runs its own city income tax. If you live in Hamtramck and work in Detroit (or any other Michigan city that taxes income), you can claim a credit on your Hamtramck return for tax paid to the other city. The credit is capped at the amount Hamtramck would have charged a nonresident on that same income, so it reduces but does not always eliminate the Hamtramck bill.⁶ The credit schedule on the return walks through the calculation for your specific numbers.

Who Has to File

You must file a Hamtramck return if your taxable income is greater than your total personal and dependency exemptions, even if you did not file a federal return.³ Each exemption is worth $600, so a single filer with no dependents has to file once taxable income tops $600.

Filing status turns on domicile. Full-year Hamtramck domicile means you file as a resident. Domicile outside the city all year, with income earned inside it, means you file as a nonresident. Moving in or out mid-year makes you a part-year resident: use Form H-1040TC to split income between the resident and nonresident periods, then attach it to the H-1040.³

Deadline and Extensions

Returns for the 2025 tax year are due April 30, 2026.³ That is fifteen days after the federal deadline, which is easy to forget once you’ve already sent off your federal and state returns.

The city grants an automatic six-month extension if you file the extension request by April 30, complete the tentative tax section, and pay any estimated balance due with the request. An extension buys time to file, not time to pay. Submitting the extension form without payment when tax is owed means the extension will not be accepted.⁷ A federal Form 4868 filed with the IRS does not extend your Hamtramck deadline. You need a separate city extension.

Estimated Quarterly Payments

If your Hamtramck liability will beat your withholding and credits by $100 or more, you’re expected to make quarterly estimated payments.³ This usually catches self-employed people, landlords, and anyone whose employer isn’t withholding Hamtramck tax.

The 2026 due dates are:⁸

First quarter: April 15, 2026
Second quarter: June 15, 2026
Third quarter: September 15, 2026
Fourth quarter: January 15, 2027

Each payment should be at least a quarter of the total estimated tax for the year. H-1040ES vouchers are posted on the city’s income tax page.⁹

Filing the Return

Residents and nonresidents both file Form H-1040. Have your W-2s showing Hamtramck wages and any 1099s for other taxable income. The H-1040 reads like a simplified federal return: enter income on the applicable lines, subtract exemptions, apply the rate.¹⁰ Each personal and dependency exemption cuts $600 from taxable income, which at the 1% resident rate saves a resident $6 per exemption.³ List dependents accurately anyway; the number ties back to your federal return. Enter your employer’s name, address, and federal identification number so withholding credits match to your account.

All forms — H-1040, business returns, extension applications, estimated vouchers — are on the city’s income tax page.⁹ Hamtramck does not accept e-filed returns. Submit paper.

Where to Send It

Returns with a balance due and refund or zero-balance returns both go to the same address:

City of Hamtramck – 1040 Payments
P.O. Box 209
Eaton Rapids, MI 48827³

Make checks or money orders payable to the City of Hamtramck. You can also drop off a paper return at the Income Tax Office at City Hall.⁹

Penalties and Interest for Paying Late

Unpaid tax starts running penalty and interest the day after the due date, extension or no extension. Penalty is 1% per month on the unpaid balance, capped at 25%. Interest runs separately at 1% above the prime rate on an annual basis. The minimum combined charge is $2.00.³ Missing required quarterly estimates when your liability outpaces withholding by $100 or more triggers the same charges.

The practical rule: if you know you’ll owe, pay the estimated amount by April 30 whether or not you extend. The extension protects you from late-filing consequences; it does nothing for late payment.

A Note for Employers

Any employer with a location in Hamtramck, or otherwise doing business inside the city, has to register with the Income Tax Department and withhold city income tax from employee wages, even if the main office is elsewhere. Registration is done on Form H-SS-4, and quarterly withholding is reported on Form H-941.¹¹ If your employer doesn’t withhold Hamtramck tax, the obligation doesn’t go away: you cover it through estimated payments or with your return.

1
Michigan Legislature. MCL Section 141.503
2
Michigan Legislature. City Income Tax Act 284 of 1964 – Section 12
3
City of Hamtramck. Hamtramck Individual Income Tax Forms and Instructions
4
Hamtramck City. Hamtramck Schedule L Instructions Form
5
Michigan Legislature. City Income Tax Act 284 of 1964 – Section 32
6
Michigan Legislature. MCL Section 141.665
7
City of Hamtramck. Application for Extension of Time to File Income Tax Return
8
Michigan Department of Treasury. 2026 City Estimated Income Tax for Individuals
9
Hamtramck, City (Wayne, MI). Income Tax
10
City of Hamtramck. City of Hamtramck Income Tax Form H-1040 Individual Return
11
City of Hamtramck. H-SS-4 City of Hamtramck Employer Withholding Registration Form and Instructions