How to File City Taxes in Michigan: Forms, Credits, and Deadlines

To file city taxes in Michigan, you need to know whether the city you live in or work in is one of the 24 municipalities that levy their own income tax, complete that city’s return (most use a shared form called the CF-1040, while Detroit and Grand Rapids use their own), and submit it with payment by April 30, two weeks after the federal and state deadline.¹² A city return is separate from your Michigan state return, and if you live in one taxing city and work in another, you may owe both.

Do You Have to File a City Return?

The Michigan City Income Tax Act lets municipalities levy a local income tax, and 24 currently do.¹ Most of them charge 1% on residents and 0.5% on nonresidents.³ Three cities charge more: Detroit at 2.4% resident and 1.2% nonresident,⁴ Highland Park at 2% and 1%,⁵ and Grand Rapids at 1.5% and 0.75%.⁶ Residents owe city tax on all income no matter where it was earned. Nonresidents owe only on wages and business income tied to work physically performed inside the city.

Each city sets its own filing threshold. Grand Rapids requires a return when income exceeds $600 for single or married-filing-separately filers and $1,200 for joint filers.⁶ Detroit’s thresholds are $750 and $1,500. Other cities publish their own in the form instructions.

File even if your income is under the threshold if any city tax was withheld from your paychecks, because that’s the only way to get a refund of money withheld in error. Self-employed people with net profits attributable to a taxing city have the same obligation.

One trap for commuters: if a nonresident’s estimated work inside the taxing city is less than 25% of total working time, the employer is not required to withhold.⁷ You still owe the tax. You just have to calculate and pay it yourself at filing time.

Which Form to Use and What to Gather

Most of the 24 taxing cities accept a standardized return called the CF-1040, often called the “common form.”⁸ Two cities don’t use it:

Detroit individual returns use the D-1040 series and are filed through the Michigan Department of Treasury rather than directly with the city.⁹
Grand Rapids uses the GR-1040 series on the city’s fiscal services website.

Pull your form from the city treasurer’s or income tax department’s website. Then gather your documents:

W-2 forms, with particular attention to Box 19 (city income tax withheld) and Box 20 (city name). If your employer withheld for the wrong city or wrong amount, fix that with your employer before filing.
1099 forms for freelance, investment, or other non-wage income connected to a taxing city.
Federal Schedules C and E if you have self-employment income or rental property attributable to a taxing city.

Calculating What You Owe

If you lived in a taxing city all year and worked there too, the math is straightforward: apply the resident rate to your total income.

If you’re a nonresident who doesn’t work entirely inside the taxing city, you have to allocate. Detroit’s nonresident form (D-1040 NR) uses Schedule N, which divides the days you physically worked in Detroit by your total working days across all locations to produce a percentage.⁴ Other cities use a similar calculation on the CF-1040 or their own nonresident form. Vacation days, holidays, and sick days come out of the total before you divide. Keep a calendar if your schedule varies, because this is exactly what a city auditor will ask about.

Part-year residents attach a Schedule TC to separate income earned while living in the city from income earned afterward. During the residency period, everything is taxed at the resident rate. After you moved out, only income sourced to the city is taxable at the nonresident rate.

Credit If You Live in One Taxing City and Work in Another

Michigan law allows a credit on your resident city return for taxes paid to the city where you work, covering wages, business profits, rental income, and capital gains on property sales earned outside your resident city.¹⁰ The credit is capped at what your resident city would have charged on that same income as a nonresident. You won’t be taxed twice on the same dollar, but you also won’t come out ahead.

Submitting the Return and Paying

Detroit returns go through the Michigan Department of Treasury’s e-file system or through compatible tax preparation software.⁹ Grand Rapids has its own online filing portal through fiscal services. Most smaller cities accept paper returns mailed to the city’s income tax office, and some offer electronic filing through third-party platforms listed on their sites.

If you mail a paper return, check the address carefully. Many cities use separate P.O. boxes for refund returns and balance-due returns, and sending to the wrong box slows processing.

For payment, every city accepts checks or money orders payable to the city treasurer, submitted with the payment voucher from the form packet. Most cities also take online payments by bank transfer or card through their official websites. Bank transfers are usually free; card payments carry a convenience fee of roughly 2% to 3%. Detroit payments go through the state Treasury’s online system.

The deadline for annual returns in most Michigan taxing cities is April 30.¹²

Extensions

Request more time with Form 5209, the Application for Extension of Time to File a City Income Tax Return. An approved extension pushes your filing deadline to October 15.¹¹ Federal Form 4868 and Michigan Form 4 don’t substitute for the city form.

The extension covers filing, not payment. Any tax you owe is still due April 30, and interest and penalties run from that date on unpaid balances regardless of your extension. Send a payment with the extension request if you expect to owe.

Estimated Payments If You Don’t Have Withholding

Self-employment earnings, rental income, and large investment gains usually don’t have city tax withheld at the source. If that describes your income, you may need to make quarterly estimated payments, due April 15, June 15, September 15, and January 15 of the following year.¹² You can base the estimate on your prior-year city return or on your federal estimated figures, adjusted to drop income and deductions the city ordinance doesn’t recognize.

Use the city’s estimated tax voucher for each payment. If your income shifts midyear, file an amended declaration with any quarterly payment and spread the remaining balance over the payments you have left.¹² Underpayment of estimated tax triggers the same interest as any other underpayment.

Penalties for Filing or Paying Late

Late filing or late payment runs 1% of the unpaid tax per month or partial month, capped at 25%.¹³ Interest also accrues at one percentage point above the adjusted prime rate per year, running from the original due date until you pay in full.

If the city finds your underpayment was due to negligence rather than an honest mistake, it adds a penalty of $10 or 10% of the deficiency, whichever is greater.¹³ For intentional disregard of the ordinance, the penalty rises to $25 or 25% of the deficiency, whichever is greater. Actual fraud carries a 100% penalty on the full deficiency.

Cities can waive the late-filing penalty for reasonable cause, but you have to request it and make the case. Interest is never waived.

1
Portland, MI – Official Website. Income Tax Office
2
City of East Lansing. Income Tax
3
City of Grand Rapids, Michigan. Other Michigan Cities with Income Tax
4
City of Detroit. Income Tax Information
5
City of Highland Park. Income Tax
6
City of Grand Rapids, Michigan. Income Tax Guide for Individuals
7
Michigan Legislature. MCL 141-651
8
City of East Lansing. Income Tax Forms
9
City of Detroit. Income Tax
10
Michigan Legislature. Michigan Compiled Laws 141-665 – Credit for City Income Tax Paid Another City
11
Michigan Department of Treasury. Form 5209 Instructions for City Income Tax Return Application for Extension of Time to File
12
Michigan Legislature. Michigan Compiled Laws 141-663 – Declaration of Estimated Tax Not Withheld
13
Michigan Legislature. Michigan Compiled Laws 141-682 – Payment of Tax, Interest