Calculating Detroit City tax

**hathorlive** · March-14-13, 10:30 PM

Just moved to Detroit in December of last year. I'm trying to figure out what/how to pay City taxes. Can anyone give me some pointers in how to figure out what you owe? Thanks!

**313WX** · March-14-13, 10:38 PM

Basically the same way you would fill out a Federal/State 1040 form.

As for how I do it, I fill out the form below, put it in an envelope with my Money Order plus W-2 and mail it to the below address.

http://www.detroitmi.gov/Portals/0/d...40[[R)%2012.pdf

http://www.detroitmi.gov/Departments...2TaxForms.aspx

City of Detroit
P.O. Box 33401
Detroit, MI 48232

http://www.detroitmi.gov/Departments...sion/FAQs.aspx

If you earn greater than $600 then you must pay taxes.

**hathorlive** · March-14-13, 10:45 PM

Thanks for the information. I don't work in Detroit, so they didn't take any taxes out of my pay check for it. I was told by my HR department that I have to calculate up what I owe and send it in myself. I've never had to do that before, so I called the tax office and am waiting a call back [[LOL...I've learned what that means in my short time in the city). But I'm just confused about what percent of gross or net do I take? I will look at those links 313WX. Thanks!

**313WX** · March-14-13, 11:02 PM

Originally Posted by hathorlive

Thanks for the information. I don't work in Detroit, so they didn't take any taxes out of my pay check for it. I was told by my HR department that I have to calculate up what I owe and send it in myself. I've never had to do that before, so I called the tax office and am waiting a call back [[LOL...I've learned what that means in my short time in the city). But I'm just confused about what percent of gross or net do I take? I will look at those links 313WX. Thanks!

It's a percentage of your Taxable Income [[which is your AGI or Gross Income minus any exemptions and deductions you have).

Your AGI or Gross Income would be your wages on the W-2 form your employer send out plus any other income you earn such as interest, tips, etc.

So after calculating your exemptions [[multiply the number of exemptions by $600 and subtract that number from your AGI) on lines 1, 3-7 and 9 [[also calculate any deductible moving or business expenses on line 2 and subtract them from your AGI), you basically just multiply that number by 2.5% and put that multiplied number on line 12. Since your taxes weren't withheld, you can skip from line 12 to line 20.

The exemptions work the same way as they would for your federal taxes. So if no one can claim you as a dependent, you can claim an exemption for yourself. If you have a spouse you support, you can claim an additional exemption for them. You can also claim an exemption for each child you have.

**DetroitPlanner** · March-15-13, 08:08 AM

Just take everything that was not deducted by the Feds, SSI, medicare, the State, the United Fund and send it to the City!

Seriously, Just remember that when you live in Detroit you have to pay tax on any bank interest or capital gains as well. Personally, I think that this is one of many things that drives those with a lot of wealth to live outside of the City. For the time you did not live in the City you do not have to pay this.

**gnome** · March-15-13, 09:04 AM

if you don't live in the city itself, you deduct the days you arent here.

there are 365 days, deduct your max sick time, vacation time, weekends, holidays and any time you were working out-of-town. if you work it out you'll find you were inside the city limits only 200 out of the possible 365.

[[your results may vary)

**Hamtragedy** · March-15-13, 09:07 AM

Originally Posted by hathorlive

, so I called the tax office and am waiting a call back

More incompetence. Imagine that.

**Honky Tonk** · March-15-13, 09:38 AM

Originally Posted by hathorlive

Thanks for the information. I don't work in Detroit, so they didn't take any taxes out of my pay check for it. I was told by my HR department that I have to calculate up what I owe and send it in myself. I've never had to do that before, so I called the tax office and am waiting a call back [[LOL...I've learned what that means in my short time in the city). But I'm just confused about what percent of gross or net do I take? I will look at those links 313WX. Thanks!

Something's not right with your HR Department. I live in the City but don't work there, and COD taxes are witheld on my W2. Probably someone who didn't know, gave you the wrong info. I would talk to your Payroll Department directly.

**Ray1936** · March-15-13, 04:01 PM

Makes me glad to live in Nevada. No state income tax; no city income taxes.

**rutlev** · March-15-13, 04:23 PM

I was only one of 3 who lived in Detroit and worked outside the City and I was able to get the company to deduct the city income tax. The other 2 had been employed there for a couple of years and were quite angry with me as they had no intention of paying the income tax and then got nailed for past years. Oh well and we wonder how things got out of control.

**kenp** · March-15-13, 04:26 PM

Originally Posted by Ray1936

Makes me glad to live in Nevada. No state income tax; no city income taxes.

That seems to be the same thing here in the D

**313WX** · March-15-13, 05:17 PM

Originally Posted by Honky Tonk

Something's not right with your HR Department. I live in the City but don't work there, and COD taxes are witheld on my W2. Probably someone who didn't know, gave you the wrong info. I would talk to your Payroll Department directly.

No, my employer in the suburbs is the same way as the OP. They choose not to deal with the headache of Detroit's tax system.

If suburban companies who hire city employees are required in withhold your taxes, the city certainly isn't enforcing it.

**313WX** · March-15-13, 05:23 PM

Originally Posted by gnome

if you don't live in the city itself, you deduct the days you arent here.

there are 365 days, deduct your max sick time, vacation time, weekends, holidays and any time you were working out-of-town. if you work it out you'll find you were inside the city limits only 200 out of the possible 365.

[[your results may vary)

That's true. You only pay taxes for the income you earn while you officially resided in Detroit if you work in the suburbs.

**hathorlive** · March-15-13, 11:06 PM

Originally Posted by 313WX

That's true. You only pay taxes for the income you earn while you officially resided in Detroit if you work in the suburbs.

So confusing. I spent a part of the one month I lived in Detroit for 2012 on business trips. It's hard to know what to try to calculate but it seems like the City seems to have less of a clue than I do.

Honky Tonk, The HR department insists that it's not their issue. I actually work in A2, so maybe it's because it's so far from Detroit and not an area on the immediate city limits?

Kenp, It's a shame when people get in trouble for not doing what their supposed to. I just want to send in the right amount so I don't have future issues.

313WX, I think I've figured it out with your math. Thanks for all the help, board!!! It's nice to have a resource to learn more about Detroit.

**Vic_doucette** · March-16-13, 10:40 AM

True story: I've lived in and/or worked in Detroit since 1989. My income has varied widely during that time. Whether I made close to $50,000 or less than $10,000 in any given year, when it all shook out, the city owed me a $15 refund. Every year. Year after year. This year? Same as it ever was.

**313WX** · March-16-13, 10:45 AM

Originally Posted by Vic_doucette

True story: I've lived in and/or worked in Detroit since 1989. My income has varied widely during that time. Whether I made close to $50,000 or less than $10,000 in any given year, when it all shook out, the city owed me a $15 refund. Every year. Year after year. This year? Same as it ever was.

That's because the minimum taxable income level is so damn low [[$600).

**jtf1972** · March-16-13, 08:30 PM

What a load of crap that you have to pay income tax on income earned elsewhere when you simply live in the city. I have never seen this before, anywhere else. I would have loved to have had a job in the city and paid taxes to the city on that, but I have not been able to find a job in the city [[barely have one outside it, as the case is...)

Basically, I earned in Detroit the same as someone who doesn't have a job at all. I have to pay for income earned outside of the city. The cities I work in do not have city taxes, or I would have to pay income taxes both there AND where I live. Makes no sense to me.

**DetroitPlanner** · March-17-13, 06:00 AM

Originally Posted by jtf1972

What a load of crap that you have to pay income tax on income earned elsewhere when you simply live in the city.

Detroit is not the only City where this happens. If you don't want to pay City Income tax on you Income, I suggest you move elsewhere. You would not be the first person to realized this. Just don't move to Pontiac, Hamtramck, ......
http://www.michigan.gov/taxes/0,4676...955--F,00.html

**Honky Tonk** · March-17-13, 06:58 AM

Originally Posted by hathorlive

Honky Tonk, The HR department insists that it's not their issue. I actually work in A2, so maybe it's because it's so far from Detroit and not an area on the immediate city limits?

Since multiple people have posted this same response, I guess it happens. Where I work there are several people that drive in from A2, so I don't think distance is the issue. I've worked for many employers in my life, and every W2 I've ever seen has a box for "City and Local Tax". I can't answer the legalities on whether or not an employer is bound by law to deduct "City And Local" taxes. As far as residency, make sure you can verify that you actually lived in another State. With the non collected tax issue surfaced, and EFM in Detroit, they might start looking @ submitted tax forms a bit closer.