Income Tax Frequently Asked Question

what is an estimated tax payment

Where do I mail my tax return ?

Returns with Payments Should Be Mailed To:

City of Pontiac 1040 Payments P. O. Box 530 Eaton Rapids, MI 48827

Returns without Payments Should Be Mailed To:

City of Pontiac Income Tax Division P. O. Box 530 Eaton Rapids, MI 48827

What are some of the common mistakes made when filing income tax returns?

What is the tax rate for City of Pontiac Tax?

The individual tax rate is 1% (.01) for residents and ½% (.005) for nonresidents. The corporation tax rate is 1% (.01).

When is my City of Pontiac Income Tax annual return due?

City of Pontiac Income tax returns are due on or before April 30th, or within 4 months after the end of your fiscal year.

What are the penalty and interest charges if I pay my income tax late?

If you file and pay late, penalty is calculated at a rate of 1% per month with a maximum of 25% of the tax due. Interest is due at the annual rate of ½% above the current prime rate. The current interest rate on income tax delinquencies is established by the State of Michigan, Department of Treasury. This rate is adjusted on January 1st and July 1st, of each year.

How do I file an extension?

Requests for an extension must be made in writing to the City of Pontiac, Income Tax Division. The Administrator may extend the filing date for up to six months or for the same period of time granted by a federal extension. To request more time to file your return, complete an extension form and submit with payment to cover the estimated tax due to the City of Pontiac Income Tax Division or before the due date of the return. An extension does not extend the date for payment of the tax due. If no tax is owed or you are receiving a refund, do not file an extension.

What is taxable income?

A resident taxable income includes:

Salaries, bonuses, wages, commissions, fees, vacation pay, profit sharing plan income and other compensation regardless of where income was earned.

Deferred compensation distributions.

Lottery winnings.

Fair market value of merchandise or services received as compensation.

Net profit of a business or profession regardless of where earned.

Rental income, capital gains and dividends.

Income from a partnership, S corporation estate or trust, interest from bank accounts, credit unions, savings and loan associations no regardless of where income was earned.

A nonresident taxable income includes:

Salaries, bonuses, wages, commissions, fees, vacation pay, profit sharing plans and other compensation earned in Pontiac.

Net profits from rental of real and tangible property located in Pontiac.

Net profits from the operation of a business or profession conducted in Pontiac.

Fair market value of merchandise or services received as compensation in Pontiac.

Net profits from sale or exchange of person property located in Pontiac.

What is nontaxable income to both resident and non resident?

Gifts, inheritances and bequests.

Pensions and annuities, proceeds from insurance and retirement benefits.

Unemployment compensation, supplemental unemployment benefits, welfare relief payments and workmen’s compensation.

Interest from U S obligation such as Savings Bonds and Treasury Notes.

Compensation of service in the U S armed forces,

including reserve components.

What are the requirements for remitting Individual and Corporate estimated payments?

The estimated tax for the current year may be paid in full with the first payment or in four (4) equal installments on or before April 30th, June 30th, September 30th, and January 31st of the following year.

For corporations on a fiscal year the payments are due on before the 4th, 6th, 9th, and 13th month after the beginning of taxable fiscal year.

What are the requirements for remitting monthly or quarterly withholding tax payments?

Monthly payment: Required where the amount withheld exceeds $100.00. Payment is due on or before the last day of the month following the period in which taxes were withheld.

Quarterly payments: Allowed where amount withheld does not exceed $100.00 per month. Payment is due on or before the last date of the month following the quarter in which taxes are withheld.

Employers must submit an Annual Reconciliation (PW-3) by February 28th along with the Wage and Tax Statement (W-2’s) at the end of each tax year.

Who must file a Corporate Income Tax Return (P-1120)?

Every corporation doing business in the City of Pontiac, whether or not it has an office or place of business in the city or net profit, is required to file a City of Pontiac Income Tax Corporation Return, Form P-1120. Sub Chapter S corporations are treated as C corporations and must file an P-1120. Non–profit corporations, which have applied for and received approval for exemptions from Federal income tax, shall not be required to file a return, providing they submit, to the Administrator, a copy of their exemption approval from the Internal Revenue Service. Such exemption from the City’s filing requirement will continue in effect as long as their Federal exemption is in effect.

Who must file a Partnership Income Tax Return (P-1065)?

Every partnership that conducted business in the City of Pontiac, whether or not an office or place of business was maintained in the city is required to file.

How long must I wait for the tax refund?

Refunds are paid normally within 90 days of filing or 45 days after April 30th, whichever is later. In case a return is audited, refunds can be delayed depending on the taxpayer’s response time. Returns filed without the following documentation will also be returned to the taxpayers resulting in delayed refunds and/or disallowance of deductions/credits claimed:

  • Signatures
  • W-2’s
  • Allocation exclusion formula and worksite(s).
  • Federal schedules-C, D, E, Form 2106, etc.
  • Copy of 1 st page of Federal 1040 to verify IRA and alimony deductions
  • Copy of the appropriate City income tax return if other city credit applies.

Can I electronically file my City of Pontiac return?

Yes. Electronic filing of your 2010 city income tax returns is now available. Click Here to Start Filing .

You can make individual estimated payments online, too. Click here to get started

Will the City of Pontiac mail out individual tax forms to taxpayers?

The City will not be mailing tax forms for 2012 except for withholding and estimated tax vouchers. The tax returns, instructions and other income tax forms can be downloaded from the City website @ www.pontiac.mi.us. The City will print flat forms and instructions for distribution to other neighboring sites.

Source: www.pontiac.mi.us

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