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Return to:                                                                                                                       PRSRT STD
                                                                                                                                U.S. POSTAGE
                INCOME TAX DEPARTMENT                                                                                                PAID
                P.O. BOX 29                                                                                                     PERMIT NO. 467
                MUSKEGON, MICHIGAN 49443                                                                                    MUSKEGON, MICHIGAN

If mailing label affixed, please peel off label and place
it over address area of your Muskegon Income Tax
Return. Do not use a label containing an error.










                                                              2005 MUSKEGON
                                                    INDIVIDUAL INCOME TAX RETURN
                                                             FORMS AND INSTRUCTIONS
                                                        FORM M-1040 AND FORM M-1040EZ
                                             ALL PERSONS HAVING $600.00 OR MORE OF MUSKEGON
                                               TAXABLE INCOME DURING 2005 MUST FILE A RETURN

 DONATE YOUR The D.A.R.E. (Drug Abuse Resistance Education) program needs your support. Donate your overpayment (refund) to fund
 OVERPAYMENT this Police Department program and help teach kids to say no to drugs and violence. To donate your overpayment, see
                         instructions on page 4, or see instructions for overpayments on the back page of the M-1040EZ form.

   TAX FORMS             Taxpayers that have their taxes prepared professionally or by a software product will not be sent a tax booklet the following
                         year. Tax forms are available online at: http://www.shorelinecity.com/incometax.asp

                                                               WHY USE DIRECT DEPOSIT?
      DIRECT             * Faster refunds                          * Payment more secure (no check to get lost)
     DEPOSIT             * More convenient, no trip to the         * Saves tax dollars. A refund by direct deposit costs
                           bank to deposit your check               less than a check.

    TAX RATE             RESIDENT: One percent (1% or .01)
                         NON-RESIDENT: One-half of one percent (.5% or .005)

  FILING DATE            Your return must be filed by May 1, 2006. Penalty and interest, as provided by law ($2.00 minimum), will be assessed on all
                         late payments.
  PAYMENT OF             Tax due, if one dollar ($1.00) or more, must be paid with your return.
     TAX DUE             Make check or money order payable to: City of Muskegon
                         Mail return and payment to the address below.
     MAILING             Income Tax Department
    ADDRESS              P.O. Box 29
                         Muskegon, Michigan 49443-0029
 DECLARATION             If you are paying $100.00 or more with your 2005 return, you may need to file a Declaration of Estimated Income
 OF ESTIMATED Tax, Form M-1040ES, for 2006. See Instructions for Filing a Declaration on page 4.
   INCOME TAX

        FOR              For assistance, visit the Income Tax Department, City Hall, 933 Terrace, Muskegon, Michigan or call the Income Tax
  ASSISTANCE             Department at (231) 724-6770.

                            W-2 forms attached add up to the wages on line 1.
                            W-2 forms attached add up to the Muskegon Tax withheld.
      CHECK                 Federal schedules attached support figures reported on lines 6, 7, 10 and 14. (M-1040 only)
  TO SEE THAT               Schedules attached support all exclusions, adjustments and deductions claimed. (M-1040 only)
                            A copy of other city's tax return is attached to support credit claimed.
                            Front page of the Federal 1040 must be attached.

                          Failure to attach documentation or attaching incorrect or incomplete documentation
                        will delay the processing of the return or result in corrections being made to the return.

                                                             We will not prepare your return.



                                                    2005 MUSKEGON M-1040 INSTRUCTIONS
WHO MUST FILE A RETURN                                                               paraplegic, quadriplegic, hemiplegic or totally and permanently disabled.
Every individual who had $600.00 or more of Muskegon taxable income during           Individuals claimed as an exemption on a parent's return may claim
2005, must file a City of Muskegon Individual Income Tax Return, Form M-             themselves on their own return.
1040.                                                                                Multiply line 17 by the proper tax rate to compute tax liability.
The filing of a declaration of estimated tax does not excuse a taxpayer from         Be sure Muskegon tax withheld as claimed on line 19 agrees with the total tax
filing an annual return even though there is no change in the declared tax           withheld on the W-2 forms attached to return.
liability or an additional amount of tax due.                                        The credit for payment of 2005 Estimated Income Tax, line 20 is the actual
Partnerships, corporations, estates and trusts shall file on forms provided for      amount paid to the city for the 2005 tax year, not the allowable itemized
their specific use.                                                                  deduction claimed on the federal return.
Filing must be made on City of Muskegon forms. Other cities' forms are not           Credit for income tax paid to another Michigan city is claimed on line 21.
acceptable.                                                                          Attach a copy of the other city's return to support credit.
The fact that a taxpayer is not required to file a federal income tax return does    If the total tax payments and tax credits, line 23, are less than tax liability, line
not relieve him/her from filing a Muskegon tax return.                               18, enter the tax due on line 24. If the tax due is more than $1.00, THE TAX
MARRIED PERSONS - JOINT OR SEPARATE RETURNS                                          DUE MUST BE PAID WITH THE RETURN WHEN FILED, OR BY THE DUE
                                                                                     DATE.
Married persons may file either a joint return or separate returns. If a joint
return is filed, all income of both husband and wife must be included in the         If line 23 is more than line 18, show overpayment to be donated on line 25 or
return. A joint return must be signed by both individuals, otherwise, it will not    refund requested on line 26 or credited to 2005 estimated tax on line 27.
be treated as a joint return. Both names must be listed in the heading (i.e.         The taxpayer, the spouse if a joint return, and the person preparing the return
John A. and Mary B. Doe).                                                            MUST SIGN THE RETURN.
If separate returns are filed, neither spouse can claim the other as a               ADJUSTMENTS AND DEDUCTIONS ALLOWED
dependent on their separate return. In addition, children and other dependents       No deductions are allowed for personal expenses or itemized deductions such
may only be claimed by the spouse who claims such dependents under the               as, taxes on your home, sales tax, church and charitable deductions or
Federal Internal Revenue Code.                                                       medical expenses.
Couples married during the year where one spouse had a different residency           No deductions are allowed for state or federal taxes paid.
status than the other may file separate returns, based on each one's place of
employment and residency during the year, or the couple may file a joint return      The adjustments allowed are those from page 1 of the Federal 1040; IRA
using Form M-1040TC to compute their tax.                                            deduction, moving expenses, Keogh and SEP plans, alimony and IRA
                                                                                     deduction on page 1 of Federal 1040A. Adjustments to income include the
EMPLOYERS THAT DID NOT WITHHOLD                                                      following:
On page 2, Schedule J, list employers who paid you or your spouse wages in                MOVING EXPENSE for moving into the Muskegon area. Do not include
2005, but did not withhold Muskegon income tax and did not furnish a city                 expenses of moving from Muskegon. Attach a copy of Form 3903 or
copy of Form W-2 for Muskegon.                                                            similar schedule.
AMENDED RETURNS                                                                           EMPLOYEE BUSINESS EXPENSES after adjustment for any
An amended return, M-1040-X, must be filed where necessary to report                      reimbursement by employer, but not subject to the 50% federal reduction
additional income, pay additional tax due, or claim an additional refund. An              for meal expense. Attach a copy of form 2106 or, similar schedule.
amended return is due within 90 days of the date of a final determination of a            Expenses are those allowed per IRS Code, limited to travel only.
federal tax liability which also affects the city income tax liability.                   Business expenses claimed on Line 4 of Federal Form 2106 are not an
INSTRUCTIONS FOR PAGE 1                                                                   allowable deduction on the Muskegon return unless the taxpayer qualifies
                                                                                          as an outside salesperson. Prorate on basis of related taxable income.
Enter your name, social security number, address and occupation in the boxes              Expenses related to non-taxable income are not allowed
provided.                                                                                 IRA, Keogh, and SEP adjustments are allowed in proportion to taxable
If a joint return, enter spouse's first name, social security number and                  income if allowed on Federal return. Adjustments related to income not
occupation.                                                                               taxable by Muskegon are not allowed.
Social security numbers must be correct and agree with those on the attached              FORFEITED INTEREST - allowed for residents only.
W-2 forms. THIS IS IMPORTANT.                                                             ALIMONY - must be prorated on basis of Muskegon taxable income to
Enter the name of your present employer.                                                  Federal taxable income. Do not include child support.
If a joint return, enter spouse's present employer.                                       Supplemental unemployment benefits (S.U.B.) are not taxable, therefore,
If married and filing a separate return, enter your spouse's name and social              repayment of (S.U.B.) is not allowed as a deduction.
security number in the separate return box. If you were married in 2004 and          EXEMPT INCOME
had a different residency status from that of your spouse, file separate returns
or use Form M-1040TC.                                                                The following income (included in column I) is not taxable to either a resident
                                                                                     or non-resident and should be excluded in column II and explained on the
Check the proper box to indicate your residency status.                              appropriate schedule on page 2.
If you were a resident for only part of 2005, use form M-1040TC to compute           Gifts and bequests; non-profit bingo winnings;
your tax and attach it to the M-1040 filed.                                          Proceeds of insurance, annuities, retirement plans (excluding early
Complete the exemptions section by checking the boxes that apply to yourself         distributions) and social security;
and spouse, if a joint return. Enter the first names of dependent children that
live with you and the total number of other dependents, their full names and         Welfare relief, unemployment benefits including supplemental unemployment
relationship, and the total number of exemptions claimed.                            benefits (S.U.B.), and worker's compensation.
In column I enter income from Federal Return. In column II enter income NOT          Interest from U.S. bonds, Municipal Bonds and Treasury Bills;
subject to Muskegon income tax (exclusions). Explain exclusions by                   Amounts paid to any employee as reimbursement for expenses necessarily
completing the schedules on page 2 or on separate schedules attached to the          and actually incurred in the performance of service and deductible as such by
return.                                                                              the employer;
ATTACH COPIES OF FEDERAL SCHEDULES TO SUPPORT ALL ENTRIES                            Compensation received for service in the armed forces of the United States,
ON LINES 6, 7 AND 10 OF COLUMN I.                                                    including the reserves.
Subtract column II from column I and enter difference in column III. If there are    DECEASED TAXPAYER
no exclusions in column II, use column III only. Support figures with schedules.     Attach Federal Form 1310, or death certificate, if taxpayer or spouse is
Multiply the number of exemptions allowed by $600.00. Include the extra              deceased.
exemptions allowed by Muskegon for an individual 65 or older, blind, deaf or

                                                                           INSTRUCTIONS PAGE 2



                                           TAXABLE AND NON-TAXABLE INCOME AND EXCLUSIONS
                                                                       PART YEAR RESIDENT
M-1040TC - Tax Calculation Schedule                                                     allocated. Taxable income earned while a resident is reported in the Income
A PART YEAR RESIDENT WITH TAXABLE INCOME AS BOTH A RESIDENT                             Earned as a Resident column. Taxable income earned while a non-resident is
AND A NON-RESIDENT, must use Form M-1040TC, Tax Calculation                             reported in the Income Earned as a Non-resident column. Non-taxable income
Schedule, to calculate the liability.                                                   and excludable income as either a resident or non-resident is reported in the
                                                                                        Excludable Income Adjustments and Deductions column. Use the instructions
A part year resident who has taxable income only as a resident or non-resident          for residents and non-residents as a guide to allocate income.
may file using the regular M-1040 form including an explanation on Schedule J,
page 2, stating: Part year resident with taxable income only as a resident (non-        Follow the instructions on Form M-1040TC. If questions arise, phone the
resident). The tax rate for taxable income as a resident is 1% (.01). The tax           Income Tax Department at (231) 724-6770.
rate for taxable income as a non-resident is 0.5% (.005).                               NOTE: Copies, schedules and other documentation supporting exclusions,
Allocation of Income on Form M-1040TC                                                   adjustments and deductions must be attached. Failure to attach schedules and
                                                                                        documentation or attaching incomplete or incorrect schedules and
Income is allocated according to the residency status for each item of income.          documentation will delay the processing of your return or result in deductions
Adjustments and deductions must be allocated in the same way income is                  being disallowed.

                                                                               RESIDENT
LINE 1 - Wages, Salaries, Tips, etc.                                                    LINE 9 - Pensions and Annuities
A resident is taxed on ALL earnings, including salary, bonus, separation and            Enter on line 9 - column I, the pension and annuities reported on Federal Form
incentive payments, tips, commissions and other compensation for services               1040 or Form 1040A.
rendered, REGARDLESS WHERE EARNED. EXAMPLE: Taxpayer lives in the
City of Muskegon but works in Norton Shores and receives his paycheck from the          Annuity distributions are excludable. Pension distributions qualifying as
home office in New York City, 100% of the compensation is taxable.                      retirement benefits are excludable. Early distributions from a pension plan are not
                                                                                        excludable.
Report, on line 1 column I, the amount of wages, salaries, tips, etc. from Federal
Return. (Form 1040, form 1040A, Form 1040EZ).                                           LINE 10 - Supplemental Income
Military pay and supplemental unemployment benefits are NOT taxable. (Exclude           Enter on this line in column I, the total amount shown on the Federal Return,
on page 2 Schedule A, line 3).                                                          Form 1040.
Attach W-2 forms for all compensation or list the employers who did not withhold        Support exclusions with Schedule H, page 2 and by attaching Federal Schedules
Muskegon tax in Schedule J.                                                             E and/or F. Exclude undistributed share of Sub-Chapter S corporation income.
                                                                                        Losses from passive activities are treated the same as on Federal Form 1040.
A taxpayer, who was a resident part of the year and lived and worked outside the
City the balance of the year, shall be taxed only on his earnings while a resident.     LINE 11 - Unemployment Compensation
LINE 2- Interest                                                                        Enter on line 11, column I, the Unemployment Compensation reported on
                                                                                        Federal Form 1040 or Form 1040A. Exclude Unemployment compensation in
Interest is taxable the same as on the Federal return except interest on                column II. It is not taxable.
U.S.Bonds, Treasury Bills and notes is excluded.                                        LINE 12 - Social Security
Report on line 2, column 1, the amount of taxable interest income from Federal
Return. I (Form 1040, Form 1040A or 1040EZ) Exclude interest from U.S. Bonds            Enter on line 12, column I, the Social Security benefits reported on Federal Form
and Treasury Bills and notes on page 2, Schedule B, line 1.                             1040 or Form 1040A. Exclude Social Security in column II. It is not taxable.
LINE 3 - Dividends                                                                      LINE 13 - Other Income
Dividends are taxable. Report on line 3, column I the amount of dividend income         Enter on line 13, column I, the other income reported on Federal Form 1040.
from Federal Return. (Form 1040 or Form 1040A) Also report on line 3, column I          Income items included on this line would be gambling winnings, jury duty and
any Sub-Chapter S distributions. (Sub-Chapter S distributions are dividends             other miscellaneous income. Identify the source of other income on Schedule J,
subject to Muskegon Income Tax)                                                         page 2. Ordinary income from Federal Form 4972, special averaging methods, is
                                                                                        taxable, attach schedule.
Exclude margin interest paid on page 2, Schedule C, line 1.                             Exclude bingo winnings and other miscellaneous income which is not taxable in
LINE 4 - Refunds, Credits and Offsets                                                   column II. Document exclusions on Schedule J, page 2 or attach a separate
Report on line 4, column 1, the amount of taxable refunds, credits or offsets from      schedule.
Federal 1040. Exclude the amount from column I in column II as refunds, credits         LINE 14 - Adjustments and Deductions
and offsets that are not taxable by Muskegon.                                           Enter in column III the total adjustments and deductions from page 2, Schedule I,
LINE 5 - Alimony Received                                                               line 6. Attach a copy of IRA contribution receipt to support an IRA contribution
Report on line 5, column I, the amount of alimony received as reported on               adjustment. Attach a copy of Federal Form 3903 to support moving expenses
Federal 1040.                                                                           adjustment. Provide amount paid, name, address, and social security number of
                                                                                        recipient to support employee business expense adjustment. Document other
LINE 6 - Business Income                                                                adjustments and deductions on Schedule I or attach other supporting
All self employment income is taxable. Report on line 6, column I, the total            documentation or schedules. The following Federal adjustments are not allowed
business income from Federal 1040.                                                      under the Muskegon Income Tax Ordinance: student loan interest deduction,
                                                                                        Archer MSA deduction, Self-employed health insurance deduction, one-half or
Adjustments must be made for job credits, additional depreciation due to                self employment tax, and penalty on early withdrawal of savings.
investment credits and meal and entertainment expenses. (see page 2 Schedule
D)                                                                                      The City of Muskegon must approve your "Renaissance Zone Tax Exempt
                                                                                        Status" before a tax return is filed with our department. A copy of the
LINE 7 - Sale or Exchange Property                                                      Renaissance Schedule RZ 1040 must accompany the tax return.
Report on line 7, column I, the total long and short term capital gains and losses      Enter the Renaissance Zone deduction from Schedule RZ 1040. (qualified
from Federal 1040.                                                                      Renaissance Zone individuals only)
The portion of the gains and losses occurring before July 1, 1993 are excludable.       LINE 21 - Credit for Tax Paid to Another Michigan City
Use Schedule F, line 1a or if there is more than one sale or exchange, attach a
separate schedule to document exclusion. The exclusion shall be computed from           A resident may claim a credit for income tax paid to another Michigan city. The
difference between the purchase price and fair market value at July 1, 1993             credit for tax paid to the other city is based upon income that is also taxable in
(June 30 closing price for traded securities or by prorating the gain or loss on the    Muskegon. The credit allowed is the tax paid to the other city or 0.5% (.005) of
basis of total months held to months in the non-taxable period. Include gains or        the amount earned in that city during 2005 less exemptions allowed by the
losses from Federal Form 4797.                                                          Muskegon Income Tax, whichever is smaller. Proof of payment to another city
                                                                                        must be submitted. Attach a copy of the return filed with the other city. No credit
LINE 8 - IRA Distributions                                                              is allowed for tax paid to a city in another state. (Refer to worksheet on the back
Enter on line 8, column I, the IRA distributions reported on Federal Form 1040 or       of M-1040-TC).
Form 1040A.
Exclude, in column II IRA distributions qualifying as retirement benefits.
Premature IRA distributions are not excludable. ROTH rollover distributions are
excludable.


                                                                     INSTRUCTIONS PAGE 3



                                                                                   NON-RESIDENT
LINE 1 - Wages, Salaries, Tips, etc.                                                             losses from property located in Muskegon occurring prior to July 1, 1993. See instructions
Enter in column I the amount from Federal Form 1040, Form 1040A, or Form 1040EZ.                 under "Resident" for methods of prorating Muskegon gains and losses.
Enter in column II the excludable wages, salaries and tips. A non-resident is taxed on           An estate or trust is required to pay the tax for a non-resident beneficiary and such income
earnings received for work done or services performed in the City of Muskegon. The               is excludable on the Individuals Muskegon Return.
excludable portion of compensation paid to a non-resident for work performed for an              LINE 8 - IRA Distributions
employer both inside and outside of Muskegon is computed on Schedule A, lines 1a                 Enter in column I the amount from Federal Form 1040 or Form 1040A.
through 1g. The exclusion is based on the percentage of time worked in and out of
Muskegon. Vacation and sick time are not included in total days worked in arriving at            Exclude in column II all IRA distributions except premature distributions previously
this percentage. Compensation for vacations, holidays, sick time, bonuses, and                   deducted from income subject to Muskegon tax.
separation or incentive retirement payments is taxable on the same ratio as normal               LINE 9 - Pensions and Annuities
earnings. The percentage of compensation may be computed on the basis of days, hours
or dollars of commission. A separate schedule must be completed to allocate wages from           Enter on line 9, column I, the pension and annuities reported on Federal Form 1040 or
each employer.                                                                                   Form 1040A.
Attach W-2 forms showing all wages and Muskegon tax withheld.                                    Exclude in column II, annuity distributions and pension distributions qualifying as
                                                                                                 retirement benefits. Early distributions from a pension plan are not excludable if related
Use Schedule A, line 2 to explain exclusion of wages earned entirely outside of Muskegon.        compensation was subject to Muskegon tax.
Part Year Residents see Part Year Resident Instructions on page 3 and use form M-                LINE 10 - Supplemental Income
1040TC to calculate taxable income and tax due.                                                  Report in column I, the amount from Federal 1040.
LINE 2 - Interest                                                                                Exclude in column II the portion of income or loss from rental units outside the City of
NOT TAXABLE, leave blank.                                                                        Muskegon, partnerships business activity outside the city, Sub-S corporations and farming
LINE 3 - Dividends                                                                               activity outside the city. Support the exclusions by attaching a copy of Federal Schedule E
                                                                                                 and/or Schedule F. Losses on passive income are treated the same as on Federal Form
NOT TAXABLE, leave blank                                                                         1040.
LINE 4 - Refunds, Credits and Offsets                                                            LINE 11 - Unemployment Compensation
NOT TAXABLE, leave blank.                                                                        NOT TAXABLE, leave blank.
LINE 5 - Alimony Received                                                                        LINE 12 - Social Security Benefits
NOT TAXABLE, leave blank.                                                                        NOT TAXABLE, leave blank.
LINE 6 - Business Income                                                                         LINE 13 - Other Income
Report in column I the amount from Federal 1040.                                                 See instructions under "Resident". ESOP payments and stock savings plans are taxable in
See "Resident" Instructions on page 3 for adjustments to business income.                        proportion to taxable wages. Miscellaneous income for services performed outside the City
If the business activity is not entirely within the City of Muskegon, use Schedule D on page     of Muskegon is excluded. Identify and explain exclusions on Schedule J.
2 to compute the excluded Business Income. Use Schedule E to compute the Business                LINE 14 - Adjustments and Deductions
Allocation Percentage.                                                                           See instructions under "Resident".
In determining the Business Allocation Percentage, a factor shall be excluded from the           If your earnings from line 1 have been allocated through use of the percentage from
computation only when such factor does not exist anywhere. In such cases, the sum of the         Schedule A. line 1d use same percentage to allocate the related adjustments. Explain
percentages shall be divided by the number of factors actually used.                             allocations on Schedule J.
LINE 7 - Sale or Exchange of Property                                                            An IRA deduction is only allowable for individuals with Muskegon earned income to the
Report in column I the amounts from Federal 1040. Exclude on Schedule F the portion of           extent the income is subject to the Muskegon tax.
gains or losses from property located outside of Muskegon and the portion of gains or            Part Year Residents must allocate adjustments the same way they allocate income.
                                                                                  ALL TAXPAYERS
PAYMENTS AND CREDITS                                                                             ASSISTANCE
LINE 19 - Total Tax Withheld by Employers                                                        If you have any questions not answered in these instructions, or if you need assistance in
Enter total Muskegon tax withheld as shown on city or local copy W-2 forms. ATTACH               preparing your return, call (231) 724-6770 or visit the Income Tax Department, Room 105,
COPIES OF ALL W-2 FORMS and be sure the total Muskegon tax withheld agrees with                  City Hall, 933 Terrace Street, Muskegon, Michigan.
line 19. Round to the nearest dollar.                                                            NOTE: We will not prepare your return.
LINE 20 - Payments on 2005 Declaration of Estimated Tax                                          DECLARATION OF ESTIMATED TAX
Take credit for all estimated Muskegon Income Tax payments made for 2005 including last          If your 2006 Muskegon Income not subject to withholding is expected to be more than
payment due in January 2006.                                                                     $10,000 for a resident or more than $20,000 for a non-resident (after deduction of
LINE 22 - Other Tax Credits                                                                      exemption credits) on which the tax will be over $100.00, you must file a Declaration of
                                                                                                 Estimated Tax for 2006 by May 1, 2006 and pay at least one-fourth (1/4) of the estimated
Enter tax paid on your behalf by a partnership of which you are a partner, or payments           2006 tax with your Declaration.
made on a tentative return.                                                                      The balance of the estimated tax, is due in three equal installments to be paid by June 30,
TAX DUE OR REFUND                                                                                2006, October 2, 2006 and January 31, 2007. You may amend your estimate at the time
                                                                                                 of making any quarterly payment.
LINE 24 - Balance Due                                                                            Credit for a 2005 overpayment may be applied to your 2006 estimated tax. Other
Tax due of one dollar ($1.00) or more must be paid IN FULL WHEN THE RETURN IS                    overpayments are refunded by check, or donated to the D.A.R.E. Program.
FILED. Tax due of less than $1.00 need not be paid.                                              A Declaration of Estimated Tax form may be obtained by calling (231) 724-6770 or
Make check or money order payable to CITY OF MUSKEGON.                                           stopping at the Income Tax Department.
NOTE: IF YOUR PAYMENT IS OVER $100.00, YOU MAY BE REQUIRED TO FILE A                             No estimate is required if 70% of current or prior years tax is paid by withholding or
DECLARATION OF ESTIMATED INCOME TAX, FORM M-1040ES. SEE ESTIMATED                                another tax credit.
TAX INSTRUCTIONS. PENALTY AND INTEREST WILL BE CHARGED IF YOU HAVE
NOT FILED A REQUIRED ESTIMATE OR IF YOUR ESTIMATES ARE UNDERPAID.                                PENALTY AND INTEREST WILL BE CHARGED IF YOU HAVE NOT FILED A
                                                                                                 REQUIRED ESTIMATE OR IF YOUR ESTIMATES ARE UNDERPAID.
                                                                                                 CHARGES FOR LATE PAYMENTS
LINES 25, 26  and 27 - Overpayment                                                               All tax remaining unpaid at the time a return is filed or after the due date, whichever date is
Overpayment of less than one dollar ($1.00) will not be refunded and cannot be donated.          earlier, is subject to penalty and interest. The penalty is 1% per month, not to exceed a
All other overpayments will be refunded or may be donated to the D.A.R.E. Program, or            total penalty of 25%. The interest rate is 1% above the prime rate on an annual basis.
credited to the 2006 estimated tax liability. To donate the overpayment, check the donation
box on line 25 and enter the overpayment. To claim a refund enter the overpayment on             The minimum charge for penalty and/or interest is $2.00
line 26a. Complete lines 26b through 26d if you want us to directly deposit the amount           NOTE: Copies of federal schedules and/or other documentation explaining and supporting
shown on line 11a into your checking or savings account at a bank or other financial             exclusions, adjustments and deductions must be attached to the return. Failure to attach
institution (such as a mutual fund, brokerage firm, or credit union) instead of sending you a    schedules and documentation or attaching incomplete or incorrect schedules and
check. NOTE: If you do not want your refund directly deposited into your account, leave          documentation, will delay processing of the return or result in deductions being disallowed.
lines 26b through 26d blank. Enter the overpayment on line 27 if you want it credited to
your 2006 estimated tax liability.
Refunds will be made as quickly as possible. Please allow 45 days before making an
inquiry.



                                                                            INSTRUCTIONS PAGE 4



                                                                                                                                                                 2005 MUSKEGON M-1040                                                                                                      PAGE 1
                                                                                                                                                 INDIVIDUAL INCOME TAX RETURN - DUE DATE MAY 1, 2006

                                                                                               YOUR FIRST NAME AND MIDDLE INITIAL                        LAST NAME                                               YOUR OCCUPATION                            YOUR SOCIAL SECURITY NUMBER


                TYPE IF JOINT, SPOUSE'S FIRST NAME AND MIDDLE INITIAL LAST NAME                                                                                                                                  SPOUSE'S OCCUPATION                        YOUR SPOUSE'S SOCIAL SECURITY NUMBER

                                                                          OR                   HOME ADDRESS (NUMBER AND STREET OR RURAL ROUTE)                                                                   YOUR PHONE NUMBER                              CHECK BOX IF FIRST MUSKEGON
PRINT                                                                                                                                                                                                                                                           RETURN
                                                                                               CITY, TOWN, OR POST OFFICE                                                         STATE                          ZIP CODE                                       CHECK BOX IF NAME OR ADDRESS
                                                                                                                                                                                                                                                                CHANGED SINCE FILING YOUR LAST
                                                                                                                                                                                                                                                                MUSKEGON RETURN
PRESENT EMPLOYER                                                                                                                                                                                  IF MARRIED AND FILING SEPARATE RETURN:                        CHECK BOX IF YOU DO NOT NEED A
                                                                                                                                                                                                                                                                RETURN FORM MAILED TO YOU NEXT YEAR
                                                                                                                                                                                                  SPOUSE'S NAME                                             RESIDENCY STATUS
SPOUSE'S PRESENT EMPLOYER                                                                                                                                                                                                                                       RESIDENT
                                                                                                                                                                                                  SPOUSE'S SS#                                                  PART YEAR RESIDENT (SEE INSTRUCTIONS
                                                                                                                                                                                                                                                                PAGE 3 AND ATTACH FORM M-1040TC
EXEMPTIONS                                                                                                                                                                                 PARAPLEGIC, QUADRIPLEGIC, HEMIPLEGIC
                                                                                                                 REGULAR         65 AND OVER        BLIND                DEAF              OR TOTALLY AND PERMANENTLY DISABLED                                  NON-RESIDENT
                                                                        YOURSELF                                                                                                                                                                            NUMBER OF OTHER DEPENDENTS (EXPLAIN)

                                                                        SPOUSE
FIRST NAMES OF DEPENDENT CHILDREN WHO LIVED WITH YOU                                                                                                                                                                                                        TOTAL EXEMPTIONS CLAIMED
                                                                                                                                                                                                                                                            (ENTER ALSO ON LINE 16)
                                                                                                                       IF THERE ARE NO EXCLUSIONS IN COLUMN II BELOW, COMPLETE COLUMN III ONLY
                                                                                        INCOME                                                                                              COLUMN I                         COLUMN II                                       COLUMN III
                                                                                                                   ATTACH SCHEDULES TO SUPPORT                                           FROM FEDERAL                        EXCLUSIONS             PAGE 2                TAXABLE INCOME
                                                                                                                   FIGURES ON LINES 6 THROUGH 14                                             RETURN                       (FROM PAGE 2)              SCH.                 (COL I LESS COL II)
                                                                                        1. Total wages, salaries and tips.
                E                                                                                                                                                                                           00                                00      A                                          00
                     R                                                                  2. Interest (not taxable to non-residents)
                          E                                                                                                                                                                                 00                                00      B                                          00
                               H                                                        3. Dividends (not taxable to non-residents)                                                                         00                                00      C                                          00
                                    2-                                                  4. Refunds, credits or offsets of state or local income taxes                                                       00                                00 NOT TAXABLE              NOT TAXABLE            00
                                          WF 5. Alimonyreceived                                                                                                                                             00                                00                                                 00
                                          O                                             6. Business income (attach Fed Sch C)                                                                               00                                00      D                                          00
                                               SEI 7.Sale or exchange of property(attach Fed Sch D and/or Form 4797)                                                                                        00                                00      F                                          00
                                               P                                        8. IRA distributions
                                                    O                                                                                                                                                       00                                00      G                                          00                                                                                P
                                                         C                              9. Pensions and annuities                                                                                           00                                00      G                                          00              EL
 H                                                                                                                                                                                                                                                                                                                     A
      C                                                                                 10. Supplemental income (attach Fed Sch E and/or Sch F)                                                             00                                00      H                                          00    S
                                                              A                                                                                                                                                                                                                                                                                                                         E
                                                                   T                    11. Unemployment compensation                                                                                       00                                00 NOT TAXABLE              NOT TAXABLE            00                         R
           TA 12. Social Security                                                                                                                                                                                                                                                                           O
                                                                                                                                                                                                            00                                00 NOT TAXABLE              NOT TAXABLE            00                                          U
                                                                                        13. Miscellaneous income (attach schedule or explanation)                                                           00                                00      J                                          00                                               ND
                                                                                        14. Adjustments and deductions (attach schedule or related federal schedule)                                                                                   I                                         00                              TO
                                                                                        15. Total income (lines 1 through 14)                                                                               00                                00                                                 00
                                                                                        16. Less exemption credit (no. of exemptions above ________ x $600.00)                                                                                                                                   00                                                     HTE
                                                                                        17. Taxable income (subtract line 16 from line 15)                                                                                                                                                       00                                                                                          N
                                                                                        18. Tax (multiply line 17 by 1% (.01) for residents or ½% (.005) for non-residents or check this box             and attach Form M-1040TC                                                                                                                              E
                                                                                                                                                                                                                                                                                                 00                                                                 A
                                                                                        PAYMENTS AND CREDITS                                                                                                                                                                                                                                                                                      RE
                                                                                        19. Total Muskegon tax withheld by employers (attach W-2 forms showing Muskegon tax withheld)                                                                                                            00                                                                      ST
                                                                        R E 20. Payments on 2005 Declaration of Muskegon Estimated Income Tax                                                                                                                                                    00                                                                      D
           O RE                                                                                                                                                                                                                                                                                                                  O
                                                                                        21. Credit for income tax paid to another Michigan city. (RESIDENTS ONLY) attach copy of other city's return) Use City Credit Work Sheet.
           K H                                                                                                                                                                                                                                                                                   00
                                                                        C R 22. Other tax credits (attach explanation)                                                                                                                                                                           00                                   ALL
           E E                                                                                                                                                                                                                                                                                                                                                                R
           H                                                                            23. Total payments and credits (add lines 19 through 22)                                                                                                                                                 00
                                                                        C DR
                H O TAX DUE OR REFUND
                                                                        CA Y 24. If line 18is larger than line 23, enter TAX DUE. If $1.00 or more, PAY THIS AMOUNT with return. (If over $100.00 see page 4)
                T E
                                                                        T N 25. If line 23 is larger than 18, check this box                  to DONATE your refund to the D.A.R.E. Program.
                A OM                                                                                                 Please see sample on the back page of the M-1040TC
                                                                                        26.    a. If line 23 is larger than line 18, enter overpayment to be REFUNDED. Allow at least 45 days.

                                                                                               b. Routing number:                                                 c. Type:         Checking           Savings

                                                                                               d. Account number:
                                                                                        27. To credit this refund to the 2006 estimated tax liability, check this box                                                                                                                            00
Under the penalties of perjury, I declare that I have examined this return, including accompanying schedules, and to the best of my knowledge and belief it is true, correct and complete.
                                                                          I (we) authorize the Income Tax Department to discuss this return and attachments with the preparer.
Mail return to: Income Tax Department, P.O. Box 29, Muskegon, MI 49443-0029. Make checks payable to City of Muskegon

                                                                           ER                             IF FILING JOINTLY, BOTH MUST SIGN                                FIRM'S NAME AND SIGNATURE OF PREPARER OTHER THAN TAXPAYER
                                                                                 EH                             EVEN IF ONLY ONE HAD INCOME.                               (This return is based on all information of which I am knowledgable.
                                                                                 NR YOUR SIGNATURE                                      DATE                             SIGNATURE                                                 PHONE
                                                                                 UTERN SPOUSE'S SIGNATURE                               DATE                             ADDRESS OF PREPARER                                       DATE
                                                                                 GIS                                                                                                                                                                                 Machine Certification



                               ALL TOTALS FROM THIS BACK (EXCEPT SCHEDULE E) CARRY OVER TO PAGE 1
SCHEDULE A - EXCLUDABLE WAGES, ETC.                                                                 List each such employer and schedule each separately
1. NON-RESIDENT wages, etc., earned partly outside Muskegon:                            EMPLOYER
   a. Actual number of days (hours) worked everywhere 2005 (exclude vacation and sick days)                           DAYS                 DAYS                    DAYS                   DAYS
   b. Actual number of days (hours) worked in Muskegon in 2005                                                         OR                    OR                     OR                     OR
   c. Days (hours) worked outside Muskegon in 2005 (Subtract line b from line a)                                     HOURS                HOURS                   HOURS             HOURS
   d. Percentage of days (hours worked outside Muskegon (line c divided by line a)                                     %                     %                      %                      %
   e. Wages earned from this job (from W-2)                                                                            00                   00                      00                    00
   f. Non-taxable wages, etc., earned outside Muskegon (line e multiplied by line d)                                   00                   00                      00                    00
   g. Total of amounts in column on line 1f                                                                                                                                               00
2. NON-RESIDENT wages, etc., earned entirely outside Muskegon, but included in INCOME, line 1, col. I (DO NOT include line 1e                                                             00
3. a. Military pay                         00           b. S.U.B. pay                       00 c. Total of 3a and 3b (BOTH RESIDENTS AND NON-RESIDENTS                                    00
4. TOTAL EXCLUDABLE WAGES (add lines 1g, 2 and 3c) enter here and on page 1, line 1, column II                                                                                            00
SCHEDULE B - INTEREST EXCLUSIONS                                                                     SCHEDULE C - DIVIDEND EXCLUSIONS
1. RESIDENT: Interest on federal, state or city obligations                                     00 1. RESIDENT: Margin interest                                                           00
2. NON-RESIDENT Total interest on Page 1, line 2, col. I                                        00 2. NON-RESIDENT Total dividends                                                        00
SCHEDULE D - BUSINESS INCOME EXCLUSIONS
1. Income for taxable period (page face, line 6, col. I)                                                                                                                                  00
2. a. Job credit                     00            b. Additional depreciation due to investment credit adjustment                   00
  c. Meal and entertainment expenses adjustment                            00                                                             Total of lines 2a, 2b and 2c                    00
3. Total line 1 less line 2                                                                                                                                                               00
4. Allocation percentage: RESIDENTS: enter 100%  NON-RESIDENTS: if all business was conducted in Muskegon enter 100%, other-
wise enter the percentage from Schedule E, line 5, below                                                                                                            %
5. Allocated income (multiply line 3 by % on line 4)                                                                                                                                      00
6. TOTAL EXCLUDABLE BUSINESS INCOME (line 1 less than line 5) enter here and on page 1, line 6 column II                                                                                  00
                                                                                                                               COLUMN I              COLUMN II
SCHEDULE E - BUSINESS ALLOCATION PERCENTAGE                                                                                    LOCATED               LOCATED IN             COLUMN III
(TO BE USED BY NON-RESIDENTS ONLY)                                                                                            EVERYWHERE             MUSKEGON              PERCENTAGE
                                                                                                                                                                            (COLUMN II
1. a. Average net book value of real and personal property                                                                                                                  DIVIDED BY
   b. Gross rents paid on real property multiplied by 8                                                                                                                     COLUMN I)
   c. TOTALS (Add lines 1a and 1b)                                                                                                                                                         %
2. Total wages, salaries and other compensation of all employees                                                                                                                           %
3. Gross receipts from sales made or services rendered                                                                                                                                     %
4. Total percentages (add lines 1c, 2 and 3)                                                                                                                                               %
5. Business allocation percentage (divide line 4 by number of factors used) enter here and on Schedule D, line 4 above                                                                     %
SCHEDULE F - SALE OR EXCHANGE OF PROPERTY EXCLUSIONS (SCH. D - FED 1040 AND FED 4797)
1. Attach schedule computing the excludable gain or loss on lines 1a or 1b as follows: description, date acquired, date sold, gain or loss, excludable portion                            00
1. a. RESIDENT: Portion of gain or loss which occurred prior to July 1, 1993                                                                                                              00
1. b. NON-RESIDENT: Portion of gain or loss on sale of property located in Muskegon which occurred prior to July 1, 1993                                                                  00
2. NON-RESIDENT: Gains or losses from sale of property outside of Muskegon                                                                                                                00
3. TOTAL EXCLUDABLE SALES OR EXCHANGES OF PROPERTY (add lines 1a, 1b and 2) enter here and on page 1, line 7 col. II                                                                      00
SCHEDULE G - IRA AND PENSION EXCLUSIONS
1. IRA Distributions (early distributions are not excludable) enter here and on page 1, line 8, column II                                                                                 00
2. Pensions and annuities: enter here and page 1, line 9, column II                                                                                                                       00
SCHEDULE H - SUPPLEMENTAL INCOME EXCLUSIONS (SCH E AND SCH F  - FED 1040)
1. RENTS (excludable by NON-RESIDENTS only on property located outside of Muskegon)                 Location:                                                                             00
2. PARTNERSHIPS (NON-RESIDENTS only on partnerships located outside of Muskegon)                    Location:                                                                             00
3. OTHER (identify)                                                                                                                                                                       00
4. TOTAL EXCLUDABLE SUPPLEMENTAL INCOME (add lines 1, 2, 3 and 4) enter here and on page 1, line 10, column III                                                                           00
SCHEDULE I - ADJUSTMENTS AND DEDUCTIONS ALLOWED (attach a copy of face page, Federal 1040)
1. IRA, KEOGH, and self-employed SEP contributions (include only portion related to Muskegon taxable income)                                                                              00
2. Moving expenses (include only portion related to Muskegon taxable income) (attach Federal Schedule 3903)                                                                               00
3. Alimony paid, list recipient's name and SSN:                                               (include only portion related to Muskegon taxable income)                                   00
4. Employee business expenses (see instructions for which expenses are deductible) (attach Federal Schedule 2106)                                                                         00
5. Other deductions                                                                                                                                                                       00
6. TOTAL ADJUSTMENTS AND DEDUCTIONS (add lines 1, 2, 3, 4 and 5) enter here and on page 1, line 14 column III                                                                             00
SCHEDULE J - (Use to list employers who did not withhold, explain special tax computation, make explanations not shown elsewhere or in lieu of schedule)





              IF ADDITIONAL SPACE IS NEEDED, SHOW INFORMATION ON A SEPARATE SHEET (EXPLAIN IN FULL)
                                                                                          PAGE 2



                                                                     2005 MUSKEGON M-1040EZ
                                                           INDIVIDUAL INCOME TAX RETURN ­ DUE DATE MAY 1, 2006
                                                             REFER TO INSTRUCTIONS ON BACK TO SEE WHO CAN USE THIS FORM
                       YOUR FIRST NAME AND MIDDLE INITIAL                              LAST NAME                                            YOUR SOCIAL SECURITY NUMBER

   USE THE
 MUSKEGON IF JOINT, SPOUSE'S FIRST NAME AND MIDDLE INITIAL                             LAST NAME                                            YOUR SPOUSE'S SOCIAL SECURITY NUMBER
    MAILING
     LABEL
 OTHERWISE HOME ADDRESS (NUMBER AND STREET OR RURAL ROUTE)                                                                                  YOUR PHONE NUMBER
    PLEASE
     PRINT             CITY, TOWN, OR POST OFFICE                                                                  STATE                                          ZIP CODE


       SEE                  Check box if this is                                                                RESIDENCY STATUS                        MARRIED FILING SEPARATELY
                                                           Check box if your             Check box if you
INSTRUCTIONS                the first time you             address has                   do not need a                 RESIDENT                         SPOUSE'S NAME
   ON BACK                  filed a Muskegon               changed since filing          return form mailed
                            return.                        your 2003 return.             to you next year.             NON-RESIDENT SSN
                  1. Total wages, salaries, and tips. (See instructions on back.)
                         RESIDENTS: Total from Box 1 of all your W-2 forms.
                         NON-RESIDENTS: Total from Box 1 of the W-2 forms for work done in the City of Muskegon. Attach                          1.                ,                 . 0 0
   INCOME                your W-2 form(s).
                  2. Interest income. (See instructions on back.)
                         RESIDENTS: Report all taxable interest income.                                                                          2.
    ATTACH                                                                                                                                                                                0 0
                         NON-RESIDENTS: Leave blank.                                                                                                               ,                 .
    COPY 2
   OF YOUR        3. Dividend income. (See instructions on back.)
                         RESIDENTS: Report all dividend income.                                                                                  3.
 W-2 FORM(S)                                                                                                                                                                              0 0
                         NON-RESIDENTS: Leave blank.                                                                                                               ,                 .
     HERE         4. Add lines 1, 2 and 3. This is your total Muskegon income.                                                                   4.                ,                 . 0 0

 EXEMPTION 5. Enter amount from Exemptions Worksheet on back; or if SINGLE enter $600.00; or if
                         MARRIED filing jointly enter $1,200.00.                                                                                 5.
  AMOUNT                                                                                                                                                           ,                 . 0 0       P
  TAXABLE         6.                                                                                                                                                                                              EL
                         Subtract line 5 from line 4. This is your taxable income.                                                               6.
   INCOME                                                                                                                                                                                 0 0                                                             A
                                                                                                                                                                   ,                 .                            SE
                  7.                                                                                                                                                                                              R
      TAX                RESIDENTS: Multiply line 6 by one percent (.01).                                                                                                                                              O
                         NON-RESIDENTS: Multiply line 6 by one-half of one percent (.005).                                                       7.                ,                 . 0 0                                                                     UN
                  8.                                                                                                                                                                                                        D
                         Total Muskegon tax withheld by employers (attach W-2 forms showing Muskegon withheld)                                   8.                                                                              T
                                                                                                                                                                                          0 0                                                                                          O
                                                                                                                                                                   ,                 .
 PAYMENTS 9.                                                                                                                                                                                                                                                         HTE
     AND                 Payments on 2005 Declaration of Muskegon Estimated Income Tax.                                                          9.                                       0 0                                         N
  CREDITS                                                                                                                                                          ,                 .                                                                                      E
                  10.                                                                                                                                                                                                                      A
                         Credit for income tax paid to another Michigan city (RESIDENTS ONLY).                                                                                                                                                                                   RE
                         (Attach copy of other city's return.) USE CITY CREDIT WORKSHEET.                                                        10.                                      0 0                                                   S
                                                                                                                                                                   ,                 .                T
                  11.                                                                                                                                                                                      DO
    TOTAL                Add lines 8. 9 and 10 and enter here.                                                                                   11.               ,                 . 0 0                 ALL
                  12. If line 7 is larger than line 11, subtract line 11 from line 7. This is the amount you owe. Please attach your                                                                                                                 R
  TAX DUE                payment. Make check payable to: City of Muskegon. If payment due is greater than $100.00, you may be 12.                                                         0 0
                         assessed additional penalties and interest if you were required to pay estimated taxes.                                                   ,                 .
                                                    Please see sample on the back page of the M-1040TC
                  13. a. If line 11 is larger than line 7, subtract line 7 from line 11. This is your refund. Allow at least 45 days.
                         b. Routing number:
                         c. Type:      Checking         Savings
  REFUNDS                                                                                                                                        13.                                      0 0
     AND                 d. Account number:                                                                                                                        ,                 .
  CREDITS         14.          Check this box to DONATE your refund to the D.A.R.E. Program.                                                     14.               ,                 . 0 0
                  15.
                               Check this box to credit this refund to the 2006 estimated tax liability.                                         15.               ,                 . 0 0
I have read this return. Under the penalties of perjury, I declare that to the best of my knowledge and belief the return                                      For City of Muskegon use.
is true, correct and accurately lists all amounts and sources of Muskegon income I received during the tax year.                                               Please do not write in box.
Mail return to: Income Tax Department, P.O. Box 29, Muskegon, MI 49443-0029.
PLEASE SIGN HERE YOUR SIGNATURE                                        DATE           SPOUSE'S SIGNATURE (IF JOINT RETURN)               DATE
KEEP A COPY OF THIS
FOR YOUR RECORDS.                                                                                                                                                 Machine Certification



                                           2005 INSTRUCTIONS FOR FORM M-1040EZ
WHO CAN          USE THIS FORM IF:
                 You were a resident of Muskegon for all of 2005 with income from wages, interest or dividends with none of the income being excludable from
USE THIS         Muskegon income tax and the tax payments are Muskegon tax withheld, estimated tax payments and credit for income tax paid to another
FORM             Michigan city; or
                 You were a non-resident of Muskegon for all of 2005 with wages earned in Muskegon and none of the earnings from Muskegon employers is
                 excludable from Muskegon income tax.
                 YOU CANNOT USE THIS FORM IF:
                 You received alimony payments, had Muskegon business income (Sch C), sold or exchanged property (Sch D or 4797), had taxable IRA
                 distributions, taxable pension/annuity distributions, supplemental income (Sch E or F), miscellaneous income, exclusions or adjustments.

YOUR             Because this form is designed to be read by a machine, please print your numbers inside the boxes like this:
RETURN
                                                                       Do not type your numbers. Do not use dollar signs.
                            1 2 , 3 4 5 . 0 0
                 NAME AND SOCIAL SECURITY NUMBER
                 Fill in your first name, middle initial, last name and social security number. If a joint return, also fill in your spouse's first name, middle initial, last
                 name and social security number.
                 FIRST RETURN
                 Check the first return box if this is the first time you filed a Muskegon income tax return.
                 ADDRESS CHANGE
                 Check the address change box if your address had changed since filing your 2004 Muskegon income tax return.
                 RESIDENCY STATUS
                 Check the resident or non-resident box under Residency Status. A part year resident of Muskegon cannot use this form.
                 MARRIED FILING SEPARATELY
                 If married and filing separately, enter spouse's name and social security number in Married Filing Separately box.

INCOME           If you have income on your federal income tax return that is not taxable by Muskegon, use Form M-1040.
                 LINE 1. TOTAL WAGES, SALARIES AND TIPS
                      Residents and non-residents enter the amount of wages reported on your Federal Return.
                 LINE 2. INTEREST INCOME
                      Residents enter the amount of taxable interest income reported on your Federal Return.
                      Non-residents enter zero. Interest income is not taxable to a non-resident.
                 LINE 3. DIVIDEND INCOME
                      Residents enter the amount of dividend income reported on your Federal Return.
                      Non-residents enter zero. Dividend income is not taxable to a non-resident.
                 LINE 4. TOTAL MUSKEGON INCOME
                      Enter the total of lines 1, 2 and 3.
PAYMENTS AND     LINE 9.
CREDITS               Residents and non-residents enter the total estimated income tax paid during 2005 including the amount paid with voucher 4 due January
                      31, 2006.
                 LINE 10.
                      Residents may take credit for income tax paid to another Michigan city. The credit is limited to the Muskegon non-resident rate of 0.5%
                      (.005) and the Muskegon exemption of $600.00 per person. (Refer to Worksheet on the back of M-1040TC)
TAX DUE          LINE 12.
                      Tax due of one dollar ($1.00) or more must be paid in full when the return is filed. Make check or money order payable to: the City of
                      Muskegon. If your payment is over $100.00. You may be assessed additional penalties and interest, if you are required to file estimated tax
                      vouchers.
OVERPAYMENTS LINE 13, 14, and 15. OVERPAYMENTS
                      Overpayments of less than one dollar ($1.00) will not be refunded and cannot be donated. All other overpayments will be refunded or may
                      be donated to the D.A.R.E. Program, or Credited to the 2006 estimated tax liability. To donate the overpayment, check the donation box on
                      line 14 and enter the overpayment. To claim a refund, enter the overpayment on line 13a. Complete lines 13b through 13d if you want us to
                      directly deposit the amount shown on line 11a into your checking or savings account at a bank or other financial institution (such as a mutual
                      fund, brokerage firm, or credit union) instead of sending you a check. NOTE: If you do not want your refund directly deposited into your
                      account, leave lines 13b through 13d balnk. Enter the overpayment on line 15 if you want it credited to your 2005 estimated tax liability.

EXEMPTION        LINE 5. EXEMPTION AMOUNT
                      Complete worksheet below and enter the total from box 5a on page 1, line 5.
AMOUNT
                                                                            EXEMPTIONS WORKSHEET
                 1. CHECK BOXES THAT APPLY                                                                                                             1A. NUMBER OF
                                                           REGULAR    65 AND OVER    BLIND      DEAF         PARAPLEGIC, QUADRIPLEGIC, HEMIPLEGIC      BOXES CHECKED
                                                                                                                 OR TOTALLY AND PERMANENTLY
                                      YOURSELF                                                                   DISABLED
                                      SPOUSE
                 2. LIST FIRST NAMES OF DEPENDENT CHILDREN WHO LIVED WITH YOU                                                                          2A. NUMBER OF
                                                                                                                                                       CHILDREN LISTED

                 3. OTHER DEPENDENTS (LIST AND EXPLAIN)                                                                                                3A. NUMBER OF OTHER
                                                                                                                                                       DEPENDENTS

                 4. TOTAL NUMBER OF DEPENDENCY EXEMPTIONS (ADD BOXES 1A, 2A AND 3A. AND ENTER THE TOTAL IN BOX 4A.                                     4A. TOTAL NUMBER
                                                                                                                                                       OF EXEMPTIONS

                 5. MULTIPLY TOTAL NUMBER OF EXEMPTIONS IN BOX 4A BY $600.00 AND ENTER THE TOTAL IN BOX 5A AND ON PAGE 1, LINE 5.                      5A. EXEMPTION
                                                                                                                                                       AMOUNT

                 LINES 6 THROUGH 15
                      Follow the instructions on the front of this form for each separate line.
                                                                          Thank You



                                                    2005 MUSKEGON M-1040TC
                                                                   TAX CALCULATIONS SCHEDULE
                                                             FOR USE BY PART YEAR RESIDENTS
TAXPAYER'S NAME                                                                                     SOCIAL SECURITY NUMBER


                                         NUMBER OF MONTHS                    FROM                                    TO
          2005 MUSKEGON RESIDENCY

FORMER ADDRESS



                                                                                CATEGORIES OF INCOME
                   COLUMN 1                  COLUMN 2                COLUMN 3             COLUMN 4              COLUMN 5               COLUMN 6
                                             TOTAL INCOME          EXCLUDABLE INCOME    MUSKEGON INCOME                               TOTAL INCOME
            SOURCES OF INCOME              ADJUSTMENTS OR             ADJUSTMENTS         EARNED AS A          INCOME EARNED          SUBJECT TO TAX
                                              DEDUCTIONS            AND DEDUCTIONS        NON-RESIDENT         AS A RESIDENT           (COL. 4 + COL. 5)

1a.                                                          00                  00                      00                     00                          00

1b.                                                          00                  00                      00                     00                          00

1c.                                                          00                  00                      00                     00                          00

1d.                                                          00                  00                      00                     00                          00 PLEA
1e.                                                          00                  00                      00                     00                          00 SERO
1f.                                                          00                  00                      00                     00                          00 UND
1g.                                                          00                  00                      00                     00                          00 OT
                                                                                                                                                                       HT
1h.                                                          00                  00                      00                     00                          00 ENEA
1i.                                                          00                  00                      00                     00                          00 REST
1j.                                                          00                  00                      00                     00                          00 DOL
2. TOTALS                                                    00                  00                      00                     00                          00 ALR
3. PERCENTAGE OF TOTAL MUSKEGON INCOME                                                                                                    100%

4. RENAISSANCE ZONE DEDUCTION

5. EXEMPTION AMOUNT

6. TAXABLE INCOME                                                                                        00                     00                          00

7. TAX RATES (0.5% = .005 AND 1% = .01)                                                     0.5%                    1%

8. TAX                                                                                                   00                     00                          00

INSTRUCTIONS FOR M-1040TC, TAX CALCULATION SCHEDULE

LINE 1 . List each source of income (i.e, employer, Schedule C, interest, etc.) or deduction in column 1 and the total income or deduction from
          the item in column 2. Split the income or deduction between the different categories of income (columns 3, 4, and 5) based upon the
          time in each status and enter the income subject to tax in column 6.
LINE 2 . Total column 2, column 3, column 4, column 5 and column 6 and enter the amounts.
LINE 3 . Compute and enter in column 4 and column 5 the percentage of total income subject to tax by dividing the amount on line 2 of the
          column by the total income subject to tax (line 2 divided by column 6).
LINE 4 . Qualified Renaissance Zone Individuals Only Enter amount from line 11 of Schedule RZ M-1040.
LINE 5 . Enter in column 6 the total exemption credit from Form M-1040, line 16 and compute the exemption credit for column 4 and column 5
          based upon the percentages on line 3 of the respective column.
LINE 6 . Subtract line 4 and 5 from line 2 and enter the difference.
LINE 8 . Multiply line 6 of column 4 and column 5 by the tax rate for the column from line 7 and enter the amount. Add the amounts in column 4
          and column 5 and enter the total in column 6.

Enter the total from column 6, line 8 on Form M-1040, line 18.
                                 ATTACH A COPY OF THE M-1040TC TO YOUR INCOME TAX RETURN



                                                     DIRECT DEPOSIT
Fast Refunds! ­ Choose direct deposit - a fast and secure way to have your refund
deposited automatically into your checking or savings account.

Helpful Tips
Please check with your financial institution to make sure your direct deposit will be accepted and make 
sure you have the correct routing and account numbers. The City of Muskegon is not responsible for a lost refund if you enter the 
wrong account information.

Some financial institutions will not allow a joint refund to be deposited into an individual account. If the direct deposit is rejected, a 
check will be sent instead. The Cit of Muskegon is not responsible if a financial institution rejects a direct deposit.

The account number can be up to 17 characters (both number and letters). Include hyphens but omit spaces and special symbols. 
Enter the number for left to right and leave any unused boxes blank. See sample below. Do not include the check number.

                           JEFFREY MAPLE                                                                              1234
                           SUZANNE MAPLE
                           123 Main Ave.                                                                       15-0000/0000
                           Anyplace, MI 20000

                           PAY TO THE
                           ORDER OF                                 SAMPLE                            $
                                                  Routing No.           Account No.                        DOLLARS
                                                 M-1040 line 26b       M-1040 line 26d
                           ANYPLACE BANK M-1040EZ line 13b            M-1040EZ line 13d               Do not include
                           Anyplace, VA 20000                                                    the check number.
                           For
                             250250025  202020 86    1234

                             DIRECT DEPOSIT SAMPLE                                 The routing and account numbers may
                                                                            !
                      a. Routing number 2 5 0 2 5 0 0 2 5                 CAUTION be in different places on your check.
                      b. Type:   X Checking      Savings
                      c. Account Number 2 0 2 0 2 0 8 6

                                                          CITY CREDIT WORKSHEET
                                         CREDIT FOR TAX PAID TO ANOTHER MICHIGAN CITY

A resident shall be allowed a credit against the city income tax for the amount paid to the other municipality.  The credit for tax paid 
to the other city is based upon income that is also taxable in Muskegon.  The credit shall not exceed the amount of taxes which 
would be assessed under the City of Muskegon Income Ordinance on the same amount of income of a nonresident (.005).  The 
credit allowed is the tax paid to the other city or 0.5% (.005) of the amount earned in that city during 2004, less exemptions allowed 
by the Muskegon Income Tax, whichever is smaller.  Proof of payment to another city must be submitted.  Attach a copy of the 
return filed with the other city.  No credit is allowed for tax paid to another city in another state.

A Muskegon resident working in Grand Rapids, which has a non-resident tax rate of 0.65% .0065, is  only allowed a credit of 0.5% 
.005  on their Muskegon tax return.  This is the maximum amount of credit that the ordinance allows for a resident working in 
another city with an income tax.

Part year residents:

Include income on line 1 of this worksheet only to the extent that is taxable by Muskegon as a resident and taxable by another city 
that imposes an income tax as a non-resident.


      1. Enter the income earned in another Michigan city that has a local tax.                 1.                             .00
      2. Less: exemption amount from the Muskegon return.                                       2.                             .00
        Number of exemptions ________ x $600.00
      3. Subtract line 2 from line 1.                                                           3.                             .00
      4. Rate.                                                                                  4.                             .005
      5. Multiply line 3 by line 4.  Enter here and on M-1040 line 21 or M-1040EZ line 10.
                                                                                                5.                             .00

    NOTE:
    You must complete a separate City Credit Worksheet for each city in which you file a non-resident return.

       YOU MUST ATTACH A COPY OF PAGE ONE OF THE OTHER CITY'S RETURN.



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