2007 Individual Income Tax Forms by uvk48604

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									 General Information - Homestead Property Tax Credit (MI-1040CR)
The request for your Social Security       income limitation applies. See             maintaining a household. It is your
number is authorized under USC             instructions for annualizing on page 22.   AGI, plus all income exempt or
Section 42. Social Security numbers are                                               excluded from AGI. Include gains
used by Treasury to conduct matches        Which Form to File                         realized on the sale of your residence
against benefit income provided by the     Most filers should use Form                regardless of your age or whether or
Social Security Administration and         MI-1040CR in this book.                    not these gains are exempt from federal
other sources to verify the accuracy of    If you are blind and own your              income tax.        (See instructions
the home heating credit and property                                                  beginning on page 20.)
                                           homestead, are in the active military,
tax credit claims filed and to deter       are an eligible veteran or an eligible     Household income does NOT
fraudulent filing(s).                                                                 include:
                                           veteran’s surviving spouse, request
                                           Form MI-1040CR-2 and complete an           • Payments received by participants
Who May Claim a Property Tax
                                           MI-1040CR and an MI-1040CR-2. Use          in the foster grandparent or senior
Credit
                                           the form that gives you a larger           companion program
You may claim a property tax credit if     credit. If you are blind and rent your     • Energy assistance grants
all of the following apply:                homestead, you cannot use the              • Government payments to a third
• Your homestead is located in             MI-1040CR-2. Claim your credit on          party (e.g., a doctor)
Michigan.                                  Form MI-1040CR and check the
                                           appropriate box on line 5.                 Note: If payment is made from money
• You were a Michigan resident at least                                               withheld from your benefit, the
six months of 2006.                        When to File                               payment is part of household income.
• You pay property taxes or rent on                                                   (For example, the DHS may pay your
                                           If you are not required to file a Form
your Michigan homestead.                                                              rent directly to the landlord.)
                                           MI-1040, you may file your credit
You can have only one homestead at         claim as soon as you know your 2006        • Money received from a government
a time, and you must be the occupant       household income and property taxes        unit to repair or improve your
as well as the owner or renter. Your       levied in 2006. If you file a Michigan     homestead
homestead can be a rented apartment or     income tax return, your credit claim       • Surplus food or food stamps
a mobile home on a lot in a mobile         should be attached to your MI-1040         • State and city income tax refunds
home park. A vacation home or income       return and filed by April 17, 2007, to     and homestead property tax credits
property is not considered your            be considered timely. To avoid penalty     • Chore service payments (these
homestead.                                 and interest, if you owe tax, postmark     payments are income to the provider of
Your homestead is in your state of         no later than April 17, 2007. The filing   the service)
domicile. Domicile is the place where      deadline to receive a 2006 property tax    • The first $300 from gambling,
you have your permanent home. It is        credit is April 15, 2011.                  bingo, lottery, awards or prizes
the place you plan to return to                                                       • The first $300 in gifts, cash or
whenever you go away. Even if you          Amending Your Credit Claim
                                                                                      expenses paid on your behalf by a
spend the winter in a southern state,      File a new claim form and write            family member or friend
your domicile is still Michigan. College   “Amended” across the top of the form.
                                                                                      • Amounts deducted from Social
students and others whose permanent        You must do this within four years of
                                                                                      Security or Railroad Retirement
homes are not in Michigan are not          the date set for filing your original
                                                                                      benefits for Medicare premiums
Michigan residents.           Domicile     income tax return.
continues until you establish a new                                                   • Life, health and accident insurance
permanent home.                            Delaying Payment of Your                   premiums paid by your employer.
                                           Property Taxes                             However, if you pay medical insurance
Property tax credit claims may not be
                                                                                      or Health Maintenance Organization
submitted on behalf of minor children.     Senior citizens, disabled people,
                                                                                      (HMO) premiums for you or your
You may not claim a property tax           veterans, surviving spouses of veterans
                                                                                      family, you may deduct the cost from
credit if your household income is         and farmers may be able to delay
                                                                                      household income.
over $82,650. The computed credit is       paying property taxes. Contact your
                                           local or county treasurer for more         • Loan proceeds
reduced by 10 percent for every $1,000
(or part of $1,000) that household         information.                               • Inheritance from a spouse
income exceeds $73,650. If filing a                                                   • Life insurance benefits from a
                                           Household Income                           spouse.
part-year return, you must annualize
household income to determine if the       Household income is the total income
                                           (taxable and nontaxable) of both
                                           spouses or of a single person
                                                                                                                          17
                                             First, subtract 20 percent of the rent      Homestead property tax credits are not
Property Taxes That Can                      collected from the tax claimed for          included in household income. If you
Be Claimed for Credit                        credit. Second, reduce the tax claimed      included this amount in your taxable
Ad valorem property taxes that were          for credit by the amount of tax claimed     farm income, subtract it from
levied on your homestead in 2006,            as rental expense on your U.S. 1040.        household income.
including collection fees up to 1            For example, your home has an upstairs
percent of the taxes, can be claimed no                                                  Rent That Can Be Claimed for
                                             apartment that is rented to a tenant for
matter when you pay them. You must                                                       Credit
                                             $395 a month. Total property taxes on
deduct from your 2006 property taxes         your home are $2,150. Of this amount,       You must be under a lease or rental
any refund of property taxes received        $948 is claimed as rental expense. The      contract to claim rent for credit. In most
in 2006 that was a result of a corrected     calculations are as follows:                cases, 20 percent of rent paid is
tax bill from a previous year.                                                           considered property tax that can be
                                             Step 1:
Do not include:                                                                          claimed for credit. The following are
                                             $395 x 12 = $4,740 annual rent              exceptions:
• Delinquent property taxes (e.g.,
                                             $4,740 x .20 = $948 taxes attributable      • If you live in housing on which
2005 property taxes paid in 2006)
                                             to the apartment                            service fees are paid instead of taxes,
• Penalty and interest on late
                                             $2,150 eligible taxes - $948 = $1,202       10 percent of your rent can be claimed
payments of property tax                     taxes attributable to owner’s homestead     for credit. If the landlord says your tax
• Delinquent water or sewer bills                                                        share is less than 10 percent, use the
                                             Step 2:
• Property taxes on cottages or second       $2,150 total taxes - $858 taxes claimed     amount the landlord gives you.
homes                                                                                    • If your housing is exempt from
                                             as a business deduction = $1,292 taxes
• Association dues on your property          attributable to homestead                   property tax and no service fee is paid,
• Most special assessments for drains,                                                   you are not eligible for credit. This
                                             The owner’s taxes that can be claimed
sewers and roads do not meet specific                                                    includes university- or college-owned
                                             for credit are $1,202, the smaller of the
tests and may not be included. You                                                       housing.
                                             two computations.
may include special assessments only                                                     • If your housing costs are
                                             Farmers. Include farmland taxes in          subsidized, base your claim on the
if they are levied using a uniform
                                             your property tax credit claim if any of    amount you pay. Do not include the
millage rate, are based on taxable value
                                             the following conditions apply:             federal subsidy amount.
and are either levied in the entire taxing
jurisdiction or they are used to provide     • If your gross receipts from farming       • If you are a mobile home park
police, fire or advanced life support        are greater than your household             resident, claim the $3 per month
services and are levied township-wide,       income, you may claim all of your           specific tax on line 7, and the balance
except for all or a portion of a village.    farmland taxes including taxes on           of rent paid on line 8.
                                             unoccupied farmland. Do not include         • If you are a cooperative housing
Home used for business. If you use
                                             taxes on farmland that is not adjacent      corporation resident member, claim
part of your home for business, you
                                             or contiguous to your home and that         your share of the property taxes on the
may claim the property taxes on the
                                             you rent or lease to another person.        building. If you live in a cooperative
living area of your homestead, but not
the property taxes on the portion used       • If gross receipts from farming are        where residents pay rent on the land
for business.                                less than your household income and         under the building, you may also claim
                                             you have lived in your home more than       20 percent of that land rent. (Do not
Note: School operating taxes are only
                                             10 years, you may claim the taxes on        take 20 percent of your total monthly
levied on the non-homestead portion of
                                             your home and the farmland adjacent         payment.)
the property and may not be included
                                             and contiguous to your home.                • When you pay room and board in
in taxes levied when computing the
property tax credit.                         • If gross receipts from farming are        one fee, you must also determine your
                                             less than your household income and         tax that can be claimed for credit based
Owner-occupied duplexes. When
                                             you have lived in your home less than       on square footage. For example, you
both units are equal, you are limited to
                                             10 years, you may claim the taxes on        pay $750 a month for room and board.
50 percent of the tax on both units,
                                             your home and five acres of farmland        You occupy 600 square feet of a 62,000
after subtracting the school operating
                                             adjacent and contiguous to your home.       square foot apartment building. The
taxes from the total taxes billed.
                                             You may not claim rent paid for             landlord pays $54,000 in taxes per year.
Owner-occupied income property.
                                             vacant farmland when computing your         Step 1: 600/62,000 = .0097
Apartment building and duplex owners
                                             property tax credit claim.                  Step 2: $54,000 x .0097 = $524 taxes
who live in one of the units or single
family homeowners who rent a room(s)         Include any farmland preservation tax       you can claim for credit.
to a tenant(s) must do two calculations      credit in your household income. Enter
to figure the tax they can claim and         the amount of credit you received in
base their credit on the lower amount.       2006 on line 17 or include it in net farm
                                             income on line 15.
18
                                             directly to the facility by a government     deceased person or on a jointly filed
If You Moved in 2006                         agency.                                      credit if both filers became deceased
Residents who temporarily lived              If you maintain a homestead and your         during the 2006 tax year, must prorate
outside Michigan may qualify for a           spouse lives in an adult care home, you      taxes to the date of death. Complete
credit if Michigan remained their state      may file a joint credit claim. Combine       lines 38-42 to prorate the property
of domicile. Personal belongings and         the tax for your homestead and your          taxes. Annualize household income.
furnishings must have remained in the        spouse’s share of the facility’s property    (See the instructions for line 29 and 34
Michigan homestead and the                   tax to compute your claim.                   on page 22.) Attach a copy of the tax
homestead must not have been rented                                                       bills or rent receipts. If filing as a
or sublet during the temporary absence.      If you are single and maintain a             personal representative or claimant
(See the definitions of resident on page     homestead (that is not rented) while         of a deceased taxpayer(s) for a jointly
6 and domicile on page 17.)                  living in an adult care home, you may        filed return, you must attach a U.S.
                                             claim either your homestead or your          1310 Form or Form MI-1310. Enter
If you bought or sold your home, you
                                             share of the facility’s property tax, but    the names of the deceased persons in
must prorate your taxes. Complete
                                             not both. Use the one that gives you the     the Filer’s and Spouse’s Name fields
Form MI-1040CR, lines 36-42, to
                                             larger credit.                               and the representative’s or claimant’s
determine the taxes that can be claimed
for credit. Use only the taxes levied in                                                  name, title and address in the Home
                                             Deceased Claimant’s Credit
2006 on each Michigan homestead,                                                          Address field. See “Deceased
then prorate taxes based on days of          The estate of a taxpayer who died in         Taxpayer Chart of Examples” on page
occupancy. Do not include taxes on           2006 (or 2007 before filing a claim) may     43.
out-of-state property.                       be entitled to a credit for 2006. The
                                                                                          If you are a personal representative or
                                             surviving spouse, other authorized
                                                                                          claimant filing a joint return, see
Part-Year Residents                          claimant or personal representative can
                                                                                          “Deceased Taxpayers” on page 7.
                                             claim this credit. Use the deceased’s
If you lived in Michigan at least six
                                             Social Security number and the personal      Married During 2006
months during the year, you may be
                                             representative’s address. If taxpayer died
entitled to a partial credit. If you are a                                                If you married during 2006, combine
                                             after December 31, 2005, enter the date
part-year resident, you must include all                                                  each spouse’s share of taxes or rent for
                                             of death in the “Deceased Taxpayers”
income received as a Michigan resident                                                    the period of time he or she lived in
                                             box on the bottom of page 2.
in household income (line 28).                                                            separate homesteads. Then add the
Complete Form MI-1040CR, lines 36-           The surviving spouse may file a joint        prorated share of taxes or rent for the
42, to determine the taxes eligible to be    claim with the deceased. Enter both          time you lived together in your marital
claimed for credit on your Michigan          names and Social Security numbers on         home. This only applies to homes
homestead.                                   the form, and write “DECD” after the         located in Michigan.
                                             deceased’s name. Sign the return and
Residents of Nursing Homes                   write “filing as surviving spouse” in the    Married Filing Separately
and Other Adult Care Homes                   deceased’s signature block. Enter the
                                                                                          Spouses who file separate Michigan
                                             date of death in the “Deceased
If you are a resident of a nursing home,                                                  income tax returns and share a
                                             Taxpayers” box on the bottom of page
adult foster care home or home for the                                                    household are entitled to one property
                                             2. Include the deceased’s income in
aged, that facility is considered your                                                    tax credit. Complete your property tax
                                             household income.
homestead. If the facility pays local                                                     credit claim jointly and include income
property taxes (many do not), you may        If filing as a personal representative       from both spouses in household
claim your portion of those taxes for        or claimant to the refund of a single        income. Divide the credit as you wish.
credit. You may not claim rent. Ask the      deceased taxpayer(s), you must attach        If each spouse claims a portion of the
manager what your share is or, to            a Statement of Person Claiming Refund        credit, attach a copy of the claim
determine it yourself, divide the            Due a Deceased Taxpayer (U.S. 1310)          showing each spouse’s share of the
amount of property tax levied on the         or Michigan Claim for Refund Due a           credit to each income tax return. Enter
facility in 2006 by the number of            Deceased Taxpayer (Form MI-1310).            only your portion of the credit on
residents for which the facility is          Enter the deceased’s name in the Filer’s     Form MI-1040, line 34.
licensed. This is your share. If both you    Name field and the representative’s or
and your spouse live in the facility, add    claimant’s name and title in the             Separated and Filing a Joint
your shares together. If you lived in the    Spouse’s Name field. See the                 Return With Your Spouse
facility only part of the year, multiply     “Deceased Taxpayer Chart of
                                                                                          Your claim must be based on the tax or
this amount by the portion of the year       Examples” on page 43. A claimant
                                                                                          rent for 12 months on only one home.
you lived at the facility.                   must prorate to the date of death as
                                                                                          The household income must be the
                                             noted in the following paragraph.
Exception: Credit is not allowed if                                                       combined income of both you and your
your facility care charges are paid          The personal representative or               spouse for the entire year.
                                             claimant claiming a credit for a single
                                                                                                                               19
                                              Step 1: Calculate the prorated income         Step 5: Calculate each individual’s
Filing Separate Federal and                   for each spouse for the 274 days they         share of the prorated taxes. Multiply the
State Returns and Maintaining                 lived together. Divide each spouse’s          $1,396 by the percentages determined
Separate Homesteads                           total income by 365 days then multiply        in Step 3.
You may each claim a credit. Each             that figure by 274.                               Susan $1,396 x 44% = $614
credit is based on the individual taxes       Susan ($20,000/365) x 274 = $15,014               Bob       $1,396 x 56% = $782
or rent and individual income for each        Bob ($25,000/365) x 274 = $18,767             Enter these amounts on your
person.
                                              Step 2: Add both prorated incomes             MI-1040CR, line 41, column A.
Separated or Divorced in 2006                 together to determine the total income        Susan uses lines 38-41, column B, to
                                              for the time they lived together.             compute her share of taxes for the
Figure your credit based on the taxes
                                                      $15,014 + $18,767 = $33,781           remaining 91 days.
you paid together before your
separation plus the taxes you paid            Step 3: Divide each individual’s              Bob uses lines 43-44 to compute his
individually after your separation.           prorated share of income by the total         share of rent. Each completes the
Attach a schedule showing your                income from Step 2 to determine the           remaining lines of the MI-1040CR
computation.                                  percentage of income attributable to          according to the form instructions.
                                              each.
For example, Bob and Susan separated
on October 2, 2006. The annual taxes            Susan $15,014/$33,781 = 44%                 Single Adults Sharing a Home
on the home they owned were $1,860.             Bob $18,767/$33,781 = 56%                   When two or more single adults share
Susan continued to live in the home           Step 4: Calculate the prorated taxes          a home, each may file a credit claim if
and Bob moved to an apartment on              eligible for credit for the time they lived   each has contracted to pay rent or owns
October 2 and paid $350 per month             together. Divide the $1,860 by 365            a share of the home. Each adult should
rent for the rest of the year. Susan          days, then multiply by 274 days.              file an individual claim based on his or
earned $20,000 and Bob earned                     ($1,860/365) x 274 = $1,396               her household income and prorated
$25,000. They lived together for 274                                                        share of taxes or rent paid.
days.


                     Line-by-Line Instructions for Form MI-1040CR
Lines not listed are explained on the form.   in 2006. If your family lived in              other amounts reported to you on Form
Lines 1, 2 and 3: Enter your name(s),         Michigan and one spouse earned wages          W-2.
address and Social Security number(s).        outside Michigan, include the income
                                              earned out of state in your household         Line 13: Enter the total of the amounts
If you are married, filing separate
                                              income. (See “Household Income” on            from your U.S. Schedule C (business
claims, enter both Social Security
                                              page 17 and “Property Taxes That Can          income or loss), U.S. 4797 (other gain
numbers, but do not enter your
                                              Be Claimed for Credit” on page 18.)           or loss) and U.S. Schedule E (rents,
spouse’s name.
                                                                                            royalties, partnerships, S corporations,
Line 5: Check the box(es) that applies        Line 6: If you own your homestead,            estates and trusts). Include amounts
to you or your spouse as of                   enter the 2006 taxable value from your        from sources outside Michigan. Attach
December 31, 2006:                            2006 property tax statement or                these schedules to your claim.
                                              assessment notice. If you do not know
a) Age 65 or older.                                                                         Line 14: Enter all annuity, retirement
                                              your taxable value, ask your local
Unremarried surviving spouse of a             treasurer. Farmers should include the         pension and IRA benefits and the name
person who was 65 or older at the time        taxable value on all land that qualifies      of the payer. This should be the taxable
of death. You are considered 65 the day       for this credit.                              amount shown on your U.S. 1099-R. If
before your 65th birthday.                                                                  no taxable amount is shown on your
b) Deaf, blind (see page 10, 9c               Line 7: Read “Property Taxes That Can         U.S. 1099-R, use the amount required
instructions), hemiplegic, paraplegic,        Be Claimed for Credit” on page 18             to be included in AGI. Enter zero if all
quadriplegic or totally and permanently       before you complete this line.                of your distribution is from your
disabled (as defined under Social                                                           contributions made with income
Security Guidelines 42 USC 416).              Line 11: Enter all compensation               previously included in AGI. Include
                                              received as an employee. Include strike       reimbursement payments such as an
Property Tax and Household                    pay, supplemental unemployment                increase in a pension to pay for
Income                                        benefits (SUB pay), sick pay or long-         Medicare charges. Also include the
                                              term disability benefits, including           total amount of any lump sum
Include all taxable and nontaxable
                                              income protection insurance and any           distribution including amounts reported
income you and your spouse received
                                                                                            on your U.S. 4972. Do not include
20
recoveries of after-tax contributions or   • Compensation for damages to
                                                                                       Line 25: Enter total adjustments from
amounts rolled over into another plan      character or for personal injury or
                                                                                       your U.S. 1040, line 36, or U.S. 1040A,
(amounts rolled over into a Roth IRA       sickness
                                                                                       line 20. Describe adjustments to
must be included to the extent included    • An inheritance (except an                 income. These adjustments reduce
in AGI).                                   inheritance from your spouse)               household income and include the
You must include any part of a             • Proceeds of a life insurance policy       following:
distribution from a Roth IRA that          paid on the death of the insured (except    • Archer MSA deduction
exceeds your total contributions to the    benefits from a policy on your
Roth IRA regardless of whether this                                                    • Certain business expenses of
                                           spouse)
amount is included in AGI. Assume                                                      reservists, performing artists and fee-
                                           • Death benefits paid by or on behalf       basis government officials (U.S. 2106
that all contributions to the Roth IRA     of an employer
are withdrawn first. Note: Losses                                                      or U.S. 2106EZ)
from Roth IRAs cannot be deducted.         • The value over $300 in gifts of cash,     • Payments to individual retirement
                                           merchandise or expenses paid on your        accounts (IRAs), SEP, SIMPLE or
Line 15: Enter the amount from U.S.        behalf (rent, taxes, utilities, food,       qualified plans
Schedule F (farm income or loss).          medical care, etc.) from parents,           • Student loan interest deduction
Attach Schedule F.                         relatives or friends
                                                                                       • Medical savings account deduction
Line 16: Enter net capital gains and       • Minister’s housing allowance
                                                                                       • Health savings account deduction
losses. This is the total of short- and    • Amounts paid directly to you as a         • Moving expenses into or within
long-term gains, less short- and long-     scholarship, stipend, grant or GI bill      Michigan
term losses from your U.S. Schedule        benefits
                                                                                       • Deduction for self-employment tax
1040D, line 16 (for gains) or line 21      • Reimbursement from dependent
(for losses--cannot exceed $3,000).                                                    • Self-employed health insurance
                                           care and/or medical care spending
Include gains realized on the sale of                                                  deduction
                                           accounts.
your residence regardless of your age                                                  • Penalty on early withdrawal of
                                           Also include payments made on your          savings
or whether or not these gains are
                                           behalf except government payments
exempt from federal income tax.                                                        • Alimony paid
                                           made directly to an educational
                                           institution or subsidized housing           • Jury duty pay you gave to your
Line 17: Enter alimony received and
                                           project.                                    employer
other taxable income. Describe other
taxable income. This includes:                                                         • Domestic production activities
                                           Line 22: Enter service-connected            deduction
• Awards, prizes, lottery, bingo and       disability compensation and pension         • Any other adjustments to gross
other gambling winnings over $300          benefits     from       the Veterans        income included on line 36 of your
• Farmland preservation tax credits, if    Administration        and      workers’     2006 U.S. 1040.
not included in farm income on line 15.    compensation benefits. Veterans
                                                                                       Also enter the amount of an NOL
                                           receiving retirement benefits should
Line 18: Enter your Social Security,                                                   deduction. Note: A deduction for a
                                           enter the benefits on line 14.
Supplemental Security Income (SSI)                                                     carryback or carryforward of an NOL
and/or Railroad Retirement benefits.       Line 23: Enter the total payments           cannot exceed federal modified taxable
Include death benefits and amounts         made to your household by the DHS           income. Attach your Form MI-1045.
received for minor children or other       and all other public assistance
                                                                                       Line 26: Enter medical insurance or
dependent adults who live with you.        payments. Your 2006 Client Annual
                                                                                       HMO premiums you paid for yourself
Report the amount actually received.       Statement (DHS-1241) mailed by DHS
                                                                                       and your family (not Medicare).
Do not include the amount deducted         in January 2007 will show your total
                                                                                       Include medical insurance premiums
for Medicare.                              DHS payments. Your statement(s) may
                                                                                       paid through post-tax payroll deduction.
                                           include the following: Family
Line 19: Enter child support and all                                                   Include the portion of auto insurance
                                           Independence Program (FIP)
payments received as a foster parent.                                                  paid for medical coverage. Do not
                                           assistance, State Disability Assistance
Note: If you received a 2006 Child                                                     include insurance premiums deducted
                                           (SDA), Refugee Assistance, Repatriate
Support Year-End Statement (FEN-851)                                                   on line 25 or premiums paid for income
                                           Assistance and vendor payments for
showing child support payments paid to                                                 protection and long-term care insurance
                                           shelter, heat and utilities. Note: If you
the Friend of the Court, enter the child                                               or amounts paid through pre-tax
                                           received a 2006 FEN-851, subtract the
support portion here and attach a copy                                                 payroll.
                                           amount of child support payments
of the statement. See line 23.             entered on line 19 from the total DHS
                                           payments and enter the difference here.
Line 21: Enter other nontaxable
income. This includes:

                                                                                                                            21
                                                 $73,650. The surviving spouse filing                               government agency, unless payment is
Property Tax Credit                              a joint claim does not have to annualize                           made with money withheld from your
Line 29: Multiply line 28 by 3.5                 the deceased spouse’s income.                                      benefit.
percent (.035) or the percentage from            To annualize income (project what
Table 3 on this page. This is the                it would have been for a full year):                               Credit Proration
amount that will not be refunded.                                                                                   If you received FIP assistance or other
                                                 Step 1: Divide 365 by the number of
The personal representative claiming a                                                                              DHS benefits in 2006, prorate your
                                                 days the claimant was a Michigan
credit for a deceased taxpayer with                                                                                 credit to reflect the ratio of income
                                                 resident in 2006.
household income of $6,000 or less                                                                                  from other sources to total household
must annualize the deceased’s income             Step 2: Multiply the answer from step
                                                                                                                    income. To prorate your credit,
and use the annualized figure to                 1 by the claimant’s household income
                                                                                                                    complete your Form MI-1040CR, lines
determine      the    nonrefundable              (line 28). The result is annualized
                                                                                                                    1-30 first, then use the information
percentage from Table 3 on this page.            income.
                                                                                                                    from your form to complete Worksheet
Then use the actual household income                                                                                5 below.
to compute the credit. See instructions          Line 35: If you and your spouse had
for annualizing on this page.                    a different residency status, check the
                                                 box that applies to each spouse.                                   Alternate Property Tax Credit
                                                                                                                    for Renters Age 65 or Older
Line 34: Taxpayers with household
income over $82,650 (line 28) are not            Renters                                                            Worksheet 6, Line B: Enter rent paid
eligible for credit in any category. The         See “Rent That Can Be Claimed for                                  from line 44 or, if you live in service
computed credit is reduced by 10                 Credit” on page 18.                                                fee housing, enter amount from line 46.
percent for every $1,000 (or part of                                                                                If you moved from one rental
$1,000) that your household income               Line 43: If you rented a Michigan                                  homestead to another during the last
exceeds $73,650. If you are filing a             homestead subject to local property                                two years (also see “If You Moved in
part-year return (for a deceased                 taxes, enter the street number and                                 2006” on page 19), enter smaller of:
taxpayer or a part-year resident), you           name, city, landlord’s name and                                    • The final month’s rent on your
must annualize the household income              address, number of months rented, rent                             previous rented homestead multiplied
to determine if the credit reduction             paid per month and total rent paid. Do                             by 12, or
applies. If the annualized income is             this for each Michigan homestead
                                                                                                                    • The actual rent paid from line 44 or
more than $73,650, use actual                    rented during 2006. If you need more
                                                                                                                    line 46.
household income to compute the                  space, attach an additional sheet. Do
credit; then reduce the credit 10 percent        not include more than 12 months’ rent.
for every $1,000 (or part of $1,000)             Do not include amounts paid directly
that your annualized income exceeds              to the landowner on your behalf by a


                                                                               WORKSHEET 5 - FIP/DHS BENEFITS
      TABLE 3: PERCENT OF
                                                   A. Enter amount from line 23 (FIP and other DHS benefits) ..........................                           ________
     TAXES NOT REFUNDABLE
                                                   B. Enter amount from line 28 (Household Income) ........................................                       ________
                                                   C. Subtract line A from line B (if amount is a negative value, enter 0) ..........                             ________
 ALL GENERAL CLAIMANTS                             D. Divide line C by line B and enter percentage here .....................................                     ________
 Income                           % of Income
                                                   E. If you checked a box on line 5, enter amount from line 30. All others,
 $0 - $82,650 ........................... 3.5%
                                                      multiply amount on line 30 by 60% (.60) and enter here (max. $1,200) ...                                    ________
                                                   F. Multiply line E by line D. If you are age 65 or older and you rent your
 OTHER CLAIMANTS*
                                                      home, enter amount here and on line A of Worksheet 6 below.
 Income                           % of Income
                                                      Otherwise, enter here and on your MI-1040CR, line 32 .......................                                ________
 $3,000 or less ........................... 0%
 $3,001 - $4,000 ......................... 1%
 $4,001 - $5,000 ......................... 2%                 WORKSHEET 6 - ALTERNATE PROPERTY TAX CREDIT
 $5,001 - $6,000 ......................... 3%                       FOR RENTERS AGE 65 AND OLDER
 More than $6,000 ................... 3.5%
                                                   A.   Enter amount from line 30 or from Worksheet 5, Line F, above ...............                              ________
 *Other claimants are senior citizens or           B.   Enter rent paid from line 44 or line 46 .......................................................           ________
 people who are paraplegic, hemiplegic,            C.   Multiply amount on line 28 by 40% (.40) and enter here ..........................                         ________
 quadriplegic, blind, deaf, or totally and
 permanently disabled or unremarried               D.   Subtract line C from line B. If line C is more than line B, enter “0” ........                            ________
 spouse of an individual 65 or older.              E.   Enter the larger of line A or line D here and carry amount to your
                                                        MI-1040CR, line 32 ....................................................................................   ________



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