Penalty and Interest
1. How is penalty and interest calculated?

You will owe penalty and interest for late payment of tax if you pay after the due date. The filing due date is April 18, 2016 for the 2015 tax return.

Penalty accrues monthly at 1 percent of the tax due, and increases by an additional 1 percent per month, or fraction thereof (e.g., penalty on a $500 tax due will be $30 if the tax is unpaid for six months).

The interest rate is 1 percent above the adjusted prime rate and is adjusted on January 1 and July 1 of each year. Interest is charged from the original due date of the return to the date the balance of the tax is paid. The interest rate through June 30, 2016 is 4.25 percent annually (.0001161 daily rate). For interest rates after June 30, 2016 visit www.michigan.gov/citytax

Typically, if you owe more than $100, you are required to make estimated payments. See special note below and information about estimated payments.

If the balance due is less than $1, no payment is required, but you must still file your return.

Special note for people required to file estimates. You may owe penalty and interest for underpayment, late payment or for failing to make estimated tax payments. Treasury will compute your penalty and interest and send you a bill.