Ownership Submission
FORM 5
Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
Form 3 Holdings Reported
Form 4 Transactions Reported
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

ANNUAL STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940
OMB APPROVAL
OMB Number: 3235-0362
Expires: January 31, 2005
Estimated average burden hours per response... 1.0

1. Name and Address of Reporting Person *
MATHEW MICH
 2. Issuer Name and Ticker or Trading Symbol
MICROSOFT CORP [MSFT] 		5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
_____ Director _____ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
Senior Vice President
(Last)
(First)
(Middle)

ONE MICROSOFT WAY		 3. Statement for Issuer's Fiscal Year Ended (Month/Day/Year)
06/30/2005
(Street)


REDMOND, WA 98052-6399		 4. If Amendment, Date Original Filed(Month/Day/Year)
 6. Individual or Joint/Group Reporting
(check applicable line)

_X_ Form Filed by One Reporting Person
___ Form Filed by More than One Reporting Person
(City)
(State)
(Zip)
Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1.Title of Security
(Instr. 3)		 2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code
(Instr. 8)		 4. Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)		 5. Amount of Securities Beneficially Owned at end of Issuer's Fiscal Year
(Instr. 3 and 4)		 6. Ownership Form: Direct (D) or Indirect (I)
(Instr. 4)		 7. Nature of Indirect Beneficial Ownership
(Instr. 4)
Amount (A) or (D) Price
Common Stock             40,502 (1) D  
Common Stock             1,626 (2) I By 401(k)
Common Stock             499,201 I By Spouse

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly. Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number. SEC 2270 (9-02)

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 3)		 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (Month/Day/Year) 3A. Deemed Execution Date, if any (Month/Day/Year) 4. Transaction Code
(Instr. 8)		 5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4, and 5)		 6. Date Exercisable and Expiration Date
(Month/Day/Year)		 7. Title and Amount of Underlying Securities
(Instr. 3 and 4)		 8. Price of Derivative Security
(Instr. 5)		 9. Number of Derivative Securities Beneficially Owned at End of Issuer's Fiscal Year
(Instr. 4)		 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)		 11. Nature of Indirect Beneficial Ownership
(Instr. 4)
(A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
Employee Stock Option (right to buy) #0285231 $ 25.1438 (3)           08/20/2005(4) 02/20/2011 Common Stock
355,556
  355,556 (3)
D
 
Employee Stock Option (right to buy) #0365282 $ 21.591 (5)           07/31/2005(6) 07/31/2012 Common Stock
255,556
  255,556 (5)
D
 

Reporting Owners

Reporting Owner Name / Address Relationships
Director 10% Owner Officer Other
MATHEW MICH
ONE MICROSOFT WAY
REDMOND, WA 98052-6399		       Senior Vice President  

Signatures

Keith R. Dolliver, Attorney-in-Fact for Michelle J. Mathews 07/08/2005
**Signature of Reporting Person Date

Explanation of Responses:

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1) Includes 271 shares acquired on June 30, 2005 under the Microsoft employee stock purchase plan. Also includes an increase to the existing 2002, 2003 and 2004 stock awards in the aggregate of 2,183 shares in connection with the $3.00 special dividend paid to shareholders of record on November 17, 2004.
(2) 401(k) balance as of June 30, 2005.
(3) This option was previously reported as an option covering 320,000 shares at an exercise price of $27.9375 per share and has been adjusted in connection with the $3.00 special dividend paid to shareholders of record on November 17, 2004.
(4) 266,667 shares are vested and immediately exercisable, 44,444 shares will vest and become exercisable on August 20, 2005 and 44,445 shares will vest and become exercisable on February 20, 2006.
(5) This option was previously reported as an option covering 230,000 shares at an exercise price of $23.99 per share and has been adjusted in connection with the $3.00 special dividend paid to shareholders of record on November 17, 2004.
(6) 95,833 shares are vested and immediately exercisable, 31,945 shares will vest and become exercisable on July 31, 2005, 31,944 shares will vest and become exercisable on January 31, 2006, 31,945 shares will vest and become exercisable on July 31, 2006, 31,944 shares will vest and become exercisable on January 31, 2007, and 31,945 shares will vest and become exercisable on July 31, 2007.

Note: File three copies of this Form, one of which must be manually signed. If space provided is insufficient, see Instruction 6 for procedure.

Potential persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB number.