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

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
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(Print or Type Responses)
1. Name and Address of Reporting Person *
KOROLOGOS ANN MCLAUGHLIN
   2. Issuer Name and Ticker or Trading Symbol
MICROSOFT CORP [MSFT] 		5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
__X__ Director _____ 10% Owner
_____ Officer (give title below) _____ Other (specify below)
(Last)
(First)
(Middle)
C/O MICROSOFT CORPORATION, ONE MICROSOFT WAY		 3. Date of Earliest Transaction (Month/Day/Year)
01/04/2005
(Street)

REDMOND, WA 98052-6399		 4. If Amendment, Date Original Filed(Month/Day/Year)
 6. Individual or Joint/Group Filing(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 Following Reported Transaction(s)
(Instr. 3 and 4)		 6. Ownership Form: Direct (D) or Indirect (I)
(Instr. 4)		 7. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V Amount (A) or (D) Price
Common Stock 01/04/2005   A   4,000 (1) A $ 0 10,444 (2) D  

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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 Following Reported Transaction(s)
(Instr. 4)		 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)		 11. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
Stock Option (Right to Buy) #0168541 $ 44.0438 (3)             01/31/2001(4) 01/31/2010 Common Stock 33,333   33,333 (3) D  
Stock Option (Right to Buy) #0283210 $ 27.2532 (5)             01/23/2002(6) 01/23/2008 Common Stock 22,222   22,222 (5) D  
Stock Option (Right to Buy) #0316196 $ 29.007 (7)             01/22/2003(8) 01/22/2012 Common Stock 22,222   22,222 (7) D  
Stock Option (Right to Buy) #0372476 $ 24.174 (9)             02/13/2004(10) 02/13/2013 Common Stock 22,222   22,222 (9) D  

Reporting Owners

Reporting Owner Name / Address Relationships
 Director  10% Owner  Officer  Other
KOROLOGOS ANN MCLAUGHLIN
C/O MICROSOFT CORPORATION
ONE MICROSOFT WAY
REDMOND, WA 98052-6399		   X      

Signatures

 Keith R. Dolliver, Attorney-in-Fact for Ann McLaughlin Korologos   01/06/2005
**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) Represents stock award which shall vest over 5 years at the rate of 20% on the first anniversary of the date of grant and then at the rate of 20% on each of the following four anniversaries thereafter, subject to continuous service on the Board of Directors.
(2) Includes an increase of 444 shares to the 1/5/04 stock award as a result of an adjustment made in connection with the $3.00 special dividend.
(3) This option was previously reported as an option covering 15,000 shares at an exercise price of $97.88 per share, and has been adjusted as a result of a 2-for-1 stock split on February 14, 2003. This option has been further adjusted in connection with the $3.00 special dividend payable to shareholders of record on November 17, 2004.
(4) The option vests at the rate of 1/3 on January 31, 2001 and additional 1/3 increments every year thereafter.
(5) This option was previously reported as an option covering 10,000 shares at an exercise price of $60.56 per share, and has been adjusted as a result of a 2-for-1 stock split on February 14, 2003. This option has been further adjusted in connection with the $3.00 special dividend payable to shareholders of record on November 17, 2004.
(6) The option vests at the rate of 1/8 on January 23, 2002 and additional 1/8 increments every six months thereafter.
(7) This option was previously reported as an option covering 10,000 shares at an exercise price of $64.46 per share, and has been adjusted as a result of a 2-for-1 stock split on February 14, 2003. This option has been further adjusted in connection with the $3.00 special dividend payable to shareholders of record on November 17, 2004.
(8) The option vests at the rate of 1/8 on January 22, 2003 and additional 1/8 increments every six months thereafter.
(9) This option was previously reported as an option covering 10,000 shares at an exercise price of $53.72 per share, and has been adjusted as a result of a 2-for-1 stock split on February 14, 2003. This option has been further adjusted in connection with the $3.00 special dividend payable to shareholders of record on November 17, 2004.
(10) The option vests at the rate of 1/4 on February 13, 2004 and additional 1/8 increments every six months thereafter.

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