[2023-143 Code 1501 Amend Exhibit A.pdf]
CHAPTER 1501
Municipal Income Tax
EDITOR’S NOTE: It is found and determined by the Council that this chapter is to have
prospective application only. Salaries, wages, commissions and other compensation,
together with net profis, or any other income subject to the North Olmsted municipal
income tax and earned in and prior to the year 2015 shall be governed by Chapter 15, Title
One of the Codified Ordinances, titled “Taxation Code; Municipal Income Tax” as it existed
immediately prior to the effective date of this chapter.
1501.01 Authority to levy tax; purpose of tax.
1501.02 Definitions.
1501.03 Imposition of income tax.
1501.04 Collection at source.
1501.05 Annual return; filing.
1501.06 Credit for tax paid to other municipalities.
1501.07 Estimated taxes.
1501.08 Rounding of amounts.
1501.09 Requests for refunds.
1501.10 Second municipality imposing tax after time period allowed for refund.
1501.11 Amended returns.
1501.12 Limitations.
1501.13 Audits.
1501.14 Service of assessment.
1501.15 Administration of claims.
1501.16 Tax information confidential.
1501.17 Fraud.
1501.18 Interest and penalties.
1501.19 Authority of Tax Administrator; verification of information.
1501.20 Request for opinion of the Tax Administrator.
1501.21 Board of Tax Review.
1501.22 Authority to create rules and regulations.
EXHIBIT A
1501.23 Rental and leased property.
1501.24 Savings clause.
1501.25 Collection of tax after termination of ordinance.
1501.26 Adoption of RITA Rules and Regulations.
1501.99 Violations; penalties.
CROSS REFERENCES
Limitation on rate of taxation - see CHTR. Art. VIII, Sec. 8
Payroll deductions - see Ohio R.C. 9.42
Municipal income taxes - see Ohio R.C. Ch. 718
1501.01 AUTHORITY TO LEVY TAX; PURPOSE OF TAX.
(A) To provide funds for the purposes of general municipal operations, maintenance,
new equipment, extension and enlargement of municipal services and facilities and capital
improvements, the City of North Olmsted (the City) hereby levies an annual municipal
income tax on income, qualifying wages, commissions and other compensation, and on net
profits as hereinafter provided. This Ordinance is to have prospective application only.
Salaries, wages, commissions and other compensation, together with net profits, or any
other income subject to the North Olmsted municipal income tax and earned in and prior to
the year 2015 shall be governed by Chapter 15, Title One of the Codified Ordinances, titled
"Taxation Code; Municipal Income Tax" as it existed immediately prior to the effective date
of this Chapter."
There shall be and is hereby levied a tax on salaries, wages, commissions and other
compensation, and on net profits as hereinafter provided, to provide funds for the City of
North Olmsted to be allocated for use as follows:
(a) Fifteen percent (15%) to pay costs of services and facilities for solid waste
management, recycling and disposal;
(b) Fifteen percent (15%) to pay costs of any permanent improvements for the City
including permanent improvements to the City's street and storm water drainage systems,
the payment of debt charges on bonds and notes issued after 1990 for those purposes, and
costs of maintaining the City's street and storm water drainage systems and related
equipment; and
(c) The balance to pay costs of general municipal functions of the City.
(B) (1) The annual tax is levied at a rate of 2% (two percent). The tax is levied at a
uniform rate on all persons residing in or earning or receiving income in North Olmsted.
The tax is levied on income, qualifying wages, commissions and other compensation, and
on net profits as hereinafter provided in Section 1501.03 of Chapter 1501 and other
sections as they may apply.
(2) Intentionally left blank.
(C) The tax on income and the withholding tax established by this Ordinance 2015-104
are authorized by Article XVIII, Section 3 of the Ohio Constitution. The tax is levied in
accordance with, and is intended to be consistent with, the provisions and limitations of
Ohio Revised Code 718.
(Ord. 2015-104. Passed 12-15-15.)
1501.02 DEFINITIONS.
(A) Any term used in Chapter 1501 (Chapter) that is not otherwise defined in this
Chapter has the same meaning as when used in a comparable context in laws of the United
States relating to federal income taxation or in Title LVII of the ORC, unless a different
meaning is clearly required. If a term used in this Chapter that is not otherwise defined in
this Chapter is used in a comparable context in both the laws of the United States relating
to federal income tax and in Title LVII of the ORC and the use is not consistent, then the use
of the term in the laws of the United States relating to federal income tax shall control over
the use of the term in Title LVII of the ORC.
(B) The singular shall include the plural, and the masculine shall include the feminine
and the gender-neutral.
(C) As used in this chapter/ordinance:
(1) "Adjusted federal taxable income," for a person required to file as a C corporation,
or for a person that has elected to be taxed as a C corporation under (C)(24)(d) of this
division, means a C corporation's federal taxable income before net operating losses and
special deductions as determined under the Internal Revenue Code, adjusted as follows:
(a) Deduct intangible income to the extent included in federal taxable income. The
deduction shall be allowed regardless of whether the intangible income relates to assets
used in a trade or business or assets held for the production of income.
(b) Add an amount equal to five percent (5%) of intangible income deducted under
division (C)(1)(a) of this section, but excluding that portion of intangible income directly
related to the sale, exchange, or other disposition of property described in Section 1221 of
the Internal Revenue Code;
(c) Add any losses allowed as a deduction in the computation of federal taxable
income if the losses directly relate to the sale, exchange, or other disposition of an asset
described in Section 1221 or 1231 of the Internal Revenue Code;
(d) (i) Except as provided in (C)(1)(d)(ii) of this section, deduct income and gain
included in federal taxable income to the extent the income and gain directly relate to the
sale, exchange, or other disposition of an asset described in Section 1221 or 1231 of the
Internal Revenue Code;
(ii) Division (C)(1)(d)(i) of this section does not apply to the extent the income or
gain is income or gain described in Section 1245 or 1250 of the Internal Revenue Code.
(e) Add taxes on or measured by net income allowed as a deduction in the
computation of federal taxable income;
(f) In the case of a real estate investment trust or regulated investment company, add
all amounts with respect to dividends to, distributions to, or amounts set aside for or
credited to the benefit of investors and allowed as a deduction in the computation of
federal taxable income;
(g) Deduct, to the extent not otherwise deducted or excluded in computing federal
taxable income, any income derived from a transfer agreement or from the enterprise
transferred under that agreement under Section 4313.02 of the ORC;
(h) (i) Except as limited by divisions (C)(1)(h)(ii), (iii), and (iv) of this section,
deduct any net operating loss incurred by the person in a taxable year beginning on or after
January 1, 2017.
The amount of such net operating loss shall be deducted from net profit that is reduced by
exempt income to the extent necessary to reduce municipal taxable income to zero, with
any remaining unused portion of the net operating loss carried forward to not more than
five consecutive taxable years following the taxable year in which the loss was incurred,
but in no case for more years than necessary for the deduction to be fully utilized.
(ii) No person shall use the deduction allowed by division (C)(1)(h) of this section
to offset qualifying wages.
(iii) (a) For taxable years beginning in 2018, 2019, 2020, 2021, or 2022, a person
may not deduct more than fifty percent (50%) of the amount of the deduction otherwise
allowed by division (C)(1)(h)(i) of this section.
(b) For taxable years beginning in 2023 or thereafter the full amount allowed by
(C)(1)(h)(i) of this section.
(iv) Any pre-2017 net operating loss carryforward deduction that is available must
be utilized before a taxpayer may deduct any amount pursuant to (C)(1)(h) of this section.
(v) Nothing in division (C)(1)(h)(iii)(a) of this section precludes a person from
carrying forward, use with respect to any return filed for a taxable year beginning after
2018, any amount of net operating loss that was not fully utilized by operation of division
(C)(1)(h)(iii)(a) of this section. To the extent that an amount of net operating loss that was
not fully utilized in one or more taxable years by operation of division (C)(1)(h)(iii)(a) of
this section is carried forward for use with respect to a return filed for a taxable year
beginning in 2019, 2020, 2021, or 2022, the limitation described in division
(C)(1)(h)(iii)(a) of this section shall apply to the amount carried forward.
(i) Deduct any net profit of a pass-through entity owned directly or indirectly by the
taxpayer and included in the taxpayer's federal taxable income unless an affiliated group of
corporations includes that net profit in the group's federal taxable income in accordance
with division (V)(3)(b) of Section 1501.05 .
(j) Add any loss incurred by a pass-through entity owned directly or indirectly by the
taxpayer and included in the taxpayer's federal taxable income unless an affiliated group of
corporations includes that loss in the group's federal taxable income in accordance with
division (V)(3)(b) of Section 1501.05 .
If the taxpayer is not a C corporation, is not a disregarded entity that has made an election
described in division (C)(48)(b) of this section, is not a publicly traded partnership that has
made the election described in division (C)(24)(d) of this section, and is not an individual,
the taxpayer shall compute adjusted federal taxable income under this section as if the
taxpayer were a C corporation, except guaranteed payments and other similar amounts
paid or accrued to a partner, former partner, shareholder, former shareholder, member, or
former member shall not be allowed as a deductible expense unless such payments are in
consideration for the use of capital and treated as payment of interest under Section 469 of
the Internal Revenue Code or United States treasury regulations. Amounts paid or accrued
to a qualified self-employed retirement plan with respect to a partner, former partner,
shareholder, former shareholder, member, or former member of the taxpayer, amounts
paid or accrued to or for health insurance for a partner, former partner, shareholder,
former shareholder, member, or former member, and amounts paid or accrued to or for life
insurance for a partner, former partner, shareholder, former shareholder, member, or
former member shall not be allowed as a deduction.
Nothing in division (C)(1) of this section shall be construed as allowing the taxpayer to add
or deduct any amount more than once or shall be construed as allowing any taxpayer to
deduct any amount paid to or accrued for purposes of federal self-employment tax.
(2) (a) "Assessment" means a written finding by the Tax Administrator that a person
has underpaid municipal income tax, or owes penalty and interest, or any combination of
tax, penalty, or interest, to the municipal corporation that commences the person's time
limitation for making an appeal to the Board of Tax Review pursuant to Section 1501.21 ,
and has "ASSESSMENT" written in all capital letters at the top of such finding.
(b) "Assessment" does not include a notice denying a request for refund issued under
division (C)(3) of Section 1501.09 , a billing statement notifying a taxpayer of current or
past-due balances owed to the municipal corporation, a Tax Administrator's request for
additional information, a notification to the taxpayer of mathematical errors, or a Tax
Administrator's other written correspondence to a person or taxpayer that does not meet
the criteria prescribed by division (C)(2)(a) of this section.
(3) "Audit" means the examination of a person or the inspection of the books, records,
memoranda, or accounts of a person, ordered to appear before the Tax Administrator, for
the purpose of determining liability for a municipal income tax.
(4) "Board of Tax Review" or "Board of Review" or "Board of Tax Appeals", or other
named local board constituted to hear appeals of municipal income tax matters, means the
entity created under Section 1501.21 .
(5) "Calendar quarter" means the three-month period ending on the last day of March,
June, September, or December.
(6) "Casino operator" and "casino facility" have the same meanings as in Section
3772.01 of the ORC.
(7) "Certified mail," "express mail," "United States mail," "postal service," and similar
terms include any delivery service authorized pursuant to Section 5703.056 of the ORC.
(8) "Disregarded entity" means a single member limited liability company, a qualifying
subchapter S subsidiary, or another entity if the company, subsidiary, or entity is a
disregarded entity for federal income tax purposes.
(9) "Domicile" means the true, fixed, and permanent home of a taxpayer and to which,
whenever absent, the taxpayer intends to return. A taxpayer may have more than one
residence but not more than one domicile.
(10) "Employee" means an individual who is an employee for federal income tax
purposes.
(11) "Employer" means a person that is an employer for federal income tax purposes.
(12) "Exempt income" means all of the following:
(a) The military pay or allowances of members of the armed forces of the United
States or members of their reserve components, including the national guard of any state.
(b) Intangible income.
(c) Social security benefits, railroad retirement benefits, unemployment
compensation, pensions, retirement benefit payments, payments from annuities, and
similar payments made to an employee or to the beneficiary of an employee under a
retirement program or plan, disability payments received from private industry or local,
state, or federal governments or from charitable, religious or educational organizations,
and the proceeds of sickness, accident, or liability insurance policies. As used in division
(C)(12)(c) of this section, "unemployment compensation" does not include supplemental
unemployment compensation described in Section 3402(o)(2) of the Internal Revenue
Code.
(d) The income of religious, fraternal, charitable, scientific, literary, or educational
institutions to the extent such income is derived from tax-exempt real estate, tax-exempt
tangible or intangible property, or tax-exempt activities.
(e) Compensation paid under Section 3501.28 or 3501.36 of the ORC to a person
serving as a precinct election official to the extent that such compensation does not exceed
$1,000 for the taxable year. Such compensation in excess of $1,000 for the taxable year may
be subject to taxation by a municipal corporation. A municipal corporation shall not require
the payer of such compensation to withhold any tax from that compensation.
(f) Dues, contributions, and similar payments received by charitable, religious,
educational, or literary organizations or labor unions, lodges, and similar organizations;
(g) Alimony and child support received.
(h) Compensation for personal injuries or for damages to property from insurance
proceeds or otherwise, excluding compensation paid for lost salaries or wages or
compensation from punitive damages.
(i) Income of a public utility when that public utility is subject to the tax levied under
Section 5727.24 or 5727.30 of the ORC. Division (C)(12)(i) of this section does not apply for
purposes of Chapter 5745. of the ORC.
(j) Gains from involuntary conversions, interest on federal obligations, items of
income subject to a tax levied by the state and that a municipal corporation is specifically
prohibited by law from taxing, and income of a decedent's estate during the period of
administration except such income from the operation of a trade or business.
(k) Compensation or allowances excluded from federal gross income under Section
107 of the Internal Revenue Code.
(l) Employee compensation that is not qualifying wages as defined in division (C)(35)
of this section.
(m) Compensation paid to a person employed within the boundaries of a United
States air force base under the jurisdiction of the United States air force that is used for the
housing of members of the United States air force and is a center for air force operations,
unless the person is subject to taxation because of residence or domicile. If the
compensation is subject to taxation because of residence or domicile, tax on such income
shall be payable only to the municipal corporation of residence or domicile.
(n) An S corporation shareholder's share of net profits of the S corporation, other
than any part of the share of net profits that represents wages as defined in Section
3121(a) of the Internal Revenue Code or net earnings from self-employment as defined in
Section 1402(a) of the Internal Revenue Code.
(o) All of the income of individuals under 18 years of age.
(p) (i) Except as provided in divisions (C)(12)(p)(ii), (iii), and (iv) of this
section, qualifying wages described in division (C)(2) or (5) of Section 1501.04 to the
extent the qualifying wages are not subject to withholding for the City under either of those
divisions.
(ii) The exemption provided in division (C)(12)(p)(i) of this section does not
apply with respect to the municipal corporation in which the employee resided at the time
the employee earned the qualifying wages.
(iii) The exemption provided in division (C)(12)(p)(i) of this section does not
apply to qualifying wages that an employer elects to withhold under division (C)(4)(b) of
Section 1501.04 .
(iv) The exemption provided in division (C)(12)(p)(i) of this section does not apply
to qualifying wages if both of the following conditions apply:
(a) For qualifying wages described in division (C)(2) of Section 1501.04 , the
employee's employer withholds and remits tax on the qualifying wages to the municipal
corporation in which the employee's principal place of work is situated, or, for qualifying
wages described in division (C)(5) of Section 1501.04 , the employee's employer withholds
and remits tax on the qualifying wages to the municipal corporation in which the
employer's fixed location is located;
(b) The employee receives a refund of the tax described in division
(C)(12)(p)(iv)(a) of this section on the basis of the employee not performing services in
that municipal corporation.
(q) (i) Except as provided in division (C)(12)(q)(ii) or (iii) of this section,
compensation that is not qualifying wages paid to a nonresident individual for personal
services performed in the City on not more than 20 days in a taxable year.
(ii) The exemption provided in division (C)(12)(q)(i) of this section does not apply
under either of the following circumstances:
(a) The individual's base of operation is located in the municipal corporation.
(b) The individual is a professional athlete, professional entertainer, or public
figure, and the compensation is paid for the performance of services in the individual's
capacity as a professional athlete, professional entertainer, or public figure. For purposes of
division (C)(12)(q)(ii)(b) of this section, "professional athlete," "professional entertainer,"
and "public figure" have the same meanings as in Section 1501.04 (C).
(iii) Compensation to which division (C)(12)(q) of this section applies shall be
treated as earned or received at the individual's base of operation. If the individual does
not have a base of operation, the compensation shall be treated as earned or received
where the individual is domiciled.
(iv) For purposes of division (C)(12)(q) of this section, "base of operation" means
the location where an individual owns or rents an office, storefront, or similar facility to
which the individual regularly reports and at which the individual regularly performs
personal services for compensation.
(r) Compensation paid to a person for personal services performed for a political
subdivision on property owned by the political subdivision, regardless of whether the
compensation is received by an employee of the subdivision or another person performing
services for the subdivision under a contract with the subdivision, if the property on which
services are performed is annexed to a municipal corporation pursuant to Section 709.023
of the ORC on or after March 27, 2013, unless the person is subject to such taxation because
of residence. If the compensation is subject to taxation because of residence, municipal
income tax shall be payable only to the municipal corporation of residence.
(s) Income the taxation of which is prohibited by the constitution or laws of the
United States.
Any item of income that is exempt income of a pass-through entity under division (C) of
this section is exempt income of each owner of the pass-through entity to the extent of that
owner's distributive or proportionate share of that item of the entity's income.
(13) "Form 2106" means internal revenue service form 2106 filed by a taxpayer
pursuant to the Internal Revenue Code.
(14) "Generic form" means an electronic or paper form that is not prescribed by a
particular municipal corporation and that is designed for reporting taxes withheld by an
employer, agent of an employer, or other payer, estimated municipal income taxes, or
annual municipal income tax liability or for filing a refund claim.
(15) "Gross receipts" means the total revenue derived from sales, work done, or
service rendered.
(16) "Income" means the following:
(a) (i) For residents, all income, salaries, qualifying wages, commissions, and other
compensation from whatever source earned or received by the resident, including the
resident's distributive share of the net profit of pass-through entities owned directly or
indirectly by the resident and any net profit of the resident, except as provided in
(C)(24)(d) of this division.
(ii) For the purposes of division (C)(16)(a)(i) of this section:
(a) Any net operating loss of the resident incurred in the taxable year and the
resident's distributive share of any net operating loss generated in the same taxable year
and attributable to the resident's ownership interest in a pass-through entity shall be
allowed as a deduction, for that taxable year and the following five taxable years, against
any other net profit of the resident or the resident's distributive share of any net profit
attributable to the resident's ownership interest in a pass-through entity until fully utilized,
subject to division (C)(16)(a)(iv) of this section;
(b) The resident's distributive share of the net profit of each pass-through entity
owned directly or indirectly by the resident shall be calculated without regard to any net
operating loss that is carried forward by that entity from a prior taxable year and applied
to reduce the entity's net profit for the current taxable year.
(iii) Division (C)(16)(a)(ii) of this section does not apply with respect to any net
profit or net operating loss attributable to an ownership interest in an S corporation unless
shareholders' shares of net profits from S corporations are subject to tax in the municipal
corporation as provided in division(C)(12)(n) or (C)(16)(e) of this section.
(iv) Any amount of a net operating loss used to reduce a taxpayer's net profit for a
taxable year shall reduce the amount of net operating loss that may be carried forward to
any subsequent year for use by that taxpayer. In no event shall the cumulative deductions
for all taxable years with respect to a taxpayer's net operating loss exceed the original
amount of that net operating loss available to that taxpayer.
(b) In the case of nonresidents, all income, salaries, qualifying wages, commissions,
and other compensation from whatever source earned or received by the nonresident for
work done, services performed or rendered, or activities conducted in the municipal
corporation, including any net profit of the nonresident, but excluding the nonresident's
distributive share of the net profit or loss of only pass-through entities owned directly or
indirectly by the nonresident.
(c) For taxpayers that are not individuals, net profit of the taxpayer;
(d) Lottery, sweepstakes, gambling and sports winnings, winnings from games of
chance, and prizes and awards. If the taxpayer is a professional gambler for federal income
tax purposes, the taxpayer may deduct related wagering losses and expenses to the extent
authorized under the Internal Revenue Code and claimed against such winnings.
(e) Intentionally left blank.
(17) "Intangible income" means income of any of the following types: income yield,
interest, capital gains, dividends, or other income arising from the ownership, sale,
exchange, or other disposition of intangible property including, but not limited to,
investments, deposits, money, or credits as those terms are defined in Chapter 5701. of the
ORC, and patents, copyrights, trademarks, tradenames, investments in real estate
investment trusts, investments in regulated investment companies, and appreciation on
deferred compensation. "Intangible income" does not include prizes, awards, or other
income associated with any lottery winnings, gambling winnings, or other similar games of
chance.
(18) "Internal Revenue Code" has the same meaning as in Section 5747.01 of the ORC.
(19) "Limited liability company" means a limited liability company formed under
Chapter 1705. of the ORC or under the laws of another state.
(20) "Municipal corporation" includes a joint economic development district or joint
economic development zone that levies an income tax under Section 715.691 , 715.70 ,
715.71 , or 715.74 of the ORC.
(21) (a) "Municipal taxable income" means the following:
(i) For a person other than an individual, income reduced by exempt income to the
extent otherwise included in income and then, as applicable, apportioned or sitused to the
City under Section 1501.03 , and further reduced by any pre-2017 net operating loss
carryforward available to the person for the City.
(ii) (a) For an individual who is a resident of the City, income reduced by exempt
income to the extent otherwise included in income, then reduced as provided in division
(C)(21)(b) of this section, and further reduced by any pre-2017 net operating loss
carryforward available to the individual for the municipal corporation.
(b) For an individual who is a nonresident of the City, income reduced by exempt
income to the extent otherwise included in income and then, as applicable, apportioned or
sitused to the municipal corporation under Section 1501.03 , then reduced as provided in
division (C)(21)(b) of this section, and further reduced by any pre-2017 net operating loss
carryforward available to the individual for the City.
(b) In computing the municipal taxable income of a taxpayer who is an individual, the
taxpayer may subtract, as provided in division (C)(21)(a)(ii)(a) or (C)(21)(b) of this
section, the amount of the individual's employee business expenses reported on the
individual's form 2106 that the individual deducted for federal income tax purposes for the
taxable year, subject to the limitation imposed by Section 67 of the Internal Revenue Code.
For the municipal corporation in which the taxpayer is a resident, the taxpayer may deduct
all such expenses allowed for federal income tax purposes, but only to the extent the
expenses do not relate to exempt income. For a municipal corporation in which the
taxpayer is not a resident, the taxpayer may deduct such expenses only to the extent the
expenses are related to the taxpayer's performance of personal services in that nonresident
municipal corporation and are not related to exempt income.
(22) "Municipality" means the same as the City of North Olmsted. If the terms are
capitalized in the ordinance they are referring to North Olmsted. If not capitalized they
refer to a municipal corporation other than North Olmsted.
(23) "Net operating loss" means a loss incurred by a person in the operation of a trade
or business. "Net operating loss" does not include unutilized losses resulting from basis
limitations, at-risk limitations, or passive activity loss limitations.
(24) (a) "Net profit" for a person other than an individual means adjusted federal
taxable income.
(b) "Net profit" for a person who is an individual means the individual's net profit
required to be reported on schedule C, schedule E, or schedule F reduced by any net
operating loss carried forward. For the purposes of division (C)(24)(b) of this section, the
net operating loss carried forward shall be calculated and deducted in the same manner as
provided in division (C)(1)(h) of this section.
(c) For the purposes of this chapter/ordinance, and notwithstanding division
(C)(24)(a) of this section, net profit of a disregarded entity shall not be taxable as against
that disregarded entity, but shall instead be included in the net profit of the owner of the
disregarded entity.
(d) A publicly traded partnership that is treated as a partnership for federal income
tax purposes, and that is subject to tax on its net profits by the City, may elect to be treated
as a C corporation for the City. The election shall be made on the annual return for the City.
The City will treat the publicly traded partnership as a C corporation if the election is so
made.
(25) "Nonresident" means an individual that is not a resident.
(26) "Ohio Business Gateway" means the online computer network system, created
under Section 125.30 of the ORC, that allows persons to electronically file business reply
forms with state agencies and includes any successor electronic filing and payment system.
(27) "Other payer" means any person, other than an individual's employer or the
employer's agent, that pays an individual any amount included in the federal gross income
of the individual. "Other payer" includes casino operators and video lottery terminal sales
agents.
(28) "Pass-through entity" means a partnership not treated as an association taxable
as a C corporation for federal income tax purposes, a limited liability company not treated
as an association taxable as a C corporation for federal income tax purposes, an S
corporation, or any other class of entity from which the income or profits of the entity are
given pass-through treatment for federal income tax purposes. "Pass-through entity" does
not include a trust, estate, grantor of a grantor trust, or disregarded entity.
(29) "Pension" means any amount paid to an employee or former employee that is
reported to the recipient on an IRS form 1099-R, or successor form. Pension does not
include deferred compensation, or amounts attributable to nonqualified deferred
compensation plans, reported as FICA/Medicare wages on an IRS form W-2, Wage and Tax
Statement, or successor form.
(30) "Person" includes individuals, firms, companies, joint stock companies, business
trusts, estates, trusts, partnerships, limited liability partnerships, limited liability
companies, associations, C corporations, S corporations, governmental entities, and any
other entity.
(31) "Postal service" means the United States postal service.
(32) "Postmark date," "date of postmark," and similar terms include the date recorded
and marked in the manner described in division (B)(3) of Section 5703.056 of the ORC.
(33) (a) "Pre-2017 net operating loss carryforward" means any net operating loss
incurred in a taxable year beginning before January 1, 2017, to the extent such loss was
permitted, by a resolution or ordinance of the City of North Olmsted that was adopted by
the City of North Olmsted before January 1, 2016, to be carried forward and utilized to
offset income or net profit generated in the City of North Olmsted in future taxable years.
(b) For the purpose of calculating municipal taxable income, any pre-2017 net
operating loss carryforward may be carried forward to any taxable year, including taxable
years beginning in 2017 or thereafter, for the number of taxable years provided in the
resolution or ordinance or until fully utilized, whichever is earlier.
(34) "Publicly traded partnership" means any partnership, an interest in which is
regularly traded on an established securities market. A "publicly traded partnership" may
have any number of partners.
(35) "Qualifying wages" means wages, as defined in Section 3121(a) of the Internal
Revenue Code, without regard to any wage limitations, adjusted as follows:
(a) Deduct the following amounts:
(i) Any amount included in wages if the amount constitutes compensation
attributable to a plan or program described in Section 125 of the Internal Revenue Code.
(ii) Any amount included in wages if the amount constitutes payment on account of
a disability related to sickness or an accident paid by a party unrelated to the employer,
agent of an employer, or other payer.
(iii) Intentionally left blank.
(iv) Intentionally left blank.
(vi) Any amount included in wages that is exempt income.
(b) Add the following amounts:
(i) Any amount not included in wages solely because the employee was employed
by the employer before April 1, 1986.
(ii) Any amount not included in wages because the amount arises from the sale,
exchange, or other disposition of a stock option, the exercise of a stock option, or the sale,
exchange, or other disposition of stock purchased under a stock option. Division
(C)(35)(b)(ii) of this section applies only to those amounts constituting ordinary income.
(iii) Any amount not included in wages if the amount is an amount described in
section 401(k), 403(b), or 457 of the Internal Revenue Code. Division (C)(35)(b)(iii) of this
section applies only to employee contributions and employee deferrals.
(iv) Any amount that is supplemental unemployment compensation benefits
described in Section 3402(o)(2) of the Internal Revenue Code and not included in wages.
(v) Any amount received that is treated as self-employment income for federal tax
purposes in accordance with Section 1402(a)(8) of the Internal Revenue Code.
(vi) Any amount not included in wages if all of the following apply:
(a) For the taxable year the amount is employee compensation that is earned
outside the United States and that either is included in the taxpayer's gross income for
federal income tax purposes or would have been included in the taxpayer's gross income
for such purposes if the taxpayer did not elect to exclude the income under Section 911 of
the Internal Revenue Code;
(b) For no preceding taxable year did the amount constitute wages as defined in
Section 3121(a) of the Internal Revenue Code;
(c) For no succeeding taxable year will the amount constitute wages; and
(d) For any taxable year the amount has not otherwise been added to wages
pursuant to either division (C)(35)(b) of this section or Section 1501.04 , as that section
existed before the effective date of H.B. 5 of the 130th General Assembly, March 23, 2015.
(36) "Related entity" means any of the following:
(a) An individual stockholder, or a member of the stockholder's family enumerated
in Section 318 of the Internal Revenue Code, if the stockholder and the members of the
stockholder's family own directly, indirectly, beneficially, or constructively, in the
aggregate, at least fifty percent (50%) of the value of the taxpayer's outstanding stock;
(b) A stockholder, or a stockholder's partnership, estate, trust, or corporation, if the
stockholder and the stockholder's partnerships, estates, trusts, or corporations own
directly, indirectly, beneficially, or constructively, in the aggregate, at least fifty percent
(50%) of the value of the taxpayer's outstanding stock;
(c) A corporation, or a party related to the corporation in a manner that would
require an attribution of stock from the corporation to the party or from the party to the
corporation under division (C)(36)(d) of this section, provided the taxpayer owns directly,
indirectly, beneficially, or constructively, at least fifty percent of the value of the
corporation's outstanding stock;
(d) The attribution rules described in Section 318 of the Internal Revenue Code apply
for the purpose of determining whether the ownership requirements in divisions
(C)(36)(a) to (c) of this section have been met.
(37) "Related member" means a person that, with respect to the taxpayer during all or
any portion of the taxable year, is either a related entity, a component member as defined
in Section 1563(b) of the Internal Revenue Code, or a person to or from whom there is
attribution of stock ownership in accordance with Section 1563(e) of the Internal Revenue
Code except, for purposes of determining whether a person is a related member under this
division, "twenty percent (20%)" shall be substituted for "five percent (5%)" wherever
"five percent (5%)" appears in Section 1563(e) of the Internal Revenue Code.
(38) "Resident" means an individual who is domiciled in the municipal corporation as
determined under Section 1501.03 (E).
(39) "S corporation" means a person that has made an election under subChapter S of
Chapter 1 of Subtitle A of the Internal Revenue Code for its taxable year.
(40) "Schedule C" means internal revenue service schedule C (form 1040) filed by a
taxpayer pursuant to the Internal Revenue Code.
(41) "Schedule E" means internal revenue service schedule E (form 1040) filed by a
taxpayer pursuant to the Internal Revenue Code.
(42) "Schedule F" means internal revenue service schedule F (form 1040) filed by a
taxpayer pursuant to the Internal Revenue Code.
(43) "Single member limited liability company" means a limited liability company that
has one direct member.
(44) "Small employer" means any employer that had total revenue of less than
$500,000 during the preceding taxable year. For purposes of this division, "total revenue"
means receipts of any type or kind, including, but not limited to, sales receipts; payments;
rents; profits; gains, dividends, and other investment income; compensation; commissions;
premiums; money; property; grants; contributions; donations; gifts; program service
revenue; patient service revenue; premiums; fees, including premium fees and service fees;
tuition payments; unrelated business revenue; reimbursements; any type of payment from
a governmental unit, including grants and other allocations; and any other similar receipts
reported for federal income tax purposes or under generally accepted accounting
principles. "Small employer" does not include the federal government; any state
government, including any state agency or instrumentality; any political subdivision; or any
entity treated as a government for financial accounting and reporting purposes.
(45) "Tax Administrator" means the individual charged with direct responsibility for
administration of an income tax levied by the City in accordance with this
chapter/ordinance.
(46) "Tax return preparer" means any individual described in Section 7701(a)(36) of
the Internal Revenue Code and 26 C.F.R. 301.7701-15 .
(47) "Taxable year" means the corresponding tax reporting period as prescribed for
the taxpayer under the Internal Revenue Code.
(48) (a) "Taxpayer" means a person subject to a tax levied on income by a municipal
corporation in accordance with this chapter/ordinance. "Taxpayer" does not include a
grantor trust or, except as provided in division (C)(48)(b)(i) of this section, a disregarded
entity.
(b) (i) A single member limited liability company that is a disregarded entity for
federal tax purposes may be a separate taxpayer from its single member in all Ohio
municipal corporations in which it either filed as a separate taxpayer or did not file for its
taxable year ending in 2003, if all of the following conditions are met:
(a) The limited liability company's single member is also a limited liability
company.
(b) The limited liability company and its single member were formed and doing
business in one or more Ohio municipal corporations for at least five years before January
1, 2004.
(c) Not later than December 31, 2004, the limited liability company and its single
member each made an election to be treated as a separate taxpayer under division (L) of
ORC 718.01 of this section as that section existed on December 31, 2004.
(d) The limited liability company was not formed for the purpose of evading or
reducing Ohio municipal corporation income tax liability of the limited liability company or
its single member.
(e) The Ohio municipal corporation that was the primary place of business of the
sole member of the limited liability company consented to the election.
(ii) For purposes of division (C)(48)(b)(i)(e) of this section, a municipal
corporation was the primary place of business of a limited liability company if, for the
limited liability company's taxable year ending in 2003, its income tax liability was greater
in that municipal corporation than in any other municipal corporation in Ohio, and that tax
liability to that municipal corporation for its taxable year ending in 2003 was at least
$400,000.
(49) "Taxpayers' rights and responsibilities" means the rights provided to taxpayers in
Sections 1501.09, 1501.12, 1501.13, 1501.19(B), 1501.20, 1501.21, and Sections 5717.011
and 5717.03 of the ORC, and the responsibilities of taxpayers to file, report, withhold,
remit, and pay municipal income tax and otherwise comply with Chapter 718. of the ORC
and resolutions, ordinances, and rules and regulations adopted by City for the imposition
and administration of a municipal income tax.
(50) "Video lottery terminal" has the same meaning as in Section 3770.21 of the ORC.
(51) "Video lottery terminal sales agent" means a lottery sales agent licensed under
Chapter 3770. of the ORC to conduct video lottery terminals on behalf of the state pursuant
to Section 3770.21 of the ORC.
(Ord. 2015-104. Passed 12-15-15.)
1501.03 IMPOSITION OF INCOME TAX.
The income tax levied by the City at a rate of two percent [2%] is levied on the Municipal
Taxable Income of every person residing in and/or earning and/or receiving income in the
City.
Individuals.
(A) For residents of the City, the income tax levied herein shall be on all income,
salaries, qualifying wages, commissions, and other compensation from whatever source
earned or received by the resident, including the resident's distributive share of the net
profit of pass-through entities owned directly or indirectly by the resident and any net
profit of the resident. This is further detailed in the definition of income (Section 1501.02
(C)(16)).
(B) For nonresidents, all income, salaries, qualifying wages, commissions, and other
compensation from whatever source earned or received by the nonresident for work done,
services performed or rendered, or activities conducted in the municipal corporation,
including any net profit of the nonresident, but excluding the nonresident's distributive
share of the net profit or loss of only pass-through entities owned directly or indirectly by
the nonresident.
(C) For residents and nonresidents, income can be reduced to "Municipal Taxable
Income" as defined in Section 1501.02 (C)(21). Exemptions which may apply are specified
in Section 1501.02 (C)(12).
Refundable credit for Nonqualified Deferred Compensation Plan.
(D) (1) As used in this division:
(a) "Nonqualified deferred compensation plan" means a compensation plan
described in Section 3121(v)(2)(C) of the Internal Revenue Code.
(b) "Qualifying loss" means the amount of compensation attributable to a taxpayer's
nonqualified deferred compensation plan, less the receipt of money and property
attributable to distributions from the nonqualified deferred compensation plan. Full loss is
sustained if no distribution of money and property is made by the nonqualified deferred
compensation plan. The taxpayer sustains a qualifying loss only in the taxable year in
which the taxpayer receives the final distribution of money and property pursuant to that
nonqualified deferred compensation plan.
(c) (i) "Qualifying tax rate" means the applicable tax rate for the taxable year for the
which the taxpayer paid income tax to the City with respect to any portion of the total
amount of compensation the payment of which is deferred pursuant to a nonqualified
deferred compensation plan.
(ii) If different tax rates applied for different taxable years, then the "qualifying
tax rate" is a weighted average of those different tax rates. The weighted average shall be
based upon the tax paid to the City each year with respect to the nonqualified deferred
compensation plan.
(d) "Refundable credit" means the amount of City income tax that was paid on the
non-distributed portion, if any, of a nonqualified deferred compensation plan.
(2) If, in addition to the City, a taxpayer has paid tax to other municipal corporations
with respect to the nonqualified deferred compensation plan, the amount of the credit that
a taxpayer may claim from each municipal corporation shall be calculated on the basis of
each municipal corporation's proportionate share of the total municipal corporation
income tax paid by the taxpayer to all municipal corporations with respect to the
nonqualified deferred compensation plan.
(3) In no case shall the amount of the credit allowed under this section exceed the
cumulative income tax that a taxpayer has paid to the City for all taxable years with respect
to the nonqualified deferred compensation plan.
(4) The credit allowed under this division is allowed only to the extent the
taxpayer's qualifying loss is attributable to:
(a) The insolvency or bankruptcy of the employer who had established the
nonqualified deferred compensation plan; or
(b) The employee's failure or inability to satisfy all of the employer's terms and
conditions necessary to receive the nonqualified deferred compensation.
Domicile.
(E) (1) (a) An individual is presumed to be domiciled in the City for all or part of a
taxable year if the individual was domiciled in the City on the last day of the immediately
preceding taxable year or if the Tax Administrator reasonably concludes that the individual
is domiciled in the City for all or part of the taxable year.
(b) An individual may rebut the presumption of domicile described in division
(E)(1)(a) of this section if the individual establishes by a preponderance of the evidence
that the individual was not domiciled in the City for all or part of the taxable year.
(2) For the purpose of determining whether an individual is domiciled in the City for
all or part of a taxable year, factors that may be considered include, but are not limited to,
the following:
(a) The individual's domicile in other taxable years;
(b) The location at which the individual is registered to vote;
(c) The address on the individual's driver's license;
(d) The location of real estate for which the individual claimed a property tax
exemption or reduction allowed on the basis of the individual's residence or domicile;
(e) The location and value of abodes owned or leased by the individual;
(f) Declarations, written or oral, made by the individual regarding the individual's
residency;
(g) The primary location at which the individual is employed.
(h) The location of educational institutions attended by the individual's
dependents as defined in Section 152 of the Internal Revenue Code, to the extent that
tuition paid to such educational institution is based on the residency of the individual or
the individual's spouse in the municipal corporation where the educational institution is
located;
(i) The number of contact periods the individual has with the City. For the
purposes of this division, an individual has one "contact period" with the City if the
individual is away overnight from the individual's abode located outside of the City and
while away overnight from that abode spends at least some portion, however minimal, of
each of two consecutive days in the City.
(3) All additional applicable factors are provided in the Rules and Regulations.
Businesses.
(F) This division applies to any taxpayer engaged in a business or profession in the City,
unless the taxpayer is an individual who resides in the City or the taxpayer is an electric
company, combined company, or telephone company that is subject to and required to file
reports under Chapter 5745 of the ORC.
(1) Except as otherwise provided in division (F)(2) of this section, net profit from a
business or profession conducted both within and without the boundaries of the City shall
be considered as having a taxable situs in the City for purposes of municipal income
taxation in the same proportion as the average ratio of the following:
(a) The average original cost of the real property and tangible personal property
owned or used by the taxpayer in the business or profession in the City during the taxable
period to the average original cost of all of the real and tangible personal property owned
or used by the taxpayer in the business or profession during the same period, wherever
situated.
As used in the preceding paragraph, tangible personal or real property shall include
property rented or leased by the taxpayer and the value of such property shall be
determined by multiplying the annual rental thereon by eight;
(b) Wages, salaries, and other compensation paid during the taxable period to
individuals employed in the business or profession for services performed in the City to
wages, salaries, and other compensation paid during the same period to individuals
employed in the business or profession, wherever the individual's services are performed,
excluding compensation from which taxes are not required to be withheld under Section
1501.04 (C);
(c) Total gross receipts of the business or profession from sales and rentals made
and services performed during the taxable period in the City to total gross receipts of the
business or profession during the same period from sales, rentals, and services, wherever
made or performed.
(2) (a) If the apportionment factors described in division (F)(1) of this section do not
fairly represent the extent of a taxpayer's business activity in the City, the taxpayer may
request, or the Tax Administrator of the City may require, that the taxpayer use, with
respect to all or any portion of the income of the taxpayer, an alternative apportionment
method involving one or more of the following:
(i) Separate accounting;
(ii) The exclusion of one or more of the factors;
(iii) The inclusion of one or more additional factors that would provide for a more
fair apportionment of the income of the taxpayer to the municipal corporation;
(iv) A modification of one or more of the factors.
(b) A taxpayer request to use an alternative apportionment method shall be in
writing and shall accompany a tax return, timely filed appeal of an assessment, or timely
filed amended tax return. The taxpayer may use the requested alternative method unless
the Tax Administrator denies the request in an assessment issued within the period
prescribed by Section 1501.12 (A).
(c) The Tax Administrator may require a taxpayer to use an alternative
apportionment method as described in division (F)(2)(a) of this section, but only by issuing
an assessment to the taxpayer within the period prescribed by Section 1501.12 (A).
(d) Nothing in division (F)(2) of this section nullifies or otherwise affects any
alternative apportionment arrangement approved by a the Tax Administrator or otherwise
agreed upon by both the Tax Administrator and taxpayer before January 1, 2016.
(3) As used in division (F)(1)(b) of this section, "wages, salaries, and other
compensation" includes only wages, salaries, or other compensation paid to an employee
for services performed at any of the following locations:
(a) A location that is owned, controlled, or used by, rented to, or under the
possession of one of the following:
(i) The employer;
(ii) A vendor, customer, client, or patient of the employer, or a related member of
such a vendor, customer, client, or patient;
(iii) A vendor, customer, client, or patient of a person described in (F)(3)(a)(ii) of
this section, or a related member of such a vendor, customer, client, or patient.
(b) Any location at which a trial, appeal, hearing, investigation, inquiry, review,
court-martial, or similar administrative, judicial, or legislative matter or proceeding is
being conducted, provided that the compensation is paid for services performed for, or on
behalf of, the employer or that the employee's presence at the location directly or indirectly
benefits the employer;
(c) Any other location, if the Tax Administrator determines that the employer
directed the employee to perform the services at the other location in lieu of a location
described in division (F) (3)(a) or (b) of this section solely in order to avoid or reduce the
employer's municipal income tax liability. If the Tax Administrator makes such a
determination, the employer may dispute the determination by establishing, by a
preponderance of the evidence, that the Tax Administrator's determination was
unreasonable.
(4) For the purposes of division (F)(1)(c) of this section, receipts from sales and
rentals made and services performed shall be sitused to a municipal corporation as follows:
(a) Gross receipts from the sale of tangible personal property shall be sitused to the
municipal corporation in which the sale originated. For the purposes of this division, a sale
of property originates in the City if, regardless of where title passes, the property meets any
of the following criteria:
(i) The property is shipped to or delivered within the City from a stock of goods
located within the City.
(ii) The property is delivered within the City from a location outside the City,
provided the taxpayer is regularly engaged through its own employees in the solicitation or
promotion of sales within the City and the sales result from such solicitation or promotion.
(iii) The property is shipped from a place within the City to purchasers outside the
City, provided that the taxpayer is not, through its own employees, regularly engaged in the
solicitation or promotion of sales at the place where delivery is made.
(b) Gross receipts from the sale of services shall be sitused to the City to the extent
that such services are performed in the City.
(c) To the extent included in income, gross receipts from the sale of real property
located in the City shall be sitused to the City.
(d) To the extent included in income, gross receipts from rents and royalties from
real property located in the City shall be sitused to the City.
(e) Gross receipts from rents and royalties from tangible personal property shall be
sitused to the City based upon the extent to which the tangible personal property is used in
the City.
(5) The net profit received by an individual taxpayer from the rental of real estate
owned directly by the individual, or by a disregarded entity owned by the individual, shall
be subject to the City's tax only if the property generating the net profit is located in the
City or if the individual taxpayer that receives the net profit is a resident of the City. The
City shall allow such taxpayers to elect to use separate accounting for the purpose of
calculating net profit sitused under this division to the municipal corporation in which the
property is located.
(6) (a) Commissions received by a real estate agent or broker relating to the sale,
purchase, or lease of real estate shall be sitused to the municipal corporation in which the
real estate is located. Net profit reported by the real estate agent or broker shall be
allocated to the City, if applicable, based upon the ratio of the commissions the agent or
broker received from the sale, purchase, or lease of real estate located in the City to the
commissions received from the sale, purchase, or lease of real estate everywhere in the
taxable year.
(b) An individual who is a resident of the City shall report the individual's net profit
from all real estate activity on the individual's annual tax return for the City. The individual
may claim a credit for taxes the individual paid on such net profit to another municipal
corporation to the extent that such a credit is allowed under the City's income tax
ordinance.
(7) When calculating the ratios described in division (F)(1) of this section for the
purposes of that division or division (F)(2) of this section, the owner of a disregarded
entity shall include in the owner's ratios the property, payroll, and gross receipts of such
disregarded entity.
(8) Left intentionally blank.
(9) Intentionally left blank.
(Ord. 2015-104. Passed 12-15-15.)
1501.04 COLLECTION AT SOURCE.
Withholding provisions.
(A) Each employer, agent of an employer, or other payer located or doing business in
the City shall withhold an income tax from the qualifying wages earned and/or received by
each employee in the City. Except for qualifying wages for which withholding is not
required under Section 1501.03 or division (B)(4) or (6) of this section, the tax shall be
withheld at the rate, specified in 1501.03 of this chapter/ordinance, of two percent (2%).
An employer, agent of an employer, or other payer shall deduct and withhold the tax from
qualifying wages on the date that the employer, agent, or other payer directly, indirectly, or
constructively pays the qualifying wages to, or credits the qualifying wages to the benefit
of, the employee.
(B) (1) Except as provided in division (B)(2) of this section, an employer, agent of an
employer, or other payer shall remit to the Tax Administrator of the City the greater of the
income taxes deducted and withheld or the income taxes required to be deducted and
withheld by the employer, agent, or other payer according to the following schedule:
(a) Taxes required to be deducted and withheld shall be remitted monthly to the Tax
Administrator if the total taxes deducted and withheld or required to be deducted and
withheld by the employer, agent, or other payer on behalf of the City in the preceding
calendar year exceeded $2,399, or if the total amount of taxes deducted and withheld or
required to be deducted and withheld on behalf of the City in any month of the preceding
calendar quarter exceeded $200.
Payment under division (B)(1)(a) of this section shall be made so that the payment is
received by the Tax Administrator not later than 15 days after the last day of each month
for which the tax was withheld.
(b) Any employer, agent of an employer, or other payer not required to make
payments under division (B)(1)(a) of this section of taxes required to be deducted and
withheld shall make quarterly payments to the Tax Administrator not later than the 15th
day of the month following the end of each calendar quarter.
(c) Intentionally left blank.
(2) If the employer, agent of an employer, or other payer is required to make payments
electronically for the purpose of paying federal taxes withheld on payments to employees
under Section 6302 of the Internal Revenue Code, 26 C.F.R. 31.6302-1, or any other federal
statute or regulation, the payment shall be made by electronic funds transfer to the Tax
Administrator of all taxes deducted and withheld on behalf of the City. The payment of tax
by electronic funds transfer under this division does not affect an employer's, agent's, or
other payer's obligation to file any return as required under this section.
(3) An employer, agent of an employer, or other payer shall make and file a return
showing the amount of tax withheld by the employer, agent, or other payer from the
qualifying wages of each employee and remitted to the Tax Administrator. A return filed by
an employer, agent, or other payer under this division shall be accepted by Tax
Administrator and the City as the return required of an non-resident employee whose sole
income subject to the tax under this Chapter is the qualifying wages reported by the
employee's employer, agent of an employer, or other payer.
(4) An employer, agent of an employer, or other payer is not required to withhold City
income tax with respect to an individual's disqualifying disposition of an incentive stock
option if, at the time of the disqualifying disposition, the individual is not an employee of
either the corporation with respect to whose stock the option has been issued or of such
corporation's successor entity.
(5) (a) An employee is not relieved from liability for a tax by the failure of the
employer, agent of an employer, or other payer to withhold the tax as required under this
Chapter or by the employer's, agent's, or other payer's exemption from the requirement to
withhold the tax.
(b) The failure of an employer, agent of an employer, or other payer to remit to the
City the tax withheld relieves the employee from liability for that tax unless the employee
colluded with the employer, agent, or other payer in connection with the failure to remit
the tax withheld.
(6) Compensation deferred before June 26, 2003, is not subject to City income tax or
income tax withholding requirement to the extent the deferred compensation does not
constitute qualifying wages at the time the deferred compensation is paid or distributed.
(7) Each employer, agent of an employer, or other payer required to withhold taxes is
liable for the payment of that amount required to be withheld, whether or not such taxes
have been withheld, and such amount shall be deemed to be held in trust for the City until
such time as the withheld amount is remitted to the Tax Administrator.
(8) On or before the last day of February of each year, an employer shall file a
withholding reconciliation return with the Tax Administrator listing:
(a) The names, addresses, and social security numbers of all employees from whose
qualifying wages tax was withheld or should have been withheld for the City during the
preceding calendar year;
(b) The amount of tax withheld, if any, from each such employee, the total amount of
qualifying wages paid to such employee during the preceding calendar year,;
(c) The name of every other municipal corporation for which tax was withheld or
should have been withheld from such employee during the preceding calendar yea;
(d) Any other information required for federal income tax reporting purposes on
Internal Revenue Service form W-2 or its equivalent form with respect to such employee;
(e) Other information as may be required by the Tax Administrator.
(9) The officer or the employee of the employer, agent of an employer, or other payer
with control or direct supervision of or charged with the responsibility for withholding the
tax or filing the reports and making payments as required by this section, shall be
personally liable for a failure to file a report or pay the tax due as required by this section.
The dissolution of an employer, agent of an employer, or other payer does not discharge
the officer's or employee's liability for a failure of the employer, agent of an employer, or
other payer to file returns or pay any tax due.
(10) An employer is required to deduct and withhold City income tax on tips and
gratuities received by the employer's employees and constituting qualifying wages, but
only to the extent that the tips and gratuities are under the employer's control. For the
purposes of this division, a tip or gratuity is under the employer's control if the tip or
gratuity is paid by the customer to the employer for subsequent remittance to the
employee, or if the customer pays the tip or gratuity by credit card, debit card, or other
electronic means.
(11) The Tax Administrator shall consider any tax withheld by an employer at the
request of an employee, when such tax is not otherwise required to be withheld by this
chapter/ordinance, to be tax required to be withheld and remitted for the purposes of this
section
Occasional Entrant - Withholding.
(C) (1) As used in this division:
(a) "Employer" includes a person that is a related member to or of an employer.
(b) "Fixed location" means a permanent place of doing business in this state, such as
an office, warehouse, storefront, or similar location owned or controlled by an employer.
(c) "Principal place of work" means the fixed location to which an employee is
required to report for employment duties on a regular and ordinary basis. If the employee
is not required to report for employment duties on a regular and ordinary basis to a fixed
location, "principal place of work" means the worksite location in this state to which the
employee is required to report for employment duties on a regular and ordinary basis. If
the employee is not required to report for employment duties on a regular and ordinary
basis to a fixed location or worksite location, "principal place of work" means the location
in this state at which the employee spends the greatest number of days in a calendar year
performing services for or on behalf of the employee's employer.
If there is not a single municipal corporation in which the employee spent the "greatest
number of days in a calendar year" performing services for or on behalf of the employer,
but instead there are two or more municipal corporations in which the employee spent an
identical number of days that is greater than the number of days the employee spent in any
other municipal corporation, the employer shall allocate any of the employee's qualifying
wages subject to division (C)(2)(a)(i) of this section among those two or more municipal
corporations. The allocation shall be made using any fair and reasonable method, including,
but not limited to, an equal allocation among such municipal corporations or an allocation
based upon the time spent or sales made by the employee in each such municipal
corporation. A municipal corporation to which qualifying wages are allocated under this
division shall be the employee's "principal place of work" with respect to those qualifying
wages for the purposes of this section.
For the purposes of this division, the location at which an employee spends a particular day
shall be determined in accordance with division (C)(2)(b) of this section, except that
"location" shall be substituted for "municipal corporation" wherever "municipal
corporation" appears in that division.
(d) "Professional athlete" means an athlete who performs services in a professional
athletic event for wages or other remuneration.
(e) "Professional entertainer" means a person who performs services in the
professional performing arts for wages or other remuneration on a per-event basis.
(f) "Public figure" means a person of prominence who performs services at discrete
events, such as speeches, public appearances, or similar events, for wages or other
remuneration on a per-event basis.
(g) "Worksite location" means a construction site or other temporary worksite in this
state at which the employer provides services for more than 20 days during the calendar
year. "Worksite location" does not include the home of an employee.
(2) (a) Subject to divisions (C)(3), (5), (6), and (7) of this section, an employer is not
required to withhold City income tax on qualifying wages paid to an employee for the
performance of personal services in the City if the employee performed such services in the
City on 20 or fewer days in a calendar year, unless one of the following conditions applies:
(i) The employee's principal place of work is located in the City.
(ii) The employee performed services at one or more presumed worksite locations
in the City. For the purposes of this division, "presumed worksite location" means a
construction site or other temporary worksite in the City at which the employer provides
or provided services that can reasonably be, or would have been, expected by the employer
to last more than 20 days in a calendar year. Services can "reasonably be expected by the
employer to last more than 20 days" if either of the following applies at the time the
services commence:
(a) The nature of the services are such that it will require more than 20 days of
the services to complete the services;
(b) The agreement between the employer and its customer to perform services
at a location requires the employer to perform the services at the location for more than 20
days.
(iii) The employee is a resident of the City and has requested that the employer
withhold tax from the employee's qualifying wages as provided in Section 1501.04 .
(iv) The employee is a professional athlete, professional entertainer, or public
figure, and the qualifying wages are paid for the performance of services in the employee's
capacity as a professional athlete, professional entertainer, or public figure.
(b) For the purposes of division (C)(2)(a) of this section, an employee shall be
considered to have spent a day performing services in the City only if the employee spent
more time performing services for or on behalf of the employer in the City than in any
other municipal corporation on that day. For the purposes of determining the amount of
time an employee spent in a particular location, the time spent performing one or more of
the following activities shall be considered to have been spent at the employee's principal
place of work:
(i) Traveling to the location at which the employee will first perform services for
the employer for the day;
(ii) Traveling from a location at which the employee was performing services for the
employer to any other location;
(iii) Traveling from any location to another location in order to pick up or load, for
the purpose of transportation or delivery, property that has been purchased, sold,
assembled, fabricated, repaired, refurbished, processed, remanufactured, or improved by
the employee's employer;
(iv) Transporting or delivering property described in division (C)(2)(b)(iii) of this
section, provided that, upon delivery of the property, the employee does not temporarily or
permanently affix the property to real estate owned, used, or controlled by a person other
than the employee's employer;
(v) Traveling from the location at which the employee makes the employee's final
delivery or pick-up for the day to either the employee's principal place of work or a
location at which the employee will not perform services for the employer.
(3) If the principal place of work of an employee is located in another Ohio municipal
corporation that imposes an income tax, the exception from withholding requirements
described in division (C)(2)(a) of this section shall apply only if, with respect to the
employee's qualifying wages described in that division, the employer withholds and remits
tax on such qualifying wages to that municipal corporation.
(4) (a) Except as provided in division (C)(4)(b) of this section, if, during a calendar
year, the number of days an employee spends performing personal services in the City
exceeds the 20-day threshold, the employer shall withhold and remit tax to the City for any
subsequent days in that calendar year on which the employer pays qualifying wages to the
employee for personal services performed in [Municipality/City/Village].
(b) An employer required to begin withholding tax for the City under division
(C)(4)(a) of this section may elect to withhold tax for the Cityf or the first 20 days on which
the employer paid qualifying wages to the employee for personal services performed in
[Municipality/City/Village].
(5) If an employer's fixed location is in the City and the employer qualifies as a small
employer as defined in Section 1501.02 , the employer shall withhold municipal income
tax on all of the employee's qualifying wages for a taxable year and remit that tax only to
the City, regardless of the number of days which the employee worked outside the
corporate boundaries of the City.
To determine whether an employer qualifies as a small employer for a taxable year, a the
employer will be required to provide the Tax Administrator with the employer's federal
income tax return for the preceding taxable year.
(6) Divisions (C)(2)(a) and (4) of this section shall not apply to the extent that a Tax
Administrator and an employer enter into an agreement regarding the manner in which
the employer shall comply with the requirements of Section 1501.04 .
(Ord. 2015-104. Passed 12-15-15.)
1501.05 ANNUAL RETURN; FILING.
(A) An annual City income tax return shall be completed and filed by every individual
taxpayer eighteen (18) years of age or older and any taxpayer that is not an individual for
each taxable year for which the taxpayer is subject to the tax, whether or not a tax is due
thereon.
(1) The Tax Administrator may accept on behalf of all nonresident individual
taxpayers a return filed by an employer, agent of an employer, or other payer under Section
1501.04 of this Chapter when the nonresident individual taxpayer's sole income subject to
the tax is the qualifying wages reported by the employer, agent of an employer, or other
payer, and no additional tax is due the City.
(2) Retirees having no Municipal Taxable Income for City income tax purposes may file
with the Tax Administrator a written exemption from these filing requirements on a form
prescribed by the Tax Administrator. The written exemption shall indicate the date of
retirement and the entity from which retired. The exemption shall be in effect until such
time as the retiree receives Municipal Taxable Income taxable to the City, at which time the
retiree shall be required to comply with all applicable provisions of this ordinance/chapter.
(B) If an individual is deceased, any return or notice required of that individual shall be
completed and filed by that decedent's executor, administrator, or other person charged
with the property of that decedent.
(C) If an individual is unable to complete and file a return or notice required by the City,
the return or notice required of that individual shall be completed and filed by the
individual's duly authorized agent, guardian, conservator, fiduciary, or other person
charged with the care of the person or property of that individual.
(D) Returns or notices required of an estate or a trust shall be completed and filed by
the fiduciary of the estate or trust.
(E) The City shall permit spouses to file a joint return.
(F) (1) Each return required to be filed under this division shall contain the signature
of the taxpayer or the taxpayer's duly authorized agent and of the person who prepared the
return for the taxpayer. The return shall include the taxpayer's social security number or
taxpayer identification number. Each return shall be verified by a declaration under
penalty of perjury.
(2) The Tax Administrator shall require a taxpayer who is an individual to include,
with each annual return, and amended return, copies of the following documents: all of the
taxpayer's Internal Revenue Service form W-2, "Wage and Tax Statements," including all
information reported on the taxpayer's federal W-2, as well as taxable wages reported or
withheld for any municipal corporation; the taxpayer's Internal Revenue Service form
1040; and, with respect to an amended tax return, any other documentation necessary to
support the adjustments made in the amended return. An individual taxpayer who files the
annual return required by this section electronically is not required to provide paper
copies of any of the foregoing to the Tax Administrator unless the Tax Administrator
requests such copies after the return has been filed.
(3) The Tax Administrator may require a taxpayer that is not an individual to include,
with each annual net profit return, amended net profit return, or request for refund
required under this section, copies of only the following documents: the taxpayer's Internal
Revenue Service form 1041, form 1065, form 1120, form 1120-REIT, form 1120F, or form
1120S, and, with respect to an amended tax return or refund request, any other
documentation necessary to support the refund request or the adjustments made in the
amended return.
A taxpayer that is not an individual and that files an annual net profit return electronically
through the Ohio Business Gateway or in some other manner shall either mail the
documents required under this division to the Tax Administrator at the time of filing or, if
electronic submission is available, submit the documents electronically through the Ohio
Business Gateway.
(4) After a taxpayer files a tax return, the Tax Administrator may request, and the
taxpayer shall provide, any information, statements, or documents required by the City to
determine and verify the taxpayer's municipal income tax liability. The requirements
imposed under division (F) of this section apply regardless of whether the taxpayer files on
a generic form or on a form prescribed by the Tax Administrator.
(G) (1) (a) Except as otherwise provided in this chapter/ordinance, each individual
income tax return required to be filed under this section shall be completed and filed as
required by the Tax Administrator on or before the date prescribed for the filing of state
individual income tax returns under division (G) of Section 5747.08 of the ORC. The
taxpayer shall complete and file the return or notice on forms prescribed by the Tax
Administrator or on generic forms, together with remittance made payable to the City. No
remittance is required if the net amount s due is ten dollars or less.
(b) Except as otherwise provided in this chapter/ordinance, each annual net profit
return required to be filed under this section by a taxpayer that is not an individual shall be
completed and filed as required by the Tax Administrator on or before the fifteenth day
(15th) of the fourth month following the end of the taxpayer's taxable year. The taxpayer
shall complete and file the return or notice on forms prescribed by the Tax Administrator
or on generic forms, together with remittance made payable to the City. No remittance is
required if the net amount due is ten dollars or less.
(2) Any taxpayer that has duly requested an automatic six-month extension for filing
the taxpayer's federal income tax return shall automatically receive an extension for the
filing of the City's income tax return. The extended due date of the City's income tax return
shall be the 15th day of the tenth month after the last day of the taxable year to which the
return relates. An extension of time to file under this division is not an extension of the time
to pay any tax due unless the Tax Administrator grants an extension of that date.
(a) A copy of the federal extension request shall be included with the filing of the
City's income tax return.
(b) A taxpayer that has not requested or received a six-month extension for filing the
taxpayer's federal income tax return may submit a written request that the Tax
Administrator grant the taxpayer a six-month extension of the date for filing the taxpayer's
City income tax return. If the request is received by the Tax Administrator on or before the
date the City income tax return is due, the Tax Administrator shall grant the taxpayer's
requested extension.
(3) If the tax commissioner extends for all taxpayers the date for filing state income tax
returns under division (G) of Section 5747.08 of the ORC, a taxpayer shall automatically
receive an extension for the filing of the City's income tax return. The extended due date of
the City's income tax return shall be the same as the extended due date of the state income
tax return.
(4) If the Tax Administrator considers it necessary in order to ensure the payment of
the tax imposed by the City, the Tax Administrator may require taxpayers to file returns
and make payments otherwise than as provided in this division, including taxpayers not
otherwise required to file annual returns.
(5) To the extent that any provision in this division (G) of this section conflicts with
any provision in divisions (N), (O), (P), or (Q) of this section, the provisions in divisions (N),
(O), (P), or (Q) prevail.
(H) (1) For taxable years beginning after 2015, the City shall not require a taxpayer to
remit tax with respect to net profits if the net amount due is ten dollars or less.
(2) Any taxpayer not required to remit tax to the City for a taxable year pursuant to
division (H)(1) of this section shall file with the City an annual net profit return under
division (F)(3) of this section.
(I) If a payment is required to be made by electronic funds transfer, the payment is
considered to be made when the payment is credited to an account designated by the Tax
Administrator for the receipt of tax payments, except that, when a payment made by
electronic funds transfer is delayed due to circumstances not under the control of the
taxpayer, the payment is considered to be made when the taxpayer submitted the payment.
This division shall not apply to payments required to be made under division (B)(1)(a) of
Section 1501.04 or provisions for semi-monthly withholding.
(J) Taxes withheld for the City by an employer, the agent of an employer, or other payer
as described in Section 1501.04 shall be allowed to the taxpayer as credits against
payment of the tax imposed on the taxpayer by the City, unless the amounts withheld were
not remitted to the City and the recipient colluded with the employer, agent, or other payer
in connection with the failure to remit the amounts withheld.
(K) Each return required by the City to be filed in accordance with this division shall
include a box that the taxpayer may check to authorize another person, including a tax
return preparer who prepared the return, to communicate with the Tax Administrator
about matters pertaining to the return.
(L) The Tax Administrator shall accept for filing a generic form of any income tax return,
report, or document required by the City, provided that the generic form, once completed
and filed, contains all of the information required by ordinance, resolution, or rules and
regulations adopted by the City or the Tax Administrator, and provided that the taxpayer or
tax return preparer filing the generic form otherwise complies with the provisions of this
Chapter and of the City's ordinance, resolution, or rules and regulations governing the filing
of returns, reports, or documents.
Filing via Ohio Business Gateway.
(M) (1) Any taxpayer subject to municipal income taxation with respect to the
taxpayer's net profit from a business or profession may file the City's income tax return,
estimated municipal income tax return, or extension for filing a municipal income tax
return, and may make payment of amounts shown to be due on such returns, by using the
Ohio Business Gateway.
(2) Any employer, agent of an employer, or other payer may report the amount of
municipal income tax withheld from qualifying wages, and may make remittance of such
amounts, by using the Ohio Business Gateway.
(3) Nothing in this section affects the due dates for filing employer withholding tax
returns.
Extension for service in or for the armed forces.
(N) Each member of the national guard of any state and each member of a reserve
component of the armed forces of the United States called to active duty pursuant to an
executive order issued by the president of the United States or an act of the congress of the
United States, and each civilian serving as support personnel in a combat zone or
contingency operation in support of the armed forces, may apply to the Tax Administrator
of the City for both an extension of time for filing of the return and an extension of time for
payment of taxes required by the City during the period of the member's or civilian's duty
service, and for 180 days thereafter. The application shall be filed on or before the one
hundred eightieth day after the member's or civilian's duty terminates. An applicant shall
provide such evidence as the Tax Administrator considers necessary to demonstrate
eligibility for the extension.
(O) (1) If the Tax Administrator ascertains that an applicant is qualified for an
extension under this section, the Tax Administrator shall enter into a contract with the
applicant for the payment of the tax in installments that begin on the 181st day after the
applicant's active duty or service terminates. The Tax Administrator may prescribe such
contract terms as the Tax Administrator considers appropriate. However, taxes pursuant to
a contract entered into under this division are not delinquent, and the Tax Administrator
shall not require any payments of penalties or interest in connection with those taxes for
the extension period.
(2) If the Tax Administrator determines that an applicant is qualified for an extension
under this section, the applicant shall neither be required to file any return, report, or other
tax document nor be required to pay any tax otherwise due to the municipal corporation
before the 181st day after the applicant's active duty or service terminates.
(3) Taxes paid pursuant to a contract entered into under (O)(1) of this division are not
delinquent. The Tax Administrator shall not require any payments of penalties or interest
in connection with those taxes for the extension period.
(P) (1) Nothing in this division denies to any person described in this division the
application of divisions (N) and (O) of this section.
(2) (a) A qualifying taxpayer who is eligible for an extension under the Internal
Revenue Code shall receive both an extension of time in which to file any return, report, or
other tax document and an extension of time in which to make any payment of taxes
required by a municipal corporation in accordance with this chapter/ordinance. The length
of any extension granted under division (P)(2)(a) of this section shall be equal to the length
of the corresponding extension that the taxpayer receives under the Internal Revenue
Code. As used in this division, "qualifying taxpayer" means a member of the national guard
or a member of a reserve component of the armed forces of the United States called to
active duty pursuant to either an executive order issued by the president of the United
States or an act of the congress of the United States, or a civilian serving as support
personnel in a combat zone or contingency operation in support of the armed forces.
(b) Taxes whose payment is extended in accordance with division (P)(2)(a) of this
section are not delinquent during the extension period. Such taxes become delinquent on
the first day after the expiration of the extension period if the taxes are not paid prior to
that date. The Tax Administrator shall not require any payment of penalties or interest in
connection with those taxes for the extension period. The Tax Administrator shall not
include any period of extension granted under division (C)(2)(a) of this section in
calculating the penalty or interest due on any unpaid tax.
(Q) For each taxable year to which division (N), (O), or (P) of this section applies to a
taxpayer, the provisions of divisions (O)(2) and (3) of this section, as applicable, apply to
the spouse of that taxpayer if the filing status of the spouse and the taxpayer is married
filing jointly for that year.
Consolidated municipal income tax return.
(R) As used in this section:
(1) "Affiliated group of corporations" means an affiliated group as defined in Section
1504 of the Internal Revenue Code, except that, if such a group includes at least one
incumbent local exchange carrier that is primarily engaged in the business of providing
local exchange telephone service in this state, the affiliated group shall not include any
incumbent local exchange carrier that would otherwise be included in the group.
(2) "Consolidated federal income tax return" means a consolidated return filed for
federal income tax purposes pursuant to Section 1501 of the Internal Revenue Code.
(3) "Consolidated federal taxable income" means the consolidated taxable income of
an affiliated group of corporations, as computed for the purposes of filing a consolidated
federal income tax return, before consideration of net operating losses or special
deductions. "Consolidated federal taxable income" does not include income or loss of an
incumbent local exchange carrier that is excluded from the affiliated group under division
(R)(1) of this section.
(4) "Incumbent local exchange carrier" has the same meaning as in Section 4927.01 of
the ORC.
(5) "Local exchange telephone service" has the same meaning as in Section 5727.01 of
the ORC.
(S) (1) For taxable years beginning on or after January 1, 2016, a taxpayer that is a
member of an affiliated group of corporations may elect to file a consolidated municipal
income tax return for a taxable year if at least one member of the affiliated group of
corporations is subject to the City's income tax in that taxable year, and if the affiliated
group of corporations filed a consolidated federal income tax return with respect to that
taxable year. The election is binding for a five-year period beginning with the first taxable
year of the initial election unless a change in the reporting method is required under
federal law. The election continues to be binding for each subsequent five-year period
unless the taxpayer elects to discontinue filing consolidated municipal income tax returns
under division (S)(2) of this section or a taxpayer receives permission from the Tax
Administrator. The Tax Administrator shall approve such a request for good cause shown.
(2) An election to discontinue filing consolidated municipal income tax returns under
this section must be made in the first year following the last year of a five-year consolidated
municipal income tax return election period in effect under division (S)(1) of this section.
The election to discontinue filing a consolidated municipal income tax return is binding for
a five-year period beginning with the first taxable year of the election.
(3) An election made under division (S)(1) or (2) of this section is binding on all
members of the affiliated group of corporations subject to a municipal income tax.
(T) A taxpayer that is a member of an affiliated group of corporations that filed a
consolidated federal income tax return for a taxable year shall file a consolidated City
income tax return for that taxable year if the Tax Administrator determines, by a
preponderance of the evidence, that intercompany transactions have not been conducted at
arm's length and that there has been a distortive shifting of income or expenses with
regard to allocation of net profits to the City. A taxpayer that is required to file a
consolidated City income tax return for a taxable year shall file a consolidated City income
tax return for all subsequent taxable years, unless the taxpayer requests and receives
written permission from the Tax Administrator to file a separate return or a taxpayer has
experienced a change in circumstances.
(U) A taxpayer shall prepare a consolidated City income tax return in the same manner
as is required under the United States department of treasury regulations that prescribe
procedures for the preparation of the consolidated federal income tax return required to be
filed by the common parent of the affiliated group of which the taxpayer is a member.
(V) (1) Except as otherwise provided in divisions (V)(2), (3), and (4) of this section,
corporations that file a consolidated municipal income tax return shall compute adjusted
federal taxable income, as defined in Section 1501.02 , by substituting "consolidated
federal taxable income" for "federal taxable income" wherever "federal taxable income"
appears in that division and by substituting "an affiliated group of corporation's" for "a C
corporation's" wherever "a C corporation's" appears in that division.
(2) No corporation filing a consolidated City income tax return shall make any
adjustment otherwise required under Section (2)(C)(1) to the extent that the item of
income or deduction otherwise subject to the adjustment has been eliminated or
consolidated in the computation of consolidated federal taxable income.
(3) If the net profit or loss of a pass-through entity having at least eighty percent
(80%) of the value of its ownership interest owned or controlled, directly or indirectly, by
an affiliated group of corporations is included in that affiliated group's consolidated federal
taxable income for a taxable year, the corporation filing a consolidated City income tax
return shall do one of the following with respect to that pass-through entity's net profit or
loss for that taxable year:
(a) Exclude the pass-through entity's net profit or loss from the consolidated federal
taxable income of the affiliated group and, for the purpose of making the computations
required in divisions (R) through (Y) of Section 1501.05 , exclude the property, payroll,
and gross receipts of the pass-through entity in the computation of the affiliated group's
net profit sitused to the City. If the entity's net profit or loss is so excluded, the entity shall
be subject to taxation as a separate taxpayer on the basis of the entity's net profits that
would otherwise be included in the consolidated federal taxable income of the affiliated
group.
(b) Include the pass-through entity's net profit or loss in the consolidated federal
taxable income of the affiliated group and, for the purpose of making the computations
required in divisions (R) through (Y) of Section 1501.05 , include the property, payroll, and
gross receipts of the pass-through entity in the computation of the affiliated group's net
profit sitused to the City. If the entity's net profit or loss is so included, the entity shall not
be subject to taxation as a separate taxpayer on the basis of the entity's net profits that are
included in the consolidated federal taxable income of the affiliated group.
(4) If the net profit or loss of a pass-through entity having less than eighty percent of
the value of its ownership interest owned or controlled, directly or indirectly, by an
affiliated group of corporations is included in that affiliated group's consolidated federal
taxable income for a taxable year, all of the following shall apply:
(a) The corporation filing the consolidated municipal income tax return shall exclude
the pass-through entity's net profit or loss from the consolidated federal taxable income of
the affiliated group and, for the purposes of making the computations required in divisions
(R) through (Y) of Section 1501.05, exclude the property, payroll, and gross receipts of the
pass-through entity in the computation of the affiliated group's net profit sitused to the
City;
(b) The pass-through entity shall be subject to City income taxation as a separate
taxpayer in accordance with this Chapter on the basis of the entity's net profits that would
otherwise be included in the consolidated federal taxable income of the affiliated group.
(W) Corporations filing a consolidated City income tax return shall make the
computations required under divisions (R) through (Y) of Section 1501.05 by substituting
"consolidated federal taxable income attributable to" for "net profit from" wherever "net
profit from" appears in that section and by substituting "affiliated group of corporations"
for "taxpayer" wherever "taxpayer" appears in that section.
(X) Each corporation filing a consolidated City income tax return is jointly and severally
liable for any tax, interest, penalties, fines, charges, or other amounts imposed by the City in
accordance with this Chapter on the corporation, an affiliated group of which the
corporation is a member for any portion of the taxable year, or any one or more members
of such an affiliated group.
(Y) Corporations and their affiliates that made an election or entered into an agreement
with City before January 1, 2016, to file a consolidated or combined tax return with City
may continue to file consolidated or combined tax returns in accordance with such election
or agreement for taxable years beginning on and after January 1, 2016.
(Ord. 2015-104. Passed 12-15-15.)
1501.06 CREDIT FOR TAX PAID TO OTHER MUNICIPALITIES.
(A) Every individual taxpayer domiciled in the City who is required to and does pay, or
has acknowledged liability for, a municipal tax to another municipality on or measured by
the same income, qualifying wages, commissions, net profits or other compensation taxable
under this Chapter may claim a nonrefundable credit upon satisfactory evidence of the tax
paid to the other municipality. Subject to division (C) of this section, the credit shall not
exceed the tax due the City under this chapter/ordinance.
(B) The City shall grant a credit against its tax on income to a resident of the City who
works in a joint economic development zone created under Section 715.691 or a joint
economic development district created under Section 715.70, 715.71, or 715.72 of the ORC
to the same extent that it grants a credit against its tax on income to its residents who are
employed in another municipal corporation.
(C) If the amount of tax withheld or paid to the other municipality is less than the
amount of tax required to be withheld or paid to the other municipality, then for purposes
of division (A) of this section, "the income, qualifying wages, commissions, net profits or
other compensation" subject to tax in the other municipality shall be limited to the amount
computed by dividing the tax withheld or paid to the other municipality by the tax rate for
that municipality.
(D) Intentionally left blank.
(Ord. 2015-104. Passed 12-15-15.)
1501.07 ESTIMATED TAXES.
(A) As used in this section:
(1) "Estimated taxes" means the amount that the taxpayer reasonably estimates to be
the taxpayer's tax liability for the City's income tax for the current taxable year.
(2) "Tax liability" means the total taxes due to the City for the taxable year, after
allowing any credit to which the taxpayer is entitled, and after applying any estimated tax
payment, withholding payment, or credit from another taxable year.
(B) (1) Every taxpayer shall make a declaration of estimated taxes for the current
taxable year, on the form prescribed by the Tax Administrator, if the amount payable as
estimated taxes is at least $200. For the purposes of this section:
(a) Taxes withheld for the City from qualifying wages shall be considered as paid to
the City in equal amounts on each payment date unless the taxpayer establishes the dates
on which all amounts were actually withheld, in which case they shall be considered as
paid on the dates on which the amounts were actually withheld.
(b) An overpayment of tax applied as a credit to a subsequent taxable year is deemed
to be paid on the date of the postmark stamped on the cover in which the payment is
mailed or, if the payment is made by electronic funds transfer, the date the payment is
submitted. As used in this division, "date of the postmark" means, in the event there is
more than one date on the cover, the earliest date imprinted on the cover by the postal
service.
(2) Taxpayers filing joint returns shall file joint declarations of estimated taxes. A
taxpayer may amend a declaration under rules prescribed by the Tax Administrator. A
taxpayer having a taxable year of less than twelve months shall make a declaration under
rules prescribed by the Tax Administrator.
(3) The declaration of estimated taxes shall be filed on or before the date prescribed
for the filing of municipal income tax returns under division (G) of Section 1501.05 or on or
before the fifteenth (15th) day of the fourth month after the taxpayer becomes subject to
tax for the first time.
(4) Taxpayers reporting on a fiscal year basis shall file a declaration on or before the
fifteenth (15th) day of the fourth month after the beginning of each fiscal year or period.
(5) The original declaration or any subsequent amendment may be increased or
decreased on or before any subsequent quarterly payment day as provided in this section.
(C) (1) The required portion of the tax liability for the taxable year that shall be paid
through estimated taxes made payable to the City, including the application of tax refunds
to estimated taxes and withholding on or before the applicable payment date, shall be as
follows:
(a) On or before the fifteenth (15th) day of the fourth month after the beginning of
the taxable year, twenty-two and one-half (22.5) percent of the tax liability for the taxable
year;
(b) On or before the fifteenth (15th) day of the sixth month after the beginning of the
taxable year, forty-five (45) percent of the tax liability for the taxable year;
(c) On or before the fifteenth (15th) day of the ninth month after the beginning of the
taxable year, sixty-seven and one-half (67.5) percent of the tax liability for the taxable year;
(d) On or before the fifteenth (15th) day of the twelfth month of the taxable year,
ninety percent (90%) of the tax liability for the taxable year.
(2) When an amended declaration has been filed, the unpaid balance shown due on the
amended declaration shall be paid in equal installments on or before the remaining
payment dates.
(3) On or before the fifteenth (15th) day of the fourth month of the year following that
for which the declaration or amended declaration was filed, an annual return shall be filed
and any balance which may be due shall be paid with the return in accordance with Section
1501.05 .
(D) (1) In the case of any underpayment of any portion of a tax liability, penalty and
interest may be imposed pursuant to Section 1501.01 upon the amount of underpayment
for the period of underpayment, unless the underpayment is due to reasonable cause as
described in division (E) of this section. The amount of the underpayment shall be
determined as follows:
(a) For the first payment of estimated taxes each year, twenty-two and one-half
percent (22.5%) of the tax liability, less the amount of taxes paid by the date prescribed for
that payment;
(b) For the second payment of estimated taxes each year, forty-five percent (45%) of
the tax liability, less the amount of taxes paid by the date prescribed for that payment;
(c) For the third payment of estimated taxes each year, sixty-seven and one-half
percent (67.5%) of the tax liability, less the amount of taxes paid by the date prescribed for
that payment;
(d) For the fourth payment of estimated taxes each year, ninety percent (90%) of the
tax liability, less the amount of taxes paid by the date prescribed for that payment.
(2) The period of the underpayment shall run from the day the estimated payment was
required to be made to the date on which the payment is made. For purposes of this
section, a payment of estimated taxes on or before any payment date shall be considered a
payment of any previous underpayment only to the extent the payment of estimated taxes
exceeds the amount of the payment presently required to be paid to avoid any penalty.
(E) An underpayment of any portion of tax liability determined under division (D) of
this section shall be due to reasonable cause and the penalty imposed by this section shall
not be added to the taxes for the taxable year if any of the following apply:
(1) The amount of estimated taxes that were paid equals at least ninety percent (90%)
of the tax liability for the current taxable year, determined by annualizing the income
received during the year up to the end of the month immediately preceding the month in
which the payment is due.
(2) The amount of estimated taxes that were paid equals at least one hundred percent
of the tax liability shown on the return of the taxpayer for the preceding taxable year,
provided that the immediately preceding taxable year reflected a period of twelve months
and the taxpayer filed a return with the City under Section 1501.05 for that year.
(3) The taxpayer is an individual who resides in the City but was not domiciled there
on the first day of January of the calendar year that includes the first day of the taxable
year.
(Ord. 2015-104. Passed 12-15-15.)
1501.08 ROUNDING OF AMOUNTS.
A person may round to the nearest whole dollar all amounts the person is required to
enter on any return, report, voucher, or other document required under this
chapter/ordinance. Any fractional part of a dollar that equals or exceeds fifty cents shall be
rounded to the next whole dollar, and any fractional part of a dollar that is less than fifty
cents shall be dropped. If a person chooses to round amounts entered on a document, the
person shall round all amounts entered on the document.
(Ord. 2015-104. Passed 12-15-15.)
1501.09 REQUESTS FOR REFUNDS.
(A) As used in this section, "withholding tax" has the same meaning as in Section
1501.18 .
(B) Upon receipt of a request for a refund, the Tax Administrator, in accordance with
this section, shall refund to employers, agents of employers, other payers, or taxpayers,
with respect to any income or withholding tax levied by the municipal corporation:
(1) Overpayments of ten dollars or more;
(2) Amounts paid erroneously if the refund requested is ten dollars or more.
(C) (1) Except as otherwise provided in this chapter/ordinance, requests for refund
shall be filed with the Tax Administrator, on the form prescribed by the Tax Administrator
within three years after the tax was due or paid, whichever is later. The Tax Administrator
may require the requestor to file with the request any documentation that substantiates
the requestor's claim for a refund.
(2) On filing of the refund request, the Tax Administrator shall determine the amount
of refund due and certify such amount to the appropriate municipal corporation official for
payment. Except as provided in division (C)(3) of this section, the administrator shall issue
an assessment to any taxpayer whose request for refund is fully or partially denied. The
assessment shall state the amount of the refund that was denied, the reasons for the denial,
and instructions for appealing the assessment.
(3) If a Tax Administrator denies in whole or in part a refund request included within
the taxpayer's originally filed annual income tax return, the Tax Administrator shall notify
the taxpayer, in writing, of the amount of the refund that was denied, the reasons for the
denial, and instructions for requesting an assessment that may be appealed under Section
1501.21 .
(D) A request for a refund that is received after the last day for filing specified in
division (C) of this section shall be considered to have been filed in a timely manner if any
of the following situations exist:
(1) The request is delivered by the postal service, and the earliest postal service
postmark on the cover in which the request is enclosed is not later than the last day for
filing the request.
(2) The request is delivered by the postal service, the only postmark on the cover in
which the request is enclosed was affixed by a private postal meter, the date of that
postmark is not later than the last day for filing the request, and the request is received
within seven days of such last day.
(3) The request is delivered by the postal service, no postmark date was affixed to the
cover in which the request is enclosed or the date of the postmark so affixed is not legible,
and the request is received within seven days of the last day for making the request.
(E) Interest shall be allowed and paid on any overpayment by a taxpayer of any
municipal income tax obligation from the date of the overpayment until the date of the
refund of the overpayment, except that if any overpayment is refunded within 90 days after
the final filing date of the annual return or 90 days after the completed return is filed,
whichever is later, no interest shall be allowed on the refund. For the purpose of computing
the payment of interest on amounts overpaid, no amount of tax for any taxable year shall
be considered to have been paid before the date on which the return on which the tax is
reported is due, without regard to any extension of time for filing that return. Interest shall
be paid at the interest rate described in Section 1501.18 (A)(4).
(Ord. 2015-104. Passed 12-15-15.)
1501.10 SECOND MUNICIPALITY IMPOSING TAX AFTER TIME PERIOD ALLOWED FOR
REFUND.
(A) Income tax that has been deposited with the City, but should have been deposited
with another municipality, is allowable by the City as a refund but is subject to the three-
year limitation on refunds.
(B) Income tax that was deposited with another municipality but should have been
deposited with the City is subject to recovery by the City. If the City's tax on that income is
imposed after the time period allowed for a refund of the tax or withholding paid to the
other municipality, the City shall allow a nonrefundable credit against the tax or
withholding City claims is due with respect to such income or wages, equal to the tax or
withholding paid to the first municipality with respect to such income or wages.
(C) If the City's tax rate is less than the tax rate in the other municipality, then the
nonrefundable credit shall be calculated using the City's tax rate. However, if the City's tax
rate is greater than the tax rate in the other municipality, the tax due in excess of the
nonrefundable credit is to be paid to the City, along with any penalty and interest that
accrued during the period of nonpayment.
(D) Nothing in this section permits any credit carryforward.
(Ord. 2015-104. Passed 12-15-15.)
1501.11 AMENDED RETURNS.
(A) (1) If a taxpayer's tax liability shown on the annual tax return for the City changes
as a result of an adjustment to the taxpayer's federal or state income tax return, the
taxpayer shall file an amended return with the City. The amended return shall be filed on a
form required by the Tax Administrator.
(2) If a taxpayer intends to file an amended consolidated municipal income tax return,
or to amend its type of return from a separate return to a consolidated return, based on the
taxpayer's consolidated federal income tax return, the taxpayer shall notify the Tax
Administrator before filing the amended return.
(B) (1) In the case of an underpayment, the amended return shall be accompanied by
payment of any combined additional tax due, together with any penalty and interest
thereon. If the combined tax shown to be due is ten dollars or less, no payment need be
made. The amended return shall reopen those facts, figures, computations, or attachments
from a previously filed return that are not affected, either directly or indirectly, by the
adjustment to the taxpayer's federal or state income tax return only:
(i) To determine the amount of tax that would be due if all facts, figures,
computations, and attachments were reopened; or,
(ii) If the applicable statute of limitations for civil actions or prosecutions under
Section 1501.12 has not expired for a previously filed return.
(2) The additional tax to be paid shall not exceed the amount of tax that would be due
if all facts, figures, computations, and attachments were reopened; i.e., the payment shall be
the lesser of the two amounts.
(C) (1) In the case of an overpayment, a request for refund may be filed under this
division within the period prescribed by division (D) of this section for filing the amended
return, even if it is filed beyond the period prescribed in that division if it otherwise
conforms to the requirements of that division. If the amount of the refund is less than ten
dollars, no refund need be paid by the City. A request filed under this division shall claim
refund of overpayments resulting from alterations only to those facts, figures,
computations, or attachments required in the taxpayer's annual return that are affected,
either directly or indirectly, by the adjustment to the taxpayer's federal or state income tax
return, unless it is also filed within the time prescribed in Section 1501.09 .
(2) The amount to be refunded shall not exceed the amount of refund that would be
due if all facts, figures, computations, and attachments were reopened. All facts, figures,
computations, and attachments may be reopened to determine the refund amount due by
inclusion of all facts, figures, computations, and attachments.
(D) Within 60 days after the final determination of any federal or state tax liability
affecting the taxpayer's City's tax liability, that taxpayer shall make and file an amended
City return showing income subject to City income tax based upon such final determination
of federal or state tax liability. The taxpayer shall pay any additional City income tax shown
due thereon or make a claim for refund of any overpayment, unless the tax or overpayment
is less than ten dollars.
(Ord. 2015-104. Passed 12-15-15.)
1501.12 LIMITATIONS.
(A) (1) (a) Civil actions to recover municipal income taxes and penalties and interest
on municipal income taxes shall be brought within the later of:
(i) Three years after the tax was due or the return was filed, whichever is later; or
(ii) One year after the conclusion of the qualifying deferral period, if any.
(b) The time limit described in division (A)(1)(a) of this section may be extended at
any time if both the Tax Administrator and the employer, agent of the employer, other
payer, or taxpayer consent in writing to the extension. Any extension shall also extend for
the same period of time the time limit described in division (C) of this section.
(2) As used in this section, "qualifying deferral period" means a period of time
beginning and ending as follows:
(a) Beginning on the date a person who is aggrieved by an assessment files with the
Board of Tax Review the request described in Section 1501.21 . That date shall not be
affected by any subsequent decision, finding, or holding by any administrative body or
court that the Board of Tax Review did not have jurisdiction to affirm, reverse, or modify
the assessment or any part of that assessment.
(b) Ending the later of the sixtieth day after the date on which the final determination
of the Board of Tax Review becomes final or, if any party appeals from the determination of
the Board of Tax Review, the sixtieth day after the date on which the final determination of
the Board of Tax Review is either ultimately affirmed in whole or in part or ultimately
reversed and no further appeal of either that affirmation, in whole or in part, or that
reversal is available or taken.
(B) Prosecutions for an offense made punishable under a resolution or ordinance
imposing an income tax shall be commenced within three years after the commission of the
offense, provided that in the case of fraud, failure to file a return, or the omission of twenty-
five percent (25%) or more of income required to be reported, prosecutions may be
commenced within six years after the commission of the offense.
(C) A claim for a refund of municipal income taxes shall be brought within the time
limitation provided in Section 1501.09 .
(D) (1) Notwithstanding the fact that an appeal is pending, the petitioner may pay all or
a portion of the assessment that is the subject of the appeal. The acceptance of a payment
by the City does not prejudice any claim for refund upon final determination of the appeal.
(2) If upon final determination of the appeal an error in the assessment is corrected by
the Tax Administrator, upon an appeal so filed or pursuant to a final determination of the
Board of Tax Review, of the Ohio board of tax appeals, or any court to which the decision of
the Ohio board of tax appeals has been appealed, so that the resultant amount due is less
than the amount paid, a refund will be paid in the amount of the overpayment as provided
by Section 1501.09 , with interest on that amount as provided by division (E) of Section
1501.09 .
(E) No civil action to recover City income tax or related penalties or interest shall be
brought during either of the following time periods:
(1) The period during which a taxpayer has a right to appeal the imposition of that tax
or interest or those penalties;
(2) The period during which an appeal related to the imposition of that tax or interest
or those penalties is pending.
(Ord. 2015-104. Passed 12-15-15.)
1501.13 AUDITS.
(A) At or before the commencement of an audit, the Tax Administrator shall provide to
the taxpayer a written description of the roles of the Tax Administrator and of the taxpayer
during the audit and a statement of the taxpayer's rights, including any right to obtain a
refund of an overpayment of a tax. At or before the commencement of an audit, the Tax
Administrator shall inform the taxpayer when the audit is considered to have commenced.
(B) Except in cases involving suspected criminal activity, the Tax Administrator shall
conduct an audit of a taxpayer during regular business hours and after providing
reasonable notice to the taxpayer. A taxpayer who is unable to comply with a proposed
time for an audit on the grounds that the proposed time would cause inconvenience or
hardship must offer reasonable alternative dates for the audit.
(C) At all stages of an audit by the Tax Administrator, a taxpayer is entitled to be
assisted or represented by an attorney, accountant, bookkeeper, or other tax practitioner.
The Tax Administrator shall prescribe a form by which a taxpayer may designate such a
person to assist or represent the taxpayer in the conduct of any proceedings resulting from
actions by the Tax Administrator. If a taxpayer has not submitted such a form, the Tax
Administrator may accept other evidence, as the Tax Administrator considers appropriate,
that a person is the authorized representative of a taxpayer.
A taxpayer may refuse to answer any questions asked by the person conducting an audit
until the taxpayer has an opportunity to consult with the taxpayer's attorney, accountant,
bookkeeper, or other tax practitioner.
This division does not authorize the practice of law by a person who is not an attorney.
(D) A taxpayer may record, electronically or otherwise, the audit examination.
(E) The failure of the Tax Administrator to comply with a provision of this section shall
neither excuse a taxpayer from payment of any taxes owed by the taxpayer nor cure any
procedural defect in a taxpayer's case.
(F) If the Tax Administrator fails to substantially comply with the provisions of this
section, the Tax Administrator, upon application by the taxpayer, shall excuse the taxpayer
from penalties and interest.
(Ord. 2015-104. Passed 12-15-15.)
1501.14 SERVICE OF ASSESSMENT.
(A) As used in this section:
(1) "Last known address" means the address the Tax Administrator has at the time a
document is originally sent by certified mail, or any address the Tax Administrator can
ascertain using reasonable means such as the use of a change of address service offered by
the postal service or an authorized delivery service under Section 5703.056 of the ORC.
(2) "Undeliverable address" means an address to which the postal service or an
authorized delivery service under Section 5703.056 of the ORC is not able to deliver an
assessment of the Tax Administrator, except when the reason for non-delivery is because
the addressee fails to acknowledge or accept the assessment.
(B) Subject to division (C) of this section, a copy of each assessment shall be served
upon the person affected thereby either by personal service, by certified mail, or by a
delivery service authorized under Section 5703.056 of the ORC. With the permission of the
person affected by an assessment, the Tax Administrator may deliver the assessment
through alternative means as provided in this section, including, but not limited to, delivery
by secure electronic mail.
(C) (1) (a) If certified mail is returned because of an undeliverable address, a Tax
Administrator shall utilize reasonable means to ascertain a new last known address,
including the use of a change of address service offered by the postal service or an
authorized delivery service under Section 5703.056 of the ORC. If the Tax Administrator is
unable to ascertain a new last known address, the assessment shall be sent by ordinary
mail and considered served. If the ordinary mail is subsequently returned because of an
undeliverable address, the assessment remains appealable within 60 days after the
assessment's postmark.
(b) Once the Tax Administrator or other City official, or the designee of either, serves
an assessment on the person to whom the assessment is directed, the person may protest
the ruling of that assessment by filing an appeal with the local board of tax review within
60 days after the receipt of service. The delivery of an assessment of the Tax Administrator
under division (C)(1)(a) of this section is prima facie evidence that delivery is complete and
that the assessment is served.
(2) If mailing of an assessment by a Tax Administrator by certified mail is returned for
some cause other than an undeliverable address, the Tax Administrator shall resend the
assessment by ordinary mail. The assessment shall show the date the Tax Administrator
sends the assessment and include the following statement:
"This assessment is deemed to be served on the addressee under applicable law ten days
from the date this assessment was mailed by the Tax Administrator as shown on the
assessment, and all periods within which an appeal may be filed apply from and after that
date."
Unless the mailing is returned because of an undeliverable address, the mailing of that
information is prima facie evidence that delivery of the assessment was completed ten days
after the Tax Administrator sent the assessment by ordinary mail and that the assessment
was served.
If the ordinary mail is subsequently returned because of an undeliverable address, the Tax
Administrator shall proceed under division (C)(1)(a) of this section. A person may
challenge the presumption of delivery and service under this division in accordance with
division (D) of this section.
(D) (1) A person disputing the presumption of delivery and service under division (C)
of this section bears the burden of proving by a preponderance of the evidence that the
address to which the assessment was sent by certified mail was not an address with which
the person was associated at the time the Tax Administrator originally mailed the
assessment. For the purposes of this section, a person is associated with an address at the
time the Tax Administrator originally mailed the assessment if, at that time, the person was
residing, receiving legal documents, or conducting business at the address; or if, before that
time, the person had conducted business at the address and, when the assessment was
mailed, the person's agent or the person's affiliate was conducting business at the address.
For the purposes of this section, a person's affiliate is any other person that, at the time the
assessment was mailed, owned or controlled at least 20 percent, as determined by voting
rights, of the addressee's business.
(2) If a person elects to appeal an assessment on the basis described in division (D)(1)
of this section, and if that assessment is subject to collection and is not otherwise
appealable, the person must do so within 60 days after the initial contact by the Tax
Administrator or other City official, or the designee of either, with the person. Nothing in
this division prevents the Tax Administrator or other official from entering into a
compromise with the person if the person does not actually file such an appeal with the
local board of tax review.
(E) Nothing in this section prohibits the Tax Administrator or the Tax Administrator's
designee from delivering an assessment by a Tax Administrator by personal service.
(F) Collection actions taken upon any assessment being appealed under division
(C)(1)(b) of this section, including those on which a claim has been delivered for collection,
shall be stayed upon the pendency of an appeal under this section.
(G) Additional regulations as detailed in the Rules and Regulations shall apply.
(Ord. 2015-104. Passed 12-15-15.)
1501.15 ADMINISTRATION OF CLAIMS.
(A) As used in this section, "claim" means a claim for an amount payable to the City that
arises pursuant to the City's income tax imposed in accordance with this
chapter/ordinance.
(B) Nothing in this Chapter prohibits a Tax Administrator from doing either of the
following if such action is in the best interests of the municipal corporation:
(1) Compromise a claim;
(2) Extend for a reasonable period the time for payment of a claim by agreeing to
accept monthly or other periodic payments.
(C) The Tax Administrator's rejection of a compromise or payment-over-time
agreement proposed by a person with respect to a claim shall not be appealable.
(D) A compromise or payment-over-time agreement with respect to a claim shall be
binding upon and shall be to the benefit of only the parties to the compromise or
agreement, and shall not eliminate or otherwise affect the liability of any other person.
(E) A compromise or payment-over-time agreement with respect to a claim shall be void
if the taxpayer defaults under the compromise or agreement or if the compromise or
agreement was obtained by fraud or by misrepresentation of a material fact. Any amount
that was due before the compromise or agreement and that is unpaid shall remain due, and
any penalties or interest that would have accrued in the absence of the compromise or
agreement shall continue to accrue and be due.
(Ord. 2015-104. Passed 12-15-15.)
1501.16 TAX INFORMATION CONFIDENTIAL.
(A) Any information gained as a result of returns, investigations, hearings, or
verifications required or authorized by this Chapter is confidential, and no person shall
access or disclose such information except in accordance with a proper judicial order or in
connection with the performance of that person's official duties or the official business of
the City as authorized by this chapter/ordinance. The Tax Administrator or a designee
thereof may furnish copies of returns filed or otherwise received under this Chapter and
other related tax information to the internal revenue service, the tax commissioner, and tax
administrators of other municipal corporations.
(B) This section does not prohibit the City from publishing or disclosing statistics in a
form that does not disclose information with respect to particular taxpayers.
(Ord. 2015-104. Passed 12-15-15.)
1501.17 FRAUD.
No person shall knowingly make, present, aid, or assist in the preparation or presentation
of a false or fraudulent report, return, schedule, statement, claim, or document authorized
or required by City ordinance or state law to be filed with a the Tax Administrator, or
knowingly procure, counsel, or advise the preparation or presentation of such report,
return, schedule, statement, claim, or document, or knowingly change, alter, or amend, or
knowingly procure, counsel or advise such change, alteration, or amendment of the records
upon which such report, return, schedule, statement, claim, or document is based with
intent to defraud the City or the Tax Administrator.
(Ord. 2015-104. Passed 12-15-15.)
1501.18 INTEREST AND PENALTIES.
(A) As used in this section:
(1) "Applicable law" means this chapter/ordinance, the resolutions, ordinances,
codes, directives, instructions, and rules adopted by the City provided they impose or
directly or indirectly address the levy, payment, remittance, or filing requirements of the
City.
(2) "Federal short-term rate" means the rate of the average market yield on
outstanding marketable obligations of the United States with remaining periods to
maturity of three years or less, as determined under Section 1274 of the Internal Revenue
Code, for July of the current year.
(3) "Income tax," "estimated income tax," and "withholding tax" means any income tax,
estimated income tax, and withholding tax imposed by the City pursuant to applicable law,
including at any time before January 1, 2016.
(4) "Interest rate as described in division (A) of this section" means the federal short-
term rate, rounded to the nearest whole number percent, plus five percent. The rate shall
apply for the calendar year next following the July of the year in which the federal short-
term rate is determined in accordance with division (A)(2) of this section.
(5) "Return" includes any tax return, report, reconciliation, schedule, and other
document required to be filed with the Tax Administrator or the City by a taxpayer,
employer, any agent of the employer, or any other payer pursuant to applicable law,
including at any time before January 1, 2016.
(6) "Unpaid estimated income tax" means estimated income tax due but not paid by
the date the tax is required to be paid under applicable law.
(7) "Unpaid income tax" means income tax due but not paid by the date the income tax
is required to be paid under applicable law.
(8) "Unpaid withholding tax" means withholding tax due but not paid by the date the
withholding tax is required to be paid under applicable law.
(9) "Withholding tax" includes amounts an employer, any agent of an employer, or any
other payer did not withhold in whole or in part from an employee's qualifying wages, but
that, under applicable law, the employer, agent, or other payer is required to withhold from
an employee's qualifying wages.
(B) (1) This section applies to the following:
(a) Any return required to be filed under applicable law for taxable years beginning
on or after January 1, 2016;
(b) Income tax, estimated income tax, and withholding tax required to be paid or
remitted to City on or after January 1, 2016.
(2) This section does not apply to returns required to be filed or payments required to
be made before January 1, 2016, regardless of the filing or payment date. Returns required
to be filed or payments required to be made before January 1, 2016, but filed or paid after
that date shall be subject to the ordinances or rules and regulations, as adopted before
January 1, 2016, of the City to which the return is to be filed or the payment is to be made.
(C) Should any taxpayer, employer, agent of the employer, or other payer for any reason
fails, in whole or in part, to make timely and full payment or remittance of income tax,
estimated income tax, or withholding tax or to file timely with the City any return required
to be filed, the following penalties and interest shall apply:
(1) Interest shall be imposed at the rate described in division (A) of this section, per
annum, on all unpaid income tax, unpaid estimated income tax, and unpaid withholding tax.
(2) (a) With respect to unpaid income tax and unpaid estimated income tax, the City
may impose a penalty equal to fifteen percent (15%) of the amount not timely paid.
(b) With respect to any unpaid withholding tax, the City may impose a penalty equal
to fifty percent (50%) of the amount not timely paid.
(3) With respect to returns other than estimated income tax returns, the City may
impose a penalty of $25 for each failure to timely file each return, regardless of the liability
shown thereon for each month, or any fraction thereof, during which the return remains
unfiled regardless of the liability shown thereon. The penalty shall not exceed $150 for
each failure.
(D) Nothing in this section requires the City to refund or credit any penalty, amount of
interest, charges, or additional fees that the City has properly imposed or collected before
January 1, 2016.
(E) Nothing in this section limits the authority of the City to abate or partially abate
penalties or interest imposed under this section when the Tax Administrator determines,
in the Tax Administrator's sole discretion, that such abatement is appropriate.
(F) By the 31st day of October of each year the City shall publish the rate described in
division (A) of this section applicable to the next succeeding calendar year.
(G) The City may impose on the taxpayer, employer, any agent of the employer, or any
other payer the City's post-judgment collection costs and fees, including attorney's fees.
(Ord. 2015-104. Passed 12-15-15.)
1501.19 AUTHORITY OF TAX ADMINISTRATOR; VERIFICATION OF INFORMATION.
Authority.
(A) Nothing in this Chapter shall limit the authority of the Tax Administrator to perform
any of the following duties or functions, unless the performance of such duties or functions
is expressly limited by a provision of the ORC:
(1) (a) Exercise all powers whatsoever of an query nature as provided by law,
including, the right to inspect books, accounts, records, memorandums, and federal and
state income tax returns, to examine persons under oath, to issue orders or subpoenas for
the production of books, accounts, papers, records, documents, and testimony, to take
depositions, to apply to a court for attachment proceedings as for contempt, to approve
vouchers for the fees of officers and witnesses, and to administer oaths.
(b) The powers referred to in this division of this section shall be exercised by the
Tax Administrator only in connection with the performance of the duties respectively
assigned to the Tax Administrator under the City's income tax ordinance;
(2) Appoint agents and prescribe their powers and duties;
(3) Confer and meet with officers of other municipal corporations and states and
officers of the United States on any matters pertaining to their respective official duties as
provided by law;
(4) Exercise the authority provided by law, including orders from bankruptcy courts,
relative to remitting or refunding taxes, including penalties and interest thereon, for any
reason overpaid. In addition, the Tax Administrator may investigate any claim of
overpayment and, if the Tax Administrator finds that there has been an overpayment, make
a written statement of the Tax Administrator's findings, and approve and issue a refund
payable to the taxpayer, the taxpayer's assigns, or legal representative as provided in this
chapter/ordinance;
(5) Exercise the authority provided by law relative to consenting to the compromise
and settlement of tax claims;
(6) Exercise the authority provided by law relative to the use of alternative
apportionment methods by taxpayers in accordance with Section 1501.03 ;
(7) (a) Make all tax findings, determinations, computations, and orders the Tax
Administrator is by law authorized and required to make and, pursuant to time limitations
provided by law, on the Tax Administrator's own motion, review, re-determine, or correct
any tax findings, determinations, computations, or orders the Tax Administrator has made.
(b) If an appeal has been filed with the Board of Tax Review or other appropriate
tribunal, the Tax Administrator shall not review, re-determine, or correct any tax finding,
determination, computation, or order which the Tax Administrator has made, unless such
appeal or application is withdrawn by the appellant or applicant, is dismissed, or is
otherwise final;
(8) Destroy any or all returns or other tax documents in the manner authorized by
law;
(9) Enter into an agreement with a taxpayer to simplify the withholding obligations
described in Section 1501.04 .
Verification of accuracy of returns and determination of liability.
(B) (1) A Tax Administrator, or any authorized agent or employee thereof may examine
the books, papers, records, and federal and state income tax returns of any employer,
taxpayer, or other person that is subject to, or that the Tax Administrator believes is
subject to, the provisions of this Chapter for the purpose of verifying the accuracy of any
return made or, if no return was filed, to ascertain the tax due under this
chapter/ordinance. Upon written request by the Tax Administrator or a duly authorized
agent or employee thereof, every employer, taxpayer, or other person subject to this
section is required to furnish the opportunity for the Tax Administrator, authorized agent,
or employee to investigate and examine such books, papers, records, and federal and state
income tax returns at a reasonable time and place designated in the request.
(2) The records and other documents of any taxpayer, employer, or other person that
is subject to, or that a Tax Administrator believes is subject to, the provisions of this
Chapter shall be open to the Tax Administrator's inspection during business hours and
shall be preserved for a period of six years following the end of the taxable year to which
the records or documents relate, unless the Tax Administrator, in writing, consents to their
destruction within that period, or by order requires that they be kept longer. The Tax
Administrator may require any person, by notice served on that person, to keep such
records as the Tax Administrator determines necessary to show whether or not that
person is liable, and the extent of such liability, for the income tax levied by the City or for
the withholding of such tax.
(3) The Tax Administrator may examine under oath any person that the Tax
Administrator reasonably believes has knowledge concerning any income that was or
would have been returned for taxation or any transaction tending to affect such income.
The Tax Administrator may, for this purpose, compel any such person to attend a hearing
or examination and to produce any books, papers, records, and federal and state income
tax returns in such person's possession or control. The person may be assisted or
represented by an attorney, accountant, bookkeeper, or other tax practitioner at any such
hearing or examination. This division does not authorize the practice of law by a person
who is not an attorney.
(4) No person issued written notice by the Tax Administrator compelling attendance
at a hearing or examination or the production of books, papers, records, or federal or state
income tax returns under this section shall fail to comply.
Identification information.
(C) (1) Nothing in this Chapter prohibits the Tax Administrator from requiring any
person filing a tax document with the Tax Administrator to provide identifying information,
which may include the person's social security number, federal employer identification
number, or other identification number requested by the Tax Administrator. A person
required by the Tax Administrator to provide identifying information that has experienced
any change with respect to that information shall notify the Tax Administrator of the
change before, or upon, filing the next tax document requiring the identifying information.
(2) (a) If the Tax Administrator makes a request for identifying information and the
Tax Administrator does not receive valid identifying information within 30 days of making
the request, nothing in this Chapter prohibits the Tax Administrator from imposing a
penalty upon the person to whom the request was directed pursuant to Section 1501.18 ,
in addition to any applicable penalty described in Section 1501.99 .
(b) If a person required by the Tax Administrator to provide identifying information
does not notify the Tax Administrator of a change with respect to that information as
required under division (C) of Section 1501.19 within 30 days after filing the next tax
document requiring such identifying information, nothing in this Chapter prohibits the Tax
Administrator from imposing a penalty pursuant to Section 1501.18 .
(c) The penalties provided for under divisions (C)(2)(a) and (b) of this section may
be billed and imposed in the same manner as the tax or fee with respect to which the
identifying information is sought and are in addition to any applicable criminal penalties
described in Section 1501.99 for a violation of Section 1501.17 and any other penalties
that may be imposed by the Tax Administrator by law.
(Ord. 2015-104. Passed 12-15-15.)
1501.20 REQUEST FOR OPINION OF THE TAX ADMINISTRATOR.
(A) An "opinion of the Tax Administrator" means an opinion issued under this section
with respect to prospective municipal income tax liability. It does not include ordinary
correspondence of the Tax Administrator.
(B) A taxpayer may submit a written request for an opinion of the Tax Administrator in
accordance with the Rules and Regulations.
(C) A taxpayer is not relieved of tax liability for any activity or transaction related to a
request for an opinion that contained any misrepresentation or omission of one or more
material facts.
(D) A Tax Administrator may refuse to offer an opinion on any request received under
this section. Such refusal is not subject to appeal.
(E) An opinion of the Tax Administrator binds the Tax Administrator only with respect
to the taxpayer for whom the opinion was prepared and does not bind the Tax
Administrator of any other municipal corporation.
(F) An opinion of the Tax Administrator issued under this section is not subject to
appeal.
(Ord. 2015-104. Passed 12-15-15.)
1501.21 BOARD OF TAX REVIEW.
(A) (1) The Board of Tax Review shall consist of three members. Two members shall be
appointed by the legislative authority of the City, but such appointees may not be
employees, elected officials, or contractors with the City at any time during their term or in
the five years immediately preceding the date of appointment. One member shall be
appointed by the Mayor of the City. This member may be an employee of the City, but may
not be the director of finance or equivalent officer, or the Tax Administrator or other
similar official or an employee directly involved in municipal tax matters, or any direct
subordinate thereof.
(2) The term for members of the Board of Tax Review shall be two years. There is no
limit on the number of terms that a member may serve if the member is reappointed by the
legislative authority. The board member appointed by the Mayor of the City shall serve at
the discretion of the administrative official.
(3) Members of the Board of Tax Review appointed by the legislative authority may be
removed by the legislative authority by majority vote for malfeasance, misfeasance, or
nonfeasance in office. To remove such a member, the legislative authority must give the
member a copy of the charges against the member and afford the member an opportunity
to be publicly heard in person or by counsel in the member's own defense upon not less
than ten days' notice. The decision by the legislative authority on the charges is final and
not appealable.
(4) A member of the Board of Tax Review who, for any reason, ceases to meet the
qualifications for the position prescribed by this section shall resign immediately by
operation of law.
(5) A vacancy in an unexpired term shall be filled in the same manner as the original
appointment within 60 days of when the vacancy was created. Any member appointed to
fill a vacancy occurring prior to the expiration of the term for which the member's
predecessor was appointed shall hold office for the remainder of such term. No vacancy on
the Board of Tax Review shall impair the power and authority of the remaining members to
exercise all the powers of the Board of Tax Review.
(6) If a member is temporarily unable to serve on the Board of Tax Review due to a
conflict of interest, illness, absence, or similar reason, the legislative authority or top
administrative official that appointed the member shall appoint another individual to
temporarily serve on the Board of Tax Review in the member's place. The appointment of
such an individual shall be subject to the same requirements and limitations as are
applicable to the appointment of the member temporarily unable to serve.
(B) Whenever a Tax Administrator issues an assessment, the Tax Administrator shall
notify the taxpayer in writing at the same time of the taxpayer's right to appeal the
assessment, the manner in which the taxpayer may appeal the assessment, and the address
to which the appeal should be directed.
(C) Any person who has been issued an assessment may appeal the assessment to the
Board of Tax Review by filing a request with the Board of Tax Review. The request shall be
in writing, shall specify the reason or reasons why the assessment should be deemed
incorrect or unlawful, and shall be filed within 60 days after the taxpayer receives the
assessment.
(D) The Board of Tax Review shall schedule a hearing to be held within 60 days after
receiving an appeal of an assessment under division (C) of this section, unless the taxpayer
requests additional time to prepare or waives a hearing. If the taxpayer does not waive the
hearing, the taxpayer may appear before the Board of Tax Review and may be represented
by an attorney at law, certified public accountant, or other representative. The Board of Tax
Review may allow a hearing to be continued as jointly agreed to by the parties. In such a
case, the hearing must be completed within 120 days after the first day of the hearing
unless the parties agree otherwise.
(E) The Board of Tax Review may affirm, reverse, or modify the Tax Administrator's
assessment or any part of that assessment. The Board of Tax Review shall issue a final
determination on the appeal within 90 days after the Board of Tax Review's final hearing
on the appeal, and send a copy of its final determination by ordinary mail to all of the
parties to the appeal within 15 days after issuing the final determination. The taxpayer or
the Tax Administrator may appeal the Board of Tax Review's final determination as
provided in Section 5717.011 of the ORC.
(F) The Board of Tax Review created pursuant to this section shall adopt rules
governing its procedures and shall keep a record of its transactions. Such records are not
public records available for inspection under Section 149.43 of the ORC. Hearings
requested by a taxpayer before a Board of Tax Review created pursuant to this section are
not meetings of a public body subject to Section 121.22 of the ORC.
(Ord. 2015-104. Passed 12-15-15.)
1501.22 AUTHORITY TO CREATE RULES AND REGULATIONS.
(A) Nothing in this Chapter prohibits the legislative authority of the City, or a Tax
Administrator pursuant to authority granted to the administrator by resolution or
ordinance, to adopt rules to administer an income tax imposed by City in accordance with
this chapter. Such rules shall not conflict with or be inconsistent with any provision of this
chapter/ordinance. Taxpayers are hereby required to comply not only with the
requirements of this chapter, but also to comply with the Rules and Regulations.
(B) All rules adopted under this section shall be published and posted on the internet.
(Ord. 2015-104. Passed 12-15-15.)
1501.23 RENTAL AND LEASED PROPERTY.
(A) All property owners of real property located in the City, who rent or otherwise lease
the same, or any part thereof, to any person for residential dwelling purposes, including
apartments, rooms and other rental accommodations, during any calendar year, or part
thereof, commencing with the effective date of this section, shall file with the Tax
Administrator on or before the January 31 first following such calendar year a written
report disclosing the name, address and also telephone number, if available, of each tenant
known to have occupied on December 31 during such calendar year such apartment, room
or other residential dwelling rental property.
(B) The Tax Administrator may order the appearance before him, or his duly authorized
agent, of any person whom he believes to have any knowledge of the name, address and
telephone number of any tenant of residential rental real property in the City. The Tax
Administrator, or his duly authorized agent, is authorized to examine any person, under
oath, concerning the name, address and telephone number of any tenant of residential real
property located in the City. The Tax Administrator, or his duly authorized agent, may
compel the production of papers and records and the attendance of all personal before him,
whether as parties or witnesses, whenever he believes such person has knowledge of the
name, address and telephone number of any tenant of residential real property in the City.
(C) Any property owner or person that violates one or more of the following shall be
subject to Section 1501.99 of this chapter/ordinance:
(1) Fails, refuses or neglects to timely file a written report required by subsection (a)
hereof; or
(2) Makes an incomplete or intentionally false written report required by subsection
(a) hereof; or
(3) Fails to appear before the Tax Administrator or any duly authorized agent and to
produce and disclose any tenant information pursuant to any order or subpoena of the Tax
Administrator as authorized in this section; or
(4) Fails to comply with the provisions of this section or any order or subpoena of the
Tax Administrator.
(Ord. 2015-104. Passed 12-15-15.)
1501.24 SAVINGS CLAUSE.
This Chapter shall not apply to any person, firm or corporation, or to any property as to
whom or which it is beyond the power of Council to impose the tax herein provided for.
Any sentence, clause, section or part of this Chapter or any tax against or exception granted
any individual or any of the several groups of persons, or forms of income specified herein
if found to be unconstitutional, illegal or invalid, such unconstitutionality, illegality or
invalidity shall affect only such clause, sentence, section or part of this Chapter and shall
not affect or impair any of the remaining provisions, sentences, clauses, sections or other
parts of this chapter/ordinance. It is hereby declared to be the intention of Council that this
Chapter would have been adopted had such unconstitutional, illegal or invalid sentence or
part hereof, not been included therein.
(Ord. 2015-104. Passed 12-15-15.)
1501.25 COLLECTION OF TAX AFTER TERMINATION OF ORDINANCE.
(A) This chapter shall continue effective insofar as the levy of taxes is concerned until
repealed, and insofar as the collection of taxes levied hereunder and actions or proceedings
for collecting any tax so levied or enforcing any provisions of this chapter are concerned, it
shall continue effective until all of said taxes levied hereunder in the aforesaid periods are
fully paid and any and all suits and prosecutions for the collection of said taxes or for the
punishment of violations of this chapter shall have been fully terminated, subject to the
limitations contained in Section 1501.12 and Section 1501.99 hereof.
(B) Annual returns due for all or any part of the last effective year of this ordinance shall
be due on the date provided in Sections 1501.05 and Section 1501.04 of this ordinance as
though the same were continuing.
(Ord. 2015-104. Passed 12-15-15.)
1501.26 ADOPTION OF RITA RULES AND REGULATIONS.
The City hereby adopts the Regional Income Tax Agency (RITA) Rules & Regulations,
including amendments that may be made from time to time, for use as the City's Income
Tax Rules and Regulations. In the event of a conflict with any provision(s) of the City
Income Tax Ordinance and the RITA Rules & Regulations, the Ordinance will supersede.
Until and if the contractual relationship between the City and RITA ceases, Section 1501.26
will supersede all other provisions within Ordinance 2015-104 regarding promulgation of
rules and regulations by the Tax Administrator.
(Ord. 2015-104. Passed 12-15-15.)
1501.99 VIOLATIONS; PENALTIES.
(A) Whoever violates Section 1501.17 , division (A) of Section 1501.16 , or Section
1501.04 by failing to remit City income taxes deducted and withheld from an employee,
shall be guilty of a misdemeanor of the first degree and shall be subject to a fine of not
more than $1,000 or imprisonment for a term of up to six months, or both. If the individual
that commits the violation is an employee or official of the City, the individual is subject to
discharge from employment or dismissal from office.
(B) Any person who discloses information received from the Internal Revenue Service
in violation of division (A) of Section 1501.16 shall be guilty of a felony of the fifth degree
and shall be subject to a fine of not more than $5,000 plus the costs of prosecution, or
imprisonment for a term not exceeding five years, or both. If the individual that commits
the violation is an employee or official of the City, the individual is subject to discharge
from employment or dismissal from office.
(C) Each instance of access or disclosure in violation of division (A) of Section 1501.16
constitutes a separate offense.
(D) If not otherwise specified herein, no person shall:
(1) Fail, neglect or refuse to make any return or declaration required by this ordinance;
(2) File any incomplete or false return;
(3) Fail, neglect or refuse to pay the tax, penalties or interest imposed by this
chapter/ordinance;
(4) Refuse to permit the Tax Administrator or any duly authorized agent or employee
to examine his books, records, papers and federal and state income tax returns relating to
the income or net profits of a taxpayer;
(5) Fail to appear before the Tax Administrator and to produce his books, records,
papers or federal and state income tax returns relating to the income or net profits of a
taxpayer upon order or subpoena of the Tax Administrator;
(6) Refuse to disclose to the Tax Administrator any information with respect to the
income or net profits of a taxpayer;
(7) Fail to comply with the provisions of this ordinance or any order or subpoena of the
Tax Administrator authorized hereby;
(8) Give to an employer false information as to his true name, correct social security
number, and residence address, or fail to promptly notify an employer of any change in
residence address and date thereof;
(9) Attempt to do anything whatsoever to avoid the payment of the whole or any part
of the tax, penalties or interest imposed by this chapter/ordinance.
(E) Any person who violates any of the provisions in Section 1501.99 (D) shall be
subject to the penalties provided for in Section 1501.99 (A) of this chapter/ordinance.
(Ord. 2015-104. Passed 12-15-15.)
---
[2023-143 Code 1501 Amend Exhibit B.pdf]
1
CHAPTER 1501
Municipal Income Tax
1501.01 Authority to levy tax; purpose of tax.
1501.02 Definitions.
1501.03 Imposition of income tax.
1501.04 Collection at source.
1501.05 Annual return; filing.
1501.06 Credit for tax paid to other municipalities.
1501.07 Estimated taxes.
1501.08 Rounding of amounts.
1501.09 Requests for refunds.
1501.10 Second municipality imposing tax after time period allowed for refund.
1501.11 Amended returns.
1501.12 Limitations.
1501.13 Audits.
1501.14 Service of assessment.
1501.15 Administration of claims.
1501.16 Tax information confidential.
1501.17 Fraud.
1501.18 Interest and penalties.
1501.19 Authority of Tax Administrator; verification of information.
1501.20 Request for opinion of the Tax Administrator.
1501.21 Board of Tax Review.
1501.22 Authority to create rules and regulations.
1501.23 Rental and leased property.
1501.24 Savings clause.
1501.25 Collection of tax after termination of ordinance.
1501.26 Adoption of RITA Rules and Regulations.
1501.27 Election to be subject to R.C. 718.80 to 718.95
1501.99 Violations; penalties.
1501.01 AUTHORITY TO LEVY TAX; PURPOSE OF TAX.
(A) To provide funds for the purposes of general municipal operations, maintenance, new equipment,
extension and enlargement of municipal services and facilities and capital improvements, the City of North
Olmsted (the City) hereby levies an annual municipal income tax on income, qualifying wages,
EXHIBIT B
2
commissions and other compensation, and on net profits as hereinafter provided. This Ordinance is to have
prospective application only. Salaries, wages, commissions and other compensation, together with net
profits, or any other income subject to the North Olmsted municipal income tax and earned in and prior to
the year 2015 shall be governed by Chapter 15, Title One of the Codified Ordinances, titled "Taxation
Code; Municipal Income Tax" as it existed immediately prior to the effective date of this Chapter."
There shall be and is hereby levied a tax on salaries, wages, commissions and other compensation, and on
net profits as hereinafter provided, to provide funds for the City of North Olmsted to be allocated for use
as follows:
(a) Fifteen percent (15%) to pay costs of services and facilities for solid waste management, recycling
and disposal;
(b) Fifteen percent (15%) to pay costs of any permanent improvements for the City including
permanent improvements to the City's street and storm water drainage systems, the payment of debt charges
on bonds and notes issued after 1990 for those purposes, and costs of maintaining the City's street and storm
water drainage systems and related equipment; and
(c) The balance to pay costs of general municipal functions of the City.
(B) (1) The annual tax is levied at a rate of 2% (two percent). The tax is levied at a uniform rate on all
persons residing in or earning or receiving income in North Olmsted. The tax is levied on income, qualifying
wages, commissions and other compensation, and on net profits as hereinafter provided in Section 1501.03
of Chapter 1501 and other sections as they may apply.
(2) Intentionally left blank.
(C) The tax on income and the withholding tax established by this Ordinance 2023-143 are authorized by
Article XVIII, Section 3 of the Ohio Constitution. The tax is levied in accordance with, and is intended to
be consistent with, the provisions and limitations of Ohio Revised Code 718.
1501.02 DEFINITIONS.
(A) Any term used in this Chapter that is not otherwise defined in this Chapter has the same meaning as
when used in a comparable context in laws of the United States relating to federal income taxation or in
Title LVII of the ORC, unless a different meaning is clearly required. If a term used in this Chapter that is
not otherwise defined in this Chapter is used in a comparable context in both the laws of the United States
relating to federal income tax and in Title LVII of the ORC and the use is not consistent, then the use of the
term in the laws of the United States relating to federal income tax shall control over the use of the term in
Title LVII of the ORC.
(B) The singular shall include the plural, and the masculine shall include the feminine and the gender-
neutral.
(C) As used in this Chapter:
(1) "Adjusted federal taxable income" for a person required to file as a C corporation, or for a person
that has elected to be taxed as a C corporation under (C)(24)(e) of this division, means a C corporation's
federal taxable income before net operating losses and special deductions as determined under the Internal
Revenue Code, adjusted as follows:
3
(a) Deduct intangible income to the extent included in federal taxable income. The deduction shall be
allowed regardless of whether the intangible income relates to assets used in a trade or business or assets
held for the production of income.
(b) Add an amount equal to five percent (5%) of intangible income deducted under division (C)(1)(a)
of this section, but excluding that portion of intangible income directly related to the sale, exchange, or
other disposition of property described in Section 1221 of the Internal Revenue Code;
(c) Add any losses allowed as a deduction in the computation of federal taxable income if the losses
directly relate to the sale, exchange, or other disposition of an asset described in Section 1221 or 1231 of
the Internal Revenue Code;
(d)(i) Except as provided in (C)(1)(d)(ii) of this section, deduct income and gain included in federal
taxable income to the extent the income and gain directly relate to the sale, exchange, or other disposition
of an asset described in Section 1221 or 1231 of the Internal Revenue Code;
(ii) Division (C)(1)(d)(i) of this section does not apply to the extent the income or gain is income
or gain described in Section 1245 or 1250 of the Internal Revenue Code.
(e) Add taxes on or measured by net income allowed as a deduction in the computation of federal
taxable income;
(f) In the case of a real estate investment trust or regulated investment company, add all amounts with
respect to dividends to, distributions to, or amounts set aside for or credited to the benefit of investors and
allowed as a deduction in the computation of federal taxable income;
(g) Deduct, to the extent not otherwise deducted or excluded in computing federal taxable income,
any income derived from a transfer agreement or from the enterprise transferred under that agreement under
Section 4313.02 of the ORC;
(h) Deduct exempt income to the extent not otherwise deducted or excluded in computing adjusted
federal taxable income.
(i) Deduct any net profit of a pass-through entity owned directly or indirectly by the taxpayer and
included in the taxpayer's federal taxable income unless an affiliated group of corporations includes that
net profit in the group's federal taxable income in accordance with division (V)(3)(b) of Section 1501.05.
(j) Add any loss incurred by a pass-through entity owned directly or indirectly by the taxpayer and
included in the taxpayer's federal taxable income unless an affiliated group of corporations includes that
loss in the group's federal taxable income in accordance with division (V)(3)(b) of Section 1501.05.
If the taxpayer is not a C corporation, is not a disregarded entity that has made an election described in
division (C)(48)(b) of this section, is not a publicly traded partnership that has made the election described
in division (C)(24)(e) of this section, and is not an individual, the taxpayer shall compute adjusted federal
taxable income under this section as if the taxpayer were a C corporation, except guaranteed payments and
other similar amounts paid or accrued to a partner, former partner, shareholder, former shareholder,
member, or former member shall not be allowed as a deductible expense unless such payments are in
consideration for the use of capital and treated as payment of interest under Section 469 of the Internal
Revenue Code or United States treasury regulations. Amounts paid or accrued to a qualified self-employed
retirement plan with respect to a partner, former partner, shareholder, former shareholder, member, or
4
former member of the taxpayer, amounts paid or accrued to or for health insurance for a partner, former
partner, shareholder, former shareholder, member, or former member, and amounts paid or accrued to or
for life insurance for a partner, former partner, shareholder, former shareholder, member, or former member
shall not be allowed as a deduction.
Nothing in division (C)(1) of this section shall be construed as allowing the taxpayer to add or deduct any
amount more than once or shall be construed as allowing any taxpayer to deduct any amount paid to or
accrued for purposes of federal self-employment tax.
(2)(a) "Assessment" means a written finding by the Tax Administrator that a person has underpaid
municipal income tax, or owes penalty and interest, or any combination of tax, penalty, or interest, to the
municipal corporation that commences the person's time limitation for making an appeal to the Board of
Tax Review pursuant to Section 1501.21, and has "ASSESSMENT" written in all capital letters at the top
of such finding.
(b) "Assessment" does not include a notice denying a request for refund issued under division (C)(3)
of Section 1501.09, a billing statement notifying a taxpayer of current or past-due balances owed to the
municipal corporation, a Tax Administrator's request for additional information, a notification to the
taxpayer of mathematical errors, or a Tax Administrator's other written correspondence to a person or
taxpayer that does not meet the criteria prescribed by division (C)(2)(a) of this section.
(3) "Audit" means the examination of a person or the inspection of the books, records, memoranda, or
accounts of a person, ordered to appear before the Tax Administrator, for the purpose of determining
liability for a municipal income tax.
(4) "Board of Tax Review" or “Board of Review” or “Board of Tax Appeals”, or other named local
board constituted to hear appeals of municipal income tax matters, means the entity created under Section
1501.21.
(5) "Calendar quarter" means the three-month period ending on the last day of March, June,
September, or December.
(6) "Casino operator" and "casino facility" have the same meanings as in Section 3772.01 of the
ORC.
(7) "Certified mail," "express mail," "United States mail," "postal service," and similar terms
include any delivery service authorized pursuant to Section 5703.056 of the ORC.
(8) "Disregarded entity" means a single member limited liability company, a qualifying subchapter S
subsidiary, or another entity if the company, subsidiary, or entity is a disregarded entity for federal income
tax purposes.
(9) “Domicile” means the true, fixed, and permanent home of a taxpayer and to which, whenever absent,
the taxpayer intends to return. A taxpayer may have more than one residence but not more than one
domicile.
(10) "Employee" means an individual who is an employee for federal income tax purposes.
(11) "Employer" means a person that is an employer for federal income tax purposes.
5
(12) "Exempt income" means all of the following:
(a) The military pay or allowances of members of the armed forces of the United States or members
of their reserve components, including the national guard of any state.
(b) Intangible income. However, a municipal corporation that taxed any type of intangible income
on March 29, 1988, pursuant to Section 3 of S.B. 238 of the 116th general assembly, may continue to tax
that type of income if a majority of the electors of the municipal corporation voting on the question of
whether to permit the taxation of that type of intangible income after 1988 voted in favor thereof at an
election held on November 8, 1988.
(c) Social security benefits, railroad retirement benefits, unemployment compensation, pensions,
retirement benefit payments, payments from annuities, and similar payments made to an employee or to the
beneficiary of an employee under a retirement program or plan, disability payments received from private
industry or local, state, or federal governments or from charitable, religious or educational organizations,
and the proceeds of sickness, accident, or liability insurance policies. As used in division (C)(12)(c) of this
section, "unemployment compensation" does not include supplemental unemployment compensation
described in Section 3402(o)(2) of the Internal Revenue Code.
(d) The income of religious, fraternal, charitable, scientific, literary, or educational institutions to the
extent such income is derived from tax-exempt real estate, tax-exempt tangible or intangible property, or
tax-exempt activities.
(e) Compensation paid under Section 3501.28 or 3501.36 of the ORC to a person serving as a precinct
election official to the extent that such compensation does not exceed $1,000 for the taxable year. Such
compensation in excess of $1,000 for the taxable year may be subject to taxation by a municipal corporation.
A municipal corporation shall not require the payer of such compensation to withhold any tax from that
compensation.
(f) Dues, contributions, and similar payments received by charitable, religious, educational, or literary
organizations or labor unions, lodges, and similar organizations;
(g) Alimony and child support received.
(h) Compensation for personal injuries or for damages to property from insurance proceeds or
otherwise, excluding compensation paid for lost salaries or wages or compensation from punitive damages.
(i) Income of a public utility when that public utility is subject to the tax levied under Section 5727.24
or 5727.30 of the ORC. Division (C)(12)(i) of this section does not apply for purposes of Chapter 5745. of
the ORC.
(j) Gains from involuntary conversions, interest on federal obligations, items of income subject to a
tax levied by the state and that a municipal corporation is specifically prohibited by law from taxing, and
income of a decedent's estate during the period of administration except such income from the operation of
a trade or business.
(k) Compensation or allowances excluded from federal gross income under Section 107 of the
Internal Revenue Code.
6
(l) Employee compensation that is not qualifying wages as defined in division (C)(35) of this section.
(m) Compensation paid to a person employed within the boundaries of a United States air force base
under the jurisdiction of the United States air force that is used for the housing of members of the United
States air force and is a center for air force operations, unless the person is subject to taxation because of
residence or domicile. If the compensation is subject to taxation because of residence or domicile, tax on
such income shall be payable only to the municipal corporation of residence or domicile.
(n) An S corporation shareholder's share of net profits of the S corporation, other than any part of
the share of net profits that represents wages as defined in Section 3121(a) of the Internal Revenue Code or
net earnings from self-employment as defined in Section 1402(a) of the Internal Revenue Code.
(o) To the extent authorized under a resolution or ordinance adopted by the City before January 1,
2016, all or a portion of the income of individuals or a class of individuals under 18 years of age.
(p)(i) Except as provided in divisions (C)(12)(p)(ii), (iii), and (iv) of this section, qualifying wages
described in division (C)(2) or (5) of Section 1501.04 to the extent the qualifying wages are not subject to
withholding for the City under either of those divisions.
(ii) The exemption provided in division (C)(12)(p)(i) of this section does not apply with respect to
the municipal corporation in which the employee resided at the time the employee earned the qualifying
wages.
(iii) The exemption provided in division (C)(12)(p)(i) of this section does not apply to qualifying
wages that an employer elects to withhold under division (C)(4)(b) of Section 1501.04.
(iv) The exemption provided in division (C)(12)(p)(i) of this section does not apply to qualifying
wages if both of the following conditions apply:
(a) For qualifying wages described in division (C)(2) of Section 1501.04, the employee's
employer withholds and remits tax on the qualifying wages to the municipal corporation in which the
employee's principal place of work is situated, or, for qualifying wages described in division (C)(5) of
Section 1501.04, the employee's employer withholds and remits tax on the qualifying wages to the
municipal corporation in which the employer's fixed location is located;
(b) The employee receives a refund of the tax described in division (C)(12)(p)(iv)(a) of this
section on the basis of the employee not performing services in that municipal corporation.
(q)(i) Except as provided in division (C)(12)(q)(ii) or (iii) of this section, compensation that is not
qualifying wages paid to a nonresident individual for personal services performed in the City on not more
than 20 days in a taxable year.
(ii) The exemption provided in division (C)(12)(q)(ii) of this section does not apply under either
of the following circumstances:
(a) The individual's base of operation is located in the municipal corporation.
(b) The individual is a professional athlete, professional entertainer, or public figure, and the
compensation is paid for the performance of services in the individual's capacity as a professional athlete,
7
professional entertainer, or public figure. For purposes of division (C)(12)(q)(ii)(b) of this section,
"professional athlete," "professional entertainer," and "public figure" have the same meanings as in Section
1501.04 (C).
(iii) Compensation to which division (C)(12)(q) of this section applies shall be treated as earned or
received at the individual's base of operation. If the individual does not have a base of operation, the
compensation shall be treated as earned or received where the individual is domiciled.
(iv) For purposes of division (C)(12)(q) of this section, "base of operation" means the location
where an individual owns or rents an office, storefront, or similar facility to which the individual regularly
reports and at which the individual regularly performs personal services for compensation.
(r) Compensation paid to a person for personal services performed for a political subdivision on
property owned by the political subdivision, regardless of whether the compensation is received by an
employee of the subdivision or another person performing services for the subdivision under a contract with
the subdivision, if the property on which services are performed is annexed to a municipal corporation
pursuant to Section 709.023 of the ORC on or after March 27, 2013, unless the person is subject to such
taxation because of residence. If the compensation is subject to taxation because of residence, municipal
income tax shall be payable only to the municipal corporation of residence.
(s) Income the taxation of which is prohibited by the constitution or laws of the United States.
Any item of income that is exempt income of a pass-through entity under division (C) of this section is
exempt income of each owner of the pass-through entity to the extent of that owner's distributive or
proportionate share of that item of the entity's income.
(13) "Form 2106" means internal revenue service form 2106 filed by a taxpayer pursuant to the Internal
Revenue Code.
(14) "Generic form" means an electronic or paper form that is not prescribed by a particular municipal
corporation and that is designed for reporting taxes withheld by an employer, agent of an employer, or other
payer, estimated municipal income taxes, or annual municipal income tax liability or for filing a refund
claim.
(15) “Gross receipts” means the total revenue derived from sales, work done, or service rendered.
(16) "Income" means the following:
(a)(i) For residents, all income, salaries, qualifying wages, commissions, and other compensation from
whatever source earned or received by the resident, including the resident's distributive share of the net
profit of pass-through entities owned directly or indirectly by the resident and any net profit of the resident,
except as provided in (C)(24)(e) of this division.
(ii) For the purposes of division (C)(16)(a)(i) of this section:
(a) Any net operating loss of the resident incurred in the taxable year and the resident's
distributive share of any net operating loss generated in the same taxable year and attributable to the
resident's ownership interest in a pass-through entity shall be allowed as a deduction, for that taxable year
and the following five taxable years, against any other net profit of the resident or the resident's distributive
8
share of any net profit attributable to the resident's ownership interest in a pass-through entity until fully
utilized, subject to division (C)(16)(a)(iv) of this section;
(b) The resident's distributive share of the net profit of each pass-through entity owned directly
or indirectly by the resident shall be calculated without regard to any net operating loss that is carried
forward by that entity from a prior taxable year and applied to reduce the entity's net profit for the current
taxable year.
(iii) Division (C)(16)(a)(ii) of this section does not apply with respect to any net profit or net
operating loss attributable to an ownership interest in an S corporation unless shareholders' shares of net
profits from S corporations are subject to tax in the municipal corporation as provided in division(C)(12)(n)
or (C)(16)(e) of this section.
(iv) Any amount of a net operating loss used to reduce a taxpayer's net profit for a taxable year
shall reduce the amount of net operating loss that may be carried forward to any subsequent year for use by
that taxpayer. In no event shall the cumulative deductions for all taxable years with respect to a taxpayer's
net operating loss exceed the original amount of that net operating loss available to that taxpayer.
(b) In the case of nonresidents, all income, salaries, qualifying wages, commissions, and other
compensation from whatever source earned or received by the nonresident for work done, services
performed or rendered, or activities conducted in the municipal corporation, including any net profit of the
nonresident, but excluding the nonresident's distributive share of the net profit or loss of only pass-through
entities owned directly or indirectly by the nonresident.
(c) For taxpayers that are not individuals, net profit of the taxpayer;
(d) Lottery, sweepstakes, gambling and sports winnings, winnings from games of chance, and prizes
and awards. If the taxpayer is a professional gambler for federal income tax purposes, the taxpayer may
deduct related wagering losses and expenses to the extent authorized under the Internal Revenue Code and
claimed against such winnings.
(e) Intentionally left blank.
(17) "Intangible income" means income of any of the following types: income yield, interest, capital
gains, dividends, or other income arising from the ownership, sale, exchange, or other disposition of
intangible property including, but not limited to, investments, deposits, money, or credits as those terms are
defined in Chapter 5701 of the ORC, and patents, copyrights, trademarks, tradenames, investments in real
estate investment trusts, investments in regulated investment companies, and appreciation on deferred
compensation. "Intangible income" does not include prizes, awards, or other income associated with any
lottery winnings, gambling winnings, or other similar games of chance.
(18) "Internal Revenue Code" has the same meaning as in Section 5747.01 of the ORC.
(19) "Limited liability company" means a limited liability company formed under Chapter 1705 of the
ORC or under the laws of another state.
(20) "Municipal corporation" includes a joint economic development district or joint economic
development zone that levies an income tax under Section 715.691, 715.70, 715.71, or 715.74 of the ORC.
9
(21)(a) "Municipal taxable income" means the following:
(i) For a person other than an individual, income apportioned or sitused to the City under Section
1501.03, as applicable, reduced by any pre-2017 net operating loss carryforward available to the person for
the City.
(ii)(a) For an individual who is a resident of the City, income reduced by exempt income to the
extent otherwise included in income, then reduced as provided in division (C)(21)(b) of this section, and
further reduced by any pre-2017 net operating loss carryforward available to the individual for the
municipal corporation.
(b) For an individual who is a nonresident of the City, income reduced by exempt income to the
extent otherwise included in income and then, as applicable, apportioned or sitused to the municipal
corporation under Section 1501.03, then reduced as provided in division (C)(21)(b) of this section, and
further reduced by any pre-2017 net operating loss carryforward available to the individual for the City.
(b) In computing the municipal taxable income of a taxpayer who is an individual, the taxpayer may
subtract, as provided in division (C)(21)(a)(ii)(a) or (C)(21)(b) of this section, the amount of the individual's
employee business expenses reported on the individual's form 2106 that the individual deducted for federal
income tax purposes for the taxable year, subject to the limitation imposed by Section 67 of the Internal
Revenue Code. For the municipal corporation in which the taxpayer is a resident, the taxpayer may deduct
all such expenses allowed for federal income tax purposes, but to the extent the expenses do not relate to
exempt income. For a municipal corporation in which the taxpayer is not a resident, the taxpayer may
deduct such expenses only to the extent the expenses are related to the taxpayer's performance of personal
services in that nonresident municipal corporation and are not related to exempt income.
(22) “Municipality” means the same as the City of North Olmsted. If the terms are capitalized in the
ordinance they are referring to the City of North Olmsted. If not capitalized they refer to a municipal
corporation other than the City of North Olmsted.
(23) "Net operating loss" means a loss incurred by a person in the operation of a trade or business. "Net
operating loss" does not include unutilized losses resulting from basis limitations, at-risk limitations, or
passive activity loss limitations.
(24)
(a) "Net profit" for a person who is an individual means the individual's net profit required to be
reported on schedule C, schedule E, or schedule F reduced by any net operating loss carried forward. For
the purposes of division (C)(24)(a) of this section, the net operating loss carried forward shall be calculated
and deducted in the same manner as provided in division (C)(24)(c) of this section.
(b) “Net profit” for a person other than an individual means adjusted federal taxable income
reduced by any net operating loss incurred by the person in a taxable year beginning on or after
January 1, 2017, subject to the limitations of division (C)(24)(c) of this section.
(c)(i) The amount of such operating loss shall be deducted from net profit to the extent
necessary to reduce municipal taxable income to zero, with any remaining unused portion of the
net operating loss carried forward to not more than five (5) consecutive taxable years following
10
the taxable year in which the loss was incurred, but in no case for more years than necessary for
the deduction to be fully utilized.
(ii) No person shall use the deduction allowed by division (C)(24)(c) of this section to
offset qualifying wages.
(iii)(a) For taxable years beginning in 2018, 2019, 2020, 2021, or 2022, a person may not deduct
more than fifty percent (50%) of the amount of the deduction otherwise allowed by division (C)(24(c) of
this section.
(b) For taxable years beginning in 2023 or thereafter, a person may deduct the full
amount allowed by (C)(24)(c) of this section without regard to the limitation of division
(C)(24)(c)(iii)(a) of this section.
(iv) Any pre-2017 net operating loss carryforward deduction that is available may be utilized
before a taxpayer may deduct any amount pursuant to (C)(24)(c) of this section.
(v) Nothing in division (C)(24)(c)(iii)(a) of this section precludes a person from carrying
forward, for use with respect to any return filed for a taxable year beginning after 2018, any amount of
net operating loss that was not fully utilized by operation of division (C)(24)(c)(iii)(a) of this section. To
the extent that an amount of net operating loss that was not fully utilized in one or more taxable years
by operation of division (C)(1)(h)(iii)(a) of this section is carried forward for use with respect to a return
filed for a taxable year beginning in 2019, 2020, 2021, or 2022, the limitation described in division
(C)(24)(c)(iii)(a) of this section shall apply to the amount carried forward.
(d) For the purposes of this Chapter, and notwithstanding division (C)(24)(a) of this section, net profit
of a disregarded entity shall not be taxable as against that disregarded entity, but shall instead be included
in the net profit of the owner of the disregarded entity.
(e) A publicly traded partnership that is treated as a partnership for federal income tax purposes, and
that is subject to tax on its net profits by the City, may elect to be treated as a C corporation for the City.
The election shall be made on the annual return for the City. The City will treat the publicly traded
partnership as a C corporation if the election is so made.
(25) "Nonresident" means an individual that is not a resident.
(26) "Ohio Business Gateway" means the online computer network system, created under Section
125.30 of the ORC, that allows persons to electronically file business reply forms with state agencies and
includes any successor electronic filing and payment system.
(27) "Other payer" means any person, other than an individual's employer or the employer's agent, that
pays an individual any amount included in the federal gross income of the individual. "Other payer"
includes casino operators and video lottery terminal sales agents.
(28) "Pass-through entity" means a partnership not treated as an association taxable as a C corporation
for federal income tax purposes, a limited liability company not treated as an association taxable as a C
corporation for federal income tax purposes, an S corporation, or any other class of entity from which the
income or profits of the entity are given pass-through treatment for federal income tax purposes. "Pass-
through entity" does not include a trust, estate, grantor of a grantor trust, or disregarded entity.
11
(29)(a) “Pension,” for tax years 2019 and prior, means any amount paid to an employee or former
employee that is reported to the recipient on an IRS form 1099-R, or successor form. Pension does not
include deferred compensation, or amounts attributable to nonqualified deferred compensation plans,
reported as FICA/Medicare wages on an IRS form W-2, Wage and Tax Statement, or successor form.
(b) “Pension” for tax years 2020 and after, means a retirement benefit plan, regardless of whether
the plan satisfies the qualifications described under section 401(a) of the Internal Revenue Code, including
amounts that are taxable under the “Federal Insurance Contributions Act”, Chapter 21 of the Internal
Revenue Code, excluding employee contributions and elective deferrals, and regardless of whether such
amounts are paid in the same taxable year in which the amounts are included in the employee’s wages, as
defined by section 3121(a) of the Internal Revenue Code.
(30) "Person" includes individuals, firms, companies, joint stock companies, business trusts, estates,
trusts, partnerships, limited liability partnerships, limited liability companies, associations, C corporations,
S corporations, governmental entities, and any other entity.
(31) "Postal service" means the United States postal service.
(32) "Postmark date," "date of postmark," and similar terms include the date recorded and marked in
the manner described in division (B)(3) of Section 5703.056 of the ORC.
(33)(a) "Pre-2017 net operating loss carryforward" means any net operating loss incurred in a taxable
year beginning before January 1, 2017, to the extent such loss was permitted, by a resolution or ordinance
of the municipal corporation that was adopted by the municipal corporation before January 1, 2016, to be
carried forward and utilized to offset income or net profit generated in such municipal corporation in future
taxable years.
(b) For the purpose of calculating municipal taxable income, any pre-2017 net operating loss
carryforward may be carried forward to any taxable year, including taxable years beginning in 2017 or
thereafter, for the number of taxable years provided in the resolution or ordinance or until fully utilized,
whichever is earlier.
(34) “Publicly traded partnership” means any partnership, an interest in which is regularly traded on
an established securities market. A “publicly traded partnership” may have any number of partners.
(35) "Qualifying wages" means wages, as defined in Section 3121(a) of the Internal Revenue Code,
without regard to any wage limitations, adjusted as follows:
(a) Deduct the following amounts:
(i) Any amount included in wages if the amount constitutes compensation attributable to a plan or
program described in Section 125 of the Internal Revenue Code.
(ii) Any amount included in wages if the amount constitutes payment on account of a disability
related to sickness or an accident paid by a party unrelated to the employer, agent of an employer, or other
payer.
(iii) Intentionally left blank.
12
(iv) Intentionally left blank.
(v) Any amount included in wages that is exempt income as provided in division (C)(12) of this
section.
(b) Add the following amounts:
(i) Any amount not included in wages solely because the employee was employed by the employer
before April 1, 1986.
(ii) Any amount not included in wages because the amount arises from the sale, exchange, or other
disposition of a stock option, the exercise of a stock option, or the sale, exchange, or other disposition of
stock purchased under a stock option and the municipal corporation has not, by resolution or ordinance,
exempted the amount from withholding and tax adopted before January 1, 2016. Division (C)(35)(b)(ii) of
this section applies only to those amounts constituting ordinary income.
(iii) Any amount not included in wages if the amount is an amount described in section 401(k),
403(b), or 457 of the Internal Revenue Code. Division (C)(35)(b)(ii) of this section applies only to employee
contributions and employee deferrals.
(iv) Any amount that is supplemental unemployment compensation benefits described in Section
3402(o)(2) of the Internal Revenue Code and not included in wages.
(v) Any amount received that is treated as self-employment income for federal tax purposes in
accordance with Section 1402(a)(8) of the Internal Revenue Code.
(vi) Any amount not included in wages if all of the following apply:
(a) For the taxable year the amount is employee compensation that is earned outside the United
States and that either is included in the taxpayer's gross income for federal income tax purposes or would
have been included in the taxpayer’s gross income for such purposes if the taxpayer did not elect to exclude
the income under Section 911 of the Internal Revenue Code;
(b) For no preceding taxable year did the amount constitute wages as defined in Section
3121(a) of the Internal Revenue Code;
(c) For no succeeding taxable year will the amount constitute wages; and
(d) For any taxable year the amount has not otherwise been added to wages pursuant to either
division (C)(35)(b) of this section or Section 1501.04, as that section existed before the effective date of
H.B. 5 of the 130th General Assembly, March 23, 2015.
(36) "Related entity" means any of the following:
(a) An individual stockholder, or a member of the stockholder's family enumerated in Section 318 of
the Internal Revenue Code, if the stockholder and the members of the stockholder's family own directly,
indirectly, beneficially, or constructively, in the aggregate, at least fifty percent (50%) of the value of the
taxpayer's outstanding stock;
13
(b) A stockholder, or a stockholder's partnership, estate, trust, or corporation, if the stockholder and
the stockholder's partnerships, estates, trusts, or corporations own directly, indirectly, beneficially, or
constructively, in the aggregate, at least fifty percent (50%) of the value of the taxpayer's outstanding stock;
(c) A corporation, or a party related to the corporation in a manner that would require an attribution
of stock from the corporation to the party or from the party to the corporation under division (C)(36)(d) of
this section, provided the taxpayer owns directly, indirectly, beneficially, or constructively, at least fifty
percent of the value of the corporation's outstanding stock;
(d) The attribution rules described in Section 318 of the Internal Revenue Code apply for the purpose
of determining whether the ownership requirements in divisions (C)(36)(a) to (c) of this section have been
met.
(37) "Related member" means a person that, with respect to the taxpayer during all or any portion of
the taxable year, is either a related entity, a component member as defined in Section 1563(b) of the Internal
Revenue Code, or a person to or from whom there is attribution of stock ownership in accordance with
Section 1563(e) of the Internal Revenue Code except, for purposes of determining whether a person is a
related member under this division, " twenty percent (20%)" shall be substituted for "five percent (5%)"
wherever "five percent (5%)" appears in Section 1563(e) of the Internal Revenue Code.
(38) "Resident" means an individual who is domiciled in the municipal corporation as determined under
Section 1501.03(E).
(39) "S corporation" means a person that has made an election under subchapter S of Chapter 1 of
Subtitle A of the Internal Revenue Code for its taxable year.
(40) "Schedule C" means internal revenue service schedule C (form 1040) filed by a taxpayer pursuant
to the Internal Revenue Code.
(41) "Schedule E" means internal revenue service schedule E (form 1040) filed by a taxpayer pursuant
to the Internal Revenue Code.
(42) "Schedule F" means internal revenue service schedule F (form 1040) filed by a taxpayer pursuant
to the Internal Revenue Code.
(43) "Single member limited liability company" means a limited liability company that has one direct
member.
(44) "Small employer" means any employer that had total revenue of less than $500,000 during the
preceding taxable year. For purposes of this division, "total revenue" means receipts of any type or kind,
including, but not limited to, sales receipts; payments; rents; profits; gains, dividends, and other investment
income; compensation; commissions; premiums; money; property; grants; contributions; donations; gifts;
program service revenue; patient service revenue; premiums; fees, including premium fees and service fees;
tuition payments; unrelated business revenue; reimbursements; any type of payment from a governmental
unit, including grants and other allocations; and any other similar receipts reported for federal income tax
purposes or under generally accepted accounting principles. "Small employer" does not include the federal
government; any state government, including any state agency or instrumentality; any political subdivision;
or any entity treated as a government for financial accounting and reporting purposes.
14
(45) "Tax Administrator" means the individual charged with direct responsibility for administration of
an income tax levied by the City in accordance with this Chapter. Tax Administrator does not include the
state tax commissioner.
(45)(b) “Tax Commissioner” means the tax commissioner appointed under Section 121.03 of the ORC.
(46) "Tax return preparer" means any individual described in Section 7701(a)(36) of the Internal
Revenue Code and 26 C.F.R. 301.7701-15.
(47) "Taxable year" means the corresponding tax reporting period as prescribed for the taxpayer under
the Internal Revenue Code.
(48)(a) "Taxpayer" means a person subject to a tax levied on income by a municipal corporation in
accordance with this Chapter. "Taxpayer" does not include a grantor trust or, except as provided in division
(C)(48)(b)(i) of this section, a disregarded entity.
(b)(i) A single member limited liability company that is a disregarded entity for federal tax purposes
may be a separate taxpayer from its single member in all Ohio municipal corporations in which it either
filed as a separate taxpayer or did not file for its taxable year ending in 2003, if all of the following
conditions are met:
(a) The limited liability company's single member is also a limited liability company.
(b) The limited liability company and its single member were formed and doing business in one
or more Ohio municipal corporations for at least five years before January 1, 2004.
(c) Not later than December 31, 2004, the limited liability company and its single member each
made an election to be treated as a separate taxpayer under division (L) of ORC 718.01 as that section
existed on December 31, 2004.
(d) The limited liability company was not formed for the purpose of evading or reducing Ohio
municipal corporation income tax liability of the limited liability company or its single member.
(e) The Ohio municipal corporation that was the primary place of business of the sole member
of the limited liability company consented to the election.
(ii) For purposes of division (C)(48)(b)(ii) of this section, a municipal corporation was the primary
place of business of a limited liability company if, for the limited liability company's taxable year ending
in 2003, its income tax liability was greater in that municipal corporation than in any other municipal
corporation in Ohio, and that tax liability to that municipal corporation for its taxable year ending in 2003
was at least $400,000.
(49) "Taxpayers' rights and responsibilities" means the rights provided to taxpayers in Sections 9, 12,
13, 19(B), 20, 21, and Sections 5717.011 and 5717.03 of the ORC, and the responsibilities of taxpayers to
file, report, withhold, remit, and pay municipal income tax and otherwise comply with Chapter 718 of the
ORC and resolutions, ordinances, and rules and regulations adopted by the City for the imposition and
administration of a municipal income tax.
(50) "Video lottery terminal" has the same meaning as in Section 3770.21 of the ORC.
15
(51) "Video lottery terminal sales agent" means a lottery sales agent licensed under Chapter 3770 of
the ORC to conduct video lottery terminals on behalf of the state pursuant to Section 3770.21 of the ORC.
(52) “Retirement benefit plan” means an arrangement whereby an entity provides benefits to individuals
either on or after their termination of service because of retirement or disability. “Retirement benefit plan”
does not include wage continuation payments, severance payments, or payments made for accrued personal
or vacation time.
1501.03 IMPOSITION OF TAX.
The income tax levied by the City at a rate of two percent [2.0%] is levied on the Municipal Taxable Income
of every person residing in and/or earning and/or receiving income in the City,
Individuals.
(A) For residents of the City, the income tax levied herein shall be on all income, salaries, qualifying wages,
commissions, and other compensation from whatever source earned or received by the resident, including
the resident's distributive share of the net profit of pass-through entities owned directly or indirectly by the
resident and any net profit of the resident. This is further detailed in the definition of income (Section
1501.02 (C)(16)).
(B) For nonresidents, all income, salaries, qualifying wages, commissions, and other compensation from
whatever source earned or received by the nonresident for work done, services performed or rendered, or
activities conducted in the municipal corporation, including any net profit of the nonresident, but excluding
the nonresident's distributive share of the net profit or loss of only pass-through entities owned directly or
indirectly by the nonresident.
(C) For residents and nonresidents, income can be reduced to “Municipal Taxable Income” as defined in
Section 1501.02 (C)(21). Exemptions which may apply are specified in Section 1501.02 (C)(12).
Refundable credit for Nonqualified Deferred Compensation Plan.
(D)(1) As used in this division:
(a) "Nonqualified deferred compensation plan" means a compensation plan described in Section
3121(v)(2)(C) of the Internal Revenue Code.
(b) “Qualifying loss” means the amount of compensation attributable to a taxpayer’s nonqualified
deferred compensation plan, less the receipt of money and property attributable to distributions from the
nonqualified deferred compensation plan. Full loss is sustained if no distribution of money and property is
made by the nonqualified deferred compensation plan. The taxpayer sustains a qualifying loss only in the
taxable year in which the taxpayer receives the final distribution of money and property pursuant to that
nonqualified deferred compensation plan.
(c)(i) "Qualifying tax rate" means the applicable tax rate for the taxable year for the which the taxpayer
paid income tax to the City with respect to any portion of the total amount of compensation the payment of
which is deferred pursuant to a nonqualified deferred compensation plan.
16
(ii) If different tax rates applied for different taxable years, then the "qualifying tax rate" is a weighted
average of those different tax rates. The weighted average shall be based upon the tax paid to the City each
year with respect to the nonqualified deferred compensation plan.
(d) “Refundable credit” means the amount of the City income tax that was paid on the non-distributed
portion, if any, of a nonqualified deferred compensation plan.
(2) If, in addition to the City, a taxpayer has paid tax to other municipal corporations with respect to the
nonqualified deferred compensation plan, the amount of the credit that a taxpayer may claim from each
municipal corporation shall be calculated on the basis of each municipal corporation's proportionate share
of the total municipal corporation income tax paid by the taxpayer to all municipal corporations with respect
to the nonqualified deferred compensation plan.
(3) In no case shall the amount of the credit allowed under this section exceed the cumulative income
tax that a taxpayer has paid to the City for all taxable years with respect to the nonqualified deferred
compensation plan.
(4) The credit allowed under this division is allowed only to the extent the taxpayer's qualifying loss is
attributable to:
(a) The insolvency or bankruptcy of the employer who had established the nonqualified deferred
compensation plan; or
(b) The employee's failure or inability to satisfy all of the employer's terms and conditions necessary
to receive the nonqualified deferred compensation.
Domicile.
(E)(1)(a) An individual is presumed to be domiciled in the City for all or part of a taxable year if the
individual was domiciled in the City on the last day of the immediately preceding taxable year or if the Tax
Administrator reasonably concludes that the individual is domiciled in the City for all or part of the taxable
year.
(b) An individual may rebut the presumption of domicile described in division (E)(1)(a) of this
section if the individual establishes by a preponderance of the evidence that the individual was not
domiciled in the City for all or part of the taxable year.
(2) For the purpose of determining whether an individual is domiciled in the City for all or part of a
taxable year, factors that may be considered include, but are not limited to, the following:
(a) The individual's domicile in other taxable years;
(b) The location at which the individual is registered to vote;
(c) The address on the individual's driver's license;
(d) The location of real estate for which the individual claimed a property tax exemption or reduction
allowed on the basis of the individual's residence or domicile;
17
(e) The location and value of abodes owned or leased by the individual;
(f) Declarations, written or oral, made by the individual regarding the individual's residency;
(g) The primary location at which the individual is employed.
(h) The location of educational institutions attended by the individual's dependents as defined in
Section 152 of the Internal Revenue Code, to the extent that tuition paid to such educational institution is
based on the residency of the individual or the individual's spouse in the municipal corporation where the
educational institution is located;
(i) The number of contact periods the individual has with the City. For the purposes of this division,
an individual has one "contact period" with the City if the individual is away overnight from the individual's
abode located outside of the City and while away overnight from that abode spends at least some portion,
however minimal, of each of two consecutive days in the City.
(3) All additional applicable factors are provided in the Rules and Regulations.
Businesses.
(F) This division applies to any taxpayer engaged in a business or profession in the City, unless the taxpayer
is an individual who resides in the City or the taxpayer is an electric company, combined company, or
telephone company that is subject to and required to file reports under Chapter 5745 of the ORC.
(1) Except as otherwise provided in divisions (F)(2) and (G) of this section, net profit from a business
or profession conducted both within and without the boundaries of the City shall be considered as having a
taxable situs in the City for purposes of municipal income taxation in the same proportion as the average
ratio of the following:
(a) The average original cost of the real property and tangible personal property owned or used by the
taxpayer in the business or profession in the City during the taxable period to the average original cost of
all of the real and tangible personal property owned or used by the taxpayer in the business or profession
during the same period, wherever situated.
As used in the preceding paragraph, tangible personal or real property shall include property rented or
leased by the taxpayer and the value of such property shall be determined by multiplying the annual rental
thereon by eight;
(b) Wages, salaries, and other compensation paid during the taxable period to individuals employed
in the business or profession for services performed in the City to wages, salaries, and other compensation
paid during the same period to individuals employed in the business or profession, wherever the individual's
services are performed, excluding compensation from which taxes are not required to be withheld under
Section 1501.04(C);
(c) Total gross receipts of the business or profession from sales and rentals made and services
performed during the taxable period in the City to total gross receipts of the business or profession during
the same period from sales, rentals, and services, wherever made or performed.
18
(2)(a) If the apportionment factors described in division (F)(1) of this section do not fairly represent the
extent of a taxpayer's business activity in the City, the taxpayer may request, or the Tax Administrator of
the City may require, that the taxpayer use, with respect to all or any portion of the income of the taxpayer,
an alternative apportionment method involving one or more of the following:
(i) Separate accounting;
(ii) The exclusion of one or more of the factors;
(iii) The inclusion of one or more additional factors that would provide for a more fair
apportionment of the income of the taxpayer to the municipal corporation;
(iv) A modification of one or more of the factors.
(b) A taxpayer request to use an alternative apportionment method shall be in writing and shall
accompany a tax return, timely filed appeal of an assessment, or timely filed amended tax return. The
taxpayer may use the requested alternative method unless the Tax Administrator denies the request in an
assessment issued within the period prescribed by Section 1501.12(A).
(c) The Tax Administrator may require a taxpayer to use an alternative apportionment method as
described in division (F)(2)(a) of this section, but only by issuing an assessment to the taxpayer within the
period prescribed by Section 1501.12 (A).
(d) Nothing in division (F)(2) of this section nullifies or otherwise affects any alternative
apportionment arrangement approved by the Tax Administrator or otherwise agreed upon by both the Tax
Administrator and taxpayer before January 1, 2016.
(3) As used in division (F)(1)(b) of this section, "wages, salaries, and other compensation" includes only
wages, salaries, or other compensation paid to an employee for services performed at any of the following
locations:
(a) A location that is owned, controlled, or used by, rented to, or under the possession of one of the
following:
(i) The employer;
(ii) A vendor, customer, client, or patient of the employer, or a related member of such a vendor,
customer, client, or patient;
(iii) A vendor, customer, client, or patient of a person described in (F)(3)(a)(ii) of this section, or a
related member of such a vendor, customer, client, or patient.
(b) Any location at which a trial, appeal, hearing, investigation, inquiry, review, court-martial, or
similar administrative, judicial, or legislative matter or proceeding is being conducted, provided that the
compensation is paid for services performed for, or on behalf of, the employer or that the employee's
presence at the location directly or indirectly benefits the employer;
(c) Any other location, if the Tax Administrator determines that the employer directed the employee
to perform the services at the other location in lieu of a location described in division (F) (3)(a) or (b) of
19
this section solely in order to avoid or reduce the employer's municipal income tax liability. If the Tax
Administrator makes such a determination, the employer may dispute the determination by establishing, by
a preponderance of the evidence, that the Tax Administrator's determination was unreasonable.
(4) For the purposes of division (F)(1)(c) of this section, and except as provided in division (G) of this
section, receipts from sales and rentals made and services performed shall be sitused to a municipal
corporation as follows:
(a) Gross receipts from the sale of tangible personal property shall be sitused to the municipal
corporation in which the sale originated. For the purposes of this division, a sale of property originates in
the City if, regardless of where title passes, the property meets any of the following criteria:
(i) The property is shipped to or delivered within the City from a stock of goods located within the
City.
(ii) The property is delivered within the City from a location outside the City, provided the taxpayer
is regularly engaged through its own employees in the solicitation or promotion of sales within the City and
the sales result from such solicitation or promotion.
(iii) The property is shipped from a place within the City to purchasers outside the City, provided
that the taxpayer is not, through its own employees, regularly engaged in the solicitation or promotion of
sales at the place where delivery is made.
(b) Gross receipts from the sale of services shall be sitused to the City to the extent that such services
are performed in the City.
(c) To the extent included in income, gross receipts from the sale of real property located in the City
shall be sitused to the City.
(d) To the extent included in income, gross receipts from rents and royalties from real property located
in the City shall be sitused to the City.
(e) Gross receipts from rents and royalties from tangible personal property shall be sitused to the City
based upon the extent to which the tangible personal property is used in the City.
(5) The net profit received by an individual taxpayer from the rental of real estate owned directly by the
individual, or by a disregarded entity owned by the individual, shall be subject to the City’s tax only if the
property generating the net profit is located in the City or if the individual taxpayer that receives the net
profit is a resident of the City. the City shall allow such taxpayers to elect to use separate accounting for
the purpose of calculating net profit sitused under this division to the municipal corporation in which the
property is located.
(6)(a) Commissions received by a real estate agent or broker relating to the sale, purchase, or lease of
real estate shall be sitused to the municipal corporation in which the real estate is located. Net profit reported
by the real estate agent or broker shall be allocated to the City, if applicable, based upon the ratio of the
commissions the agent or broker received from the sale, purchase, or lease of real estate located in the City
to the commissions received from the sale, purchase, or lease of real estate everywhere in the taxable year.
20
(b) An individual who is a resident of the City shall report the individual's net profit from all real
estate activity on the individual's annual tax return for the City. The individual may claim a credit for taxes
the individual paid on such net profit to another municipal corporation to the extent that such a credit is
allowed under the City’s income tax ordinance.
(7) When calculating the ratios described in division (F)(1) of this section for the purposes of that division
or division (F)(2) of this section, the owner of a disregarded entity shall include in the owner's ratios the
property, payroll, and gross receipts of such disregarded entity.
(8) Left intentionally blank.
(9) Intentionally left blank.
(G)(1) As used in this division:
(a) "Qualifying remote employee or owner" means an individual who is an employee of a taxpayer or
who is a partner or member holding an ownership interest in a taxpayer that is treated as a partnership for
federal income tax purposes, provided that the individual meets both of the following criteria:
(i) The taxpayer has assigned the individual to a qualifying reporting location.
(ii) The individual is permitted or required to perform services for the taxpayer at a qualifying
remote work location.
(b) "Qualifying remote work location" means a permanent or temporary location at which an employee
or owner chooses or is required to perform services for the taxpayer, other than a reporting location of the
taxpayer or any other location owned or controlled by a customer or client of the taxpayer. "Qualifying
remote work location" may include the residence of an employee or owner and may be located outside of a
municipal corporation that imposes an income tax in accordance with this chapter. An employee or owner
may have more than one qualifying remote work location during a taxable year.
(c) "Reporting location" means either of the following:
(i) A permanent or temporary place of doing business, such as an office, warehouse, storefront,
construction site, or similar location, that is owned or controlled directly or indirectly by the taxpayer;
(ii) Any location in this state owned or controlled by a customer or client of the taxpayer, provided
that the taxpayer is required to withhold taxes under Section 1501.04 of this Chapter, on qualifying wages
paid to an employee for the performance of personal services at that location.
(d) "Qualifying reporting location" means one of the following:
(i) The reporting location in this state at which an employee or owner performs services for the
taxpayer on a regular or periodic basis during the taxable year;
(ii) If no reporting location exists in this state for an employee or owner under division (G)(1)(d)(i)
of this section, the reporting location in this state at which the employee's or owner's supervisor regularly
or periodically reports during the taxable year;
21
(iii) If no reporting location exists in this state for an employee or owner under division (G)(1)(d)(i)
or (ii) of this section, the location that the taxpayer otherwise assigns as the employee's or owner's qualifying
reporting location, provided the assignment is made in good faith and is recorded and maintained in the
taxpayer's business records. A taxpayer may change the qualifying reporting location designated for an
employee or owner under this division at any time.
(2) For tax years ending on or after December 31, 2023, a taxpayer may elect to apply the provisions of
this division to the apportionment of its net profit from a business or profession. For taxpayers that make
this election, the provisions of division (F) of this section apply to such apportionment except as otherwise
provided in this division.
A taxpayer shall make the election allowed under this division in writing on or with the taxpayer's net profit
return or, if applicable, a timely filed amended net profit return or a timely filed appeal of an assessment.
The election applies to the taxable year for which that return or appeal is filed and for all subsequent taxable
years, until the taxpayer revokes the election.
The taxpayer shall make the initial election with the tax administrator of each municipal corporation with
which, after applying the apportionment provisions authorized in this division, the taxpayer is required to
file a net profit tax return for that taxable year. A taxpayer shall not be required to notify the tax
administrator of a municipal corporation in which a qualifying remote employee's or owner's qualifying
remote work location is located, unless the taxpayer is otherwise required to file a net profit return with that
municipal corporation due to business operations that are unrelated to the employee's or owner's activity at
the qualifying remote work location.
After the taxpayer makes the initial election, the election applies to every municipal corporation in which
the taxpayer conducts business. The taxpayer shall not be required to file a net profit return with a municipal
corporation solely because a qualifying remote employee's or owner's qualifying remote work location is
located in such municipal corporation.
Nothing in this division prohibits a taxpayer from making a new election under this division after properly
revoking a prior election.
(3) For the purpose of calculating the ratios described in division (F)(1) of this section, all of the following
apply to a taxpayer that has made the election described in division (G)(2):
(a) For the purpose of division (F)(1)(a) of this section, the average original cost of any tangible
personal property used by a qualifying remote employee or owner at that individual's qualifying remote
work location shall be sitused to that individual's qualifying reporting location.
(b) For the purpose of division (F)(1)(b) of this section, any wages, salaries, and other compensation
paid during the taxable period to a qualifying remote employee or owner for services performed at that
individual's qualifying remote work location shall be sitused to that individual's qualifying reporting
location.
(c) For the purpose of division (F)(1)(c) of this section, and notwithstanding division (F)(4) of this
section, any gross receipts of the business or profession from services performed during the taxable period
by a qualifying remote employee or owner for services performed at that individual's qualifying remote
work location shall be sitused to that individual's qualifying reporting location.
22
(4) Nothing in this division prevents a taxpayer from requesting, or a tax administrator from requiring, that
the taxpayer use, with respect to all or a portion of the income of the taxpayer, an alternative apportionment
method as described in division (F)(2) of this section. However, a tax administrator shall not require an
alternative apportionment method in such a manner that it would require a taxpayer to file a net profit return
with a municipal corporation solely because a qualifying remote employee's or owner's qualifying remote
work location is located in that municipal corporation.
(5) Except as otherwise provided in this division, nothing in this division is intended to affect the
withholding of taxes on qualifying wages pursuant to Section 1501.04 of this Chapter.
1501.04 COLLECTION AT SOURCE.
Withholding provisions.
(A) Each employer, agent of an employer, or other payer located or doing business in the City shall withhold
an income tax from the qualifying wages earned and/or received by each employee in the City. Except for
qualifying wages for which withholding is not required under Section 1501.03 or division (B)(4) or (6) of
this section, the tax shall be withheld at the rate, specified in Section 1501.03 of this Chapter of 2.0%. An
employer, agent of an employer, or other payer shall deduct and withhold the tax from qualifying wages on
the date that the employer, agent, or other payer directly, indirectly, or constructively pays the qualifying
wages to, or credits the qualifying wages to the benefit of, the employee.
(B)(1) Except as provided in division (B)(2) of this section, an employer, agent of an employer, or other
payer shall remit to the Tax Administrator of the City the greater of the income taxes deducted and withheld
or the income taxes required to be deducted and withheld by the employer, agent, or other payer according
to the following schedule:
(a) Taxes required to be deducted and withheld shall be remitted monthly to the Tax Administrator if
the total taxes deducted and withheld or required to be deducted and withheld by the employer, agent, or
other payer on behalf of the City in the preceding calendar year exceeded $2,399, or if the total amount of
taxes deducted and withheld or required to be deducted and withheld on behalf of the City in any month of
the preceding calendar quarter exceeded $200.
Payments under division (B)(1)(a) of this section shall be made to the Tax Administrator not later than 15
days after the last day of each month for which the tax was withheld.
(b) Any employer, agent of an employer, or other payer not required to make payments under division
(B)(1)(a) of this section of taxes required to be deducted and withheld shall make quarterly payments to the
Tax Administrator not later than the last day of the month following the last day of each calendar quarter.
(c) Intentionally left blank.
(2) If the employer, agent of an employer, or other payer is required to make payments electronically
for the purpose of paying federal taxes withheld on payments to employees under Section 6302 of the
Internal Revenue Code, 26 C.F.R. 31.6302-1, or any other federal statute or regulation, the payment shall
be made by electronic funds transfer to the Tax Administrator of all taxes deducted and withheld on behalf
of the City. The payment of tax by electronic funds transfer under this division does not affect an employer's,
agent's, or other payer's obligation to file any return as required under this section.
23
(3) An employer, agent of an employer, or other payer shall make and file a return showing the amount
of tax withheld by the employer, agent, or other payer from the qualifying wages of each employee and
remitted to the Tax Administrator. A return filed by an employer, agent, or other payer under this division
shall be accepted by Tax Administrator and the City as the return required of a non-resident employee
whose sole income subject to the tax under this Chapter is the qualifying wages reported by the employee's
employer, agent of an employer, or other payer.
(4) An employer, agent of an employer, or other payer is not required to withhold the City income tax
with respect to an individual's disqualifying disposition of an incentive stock option if, at the time of the
disqualifying disposition, the individual is not an employee of either the corporation with respect to whose
stock the option has been issued or of such corporation's successor entity.
(5)(a) An employee is not relieved from liability for a tax by the failure of the employer, agent of an
employer, or other payer to withhold the tax as required under this Chapter or by the employer's, agent's,
or other payer's exemption from the requirement to withhold the tax.
(b) The failure of an employer, agent of an employer, or other payer to remit to the City the tax
withheld relieves the employee from liability for that tax unless the employee colluded with the employer,
agent, or other payer in connection with the failure to remit the tax withheld.
(6) Compensation deferred before June 26, 2003, is not subject to the City income tax or income tax
withholding requirement to the extent the deferred compensation does not constitute qualifying wages at
the time the deferred compensation is paid or distributed.
(7) Each employer, agent of an employer, or other payer required to withhold taxes is liable for the
payment of that amount required to be withheld, whether or not such taxes have been withheld, and such
amount shall be deemed to be held in trust for the City until such time as the withheld amount is remitted
to the Tax Administrator.
(8) On or before the last day of February of each year, an employer shall file a withholding reconciliation
return with the Tax Administrator listing:
(a) The names, addresses, and social security numbers of all employees from whose qualifying wages
tax was withheld or should have been withheld for the City during the preceding calendar year;
(b) The amount of tax withheld, if any, from each such employee, the total amount of qualifying
wages paid to such employee during the preceding calendar year;
(c) The name of every other municipal corporation for which tax was withheld or should have been
withheld from such employee during the preceding calendar yea;
(d) Any other information required for federal income tax reporting purposes on Internal Revenue
Service form W-2 or its equivalent form with respect to such employee;
(e) Other information as may be required by the Tax Administrator.
(9) The officer or the employee of the employer, agent of an employer, or other payer with control or
direct supervision of or charged with the responsibility for withholding the tax or filing the reports and
making payments as required by this section, shall be personally liable for a failure to file a report or pay
24
the tax due as required by this section. The dissolution of an employer, agent of an employer, or other payer
does not discharge the officer's or employee's liability for a failure of the employer, agent of an employer,
or other payer to file returns or pay any tax due.
(10) An employer is required to deduct and withhold the City income tax on tips and gratuities received
by the employer's employees and constituting qualifying wages, but only to the extent that the tips and
gratuities are under the employer's control. For the purposes of this division, a tip or gratuity is under the
employer's control if the tip or gratuity is paid by the customer to the employer for subsequent remittance
to the employee, or if the customer pays the tip or gratuity by credit card, debit card, or other electronic
means.
(11) The Tax Administrator shall consider any tax withheld by an employer at the request of an employee,
when such tax is not otherwise required to be withheld by this Chapter, to be tax required to be withheld
and remitted for the purposes of this section
Occasional Entrant - Withholding.
(C)(1) As used in this division:
(a) "Employer" includes a person that is a related member to or of an employer.
(b) "Fixed location" means a permanent place of doing business in this state, such as an office,
warehouse, storefront, or similar location owned or controlled by an employer.
(c) "Principal place of work" means the fixed location to which an employee is required to report for
employment duties on a regular and ordinary basis. If the employee is not required to report for employment
duties on a regular and ordinary basis to a fixed location, "principal place of work" means the worksite
location in this state to which the employee is required to report for employment duties on a regular and
ordinary basis. If the employee is not required to report for employment duties on a regular and ordinary
basis to a fixed location or worksite location, "principal place of work" means the location in this state at
which the employee spends the greatest number of days in a calendar year performing services for or on
behalf of the employee's employer.
If there is not a single municipal corporation in which the employee spent the "greatest number of days in
a calendar year" performing services for or on behalf of the employer, but instead there are two or more
municipal corporations in which the employee spent an identical number of days that is greater than the
number of days the employee spent in any other municipal corporation, the employer shall allocate any of
the employee's qualifying wages subject to division (C)(2)(a)(i) of this section among those two or more
municipal corporations. The allocation shall be made using any fair and reasonable method, including, but
not limited to, an equal allocation among such municipal corporations or an allocation based upon the time
spent or sales made by the employee in each such municipal corporation. A municipal corporation to which
qualifying wages are allocated under this division shall be the employee's "principal place of work" with
respect to those qualifying wages for the purposes of this section.
For the purposes of this division, the location at which an employee spends a particular day shall be
determined in accordance with division (C)(2)(b) of this section, except that "location" shall be substituted
for "municipal corporation" wherever "municipal corporation" appears in that division.
(d) "Professional athlete" means an athlete who performs services in a professional athletic event for
wages or other remuneration.
25
(e) "Professional entertainer" means a person who performs services in the professional performing
arts for wages or other remuneration on a per-event basis.
(f) "Public figure" means a person of prominence who performs services at discrete events, such as
speeches, public appearances, or similar events, for wages or other remuneration on a per-event basis.
(g) "Worksite location" means a construction site or other temporary worksite in this state at which
the employer provides services for more than 20 days during the calendar year. "Worksite location" does
not include the home of an employee.
(2)(a) Subject to divisions (C)(3), (5), (6), and (7) of this section, an employer is not required to withhold
the City income tax on qualifying wages paid to an employee for the performance of personal services in
the City if the employee performed such services in the City on 20 or fewer days in a calendar year, unless
one of the following conditions applies:
(i) The employee's principal place of work is located in the City.
(ii) The employee performed services at one or more presumed worksite locations in the City. For
the purposes of this division, "presumed worksite location" means a construction site or other temporary
worksite in the City at which the employer provides or provided services that can reasonably be, or would
have been, expected by the employer to last more than 20 days in a calendar year. Services can "reasonably
be expected by the employer to last more than 20 days" if either of the following applies at the time the
services commence:
(a) The nature of the services are such that it will require more than 20 days of the services to
complete the services;
(b) The agreement between the employer and its customer to perform services at a location
requires the employer to perform the services at the location for more than 20 days.
(iii) The employee is a resident of the City and has requested that the employer withhold tax from
the employee's qualifying wages as provided in Section 1501.04.
(iv) The employee is a professional athlete, professional entertainer, or public figure, and the
qualifying wages are paid for the performance of services in the employee's capacity as a professional
athlete, professional entertainer, or public figure.
(b) For the purposes of division (C)(2)(a) of this section, an employee shall be considered to have
spent a day performing services in the City only if the employee spent more time performing services for
or on behalf of the employer in the City than in any other municipal corporation on that day. For the
purposes of determining the amount of time an employee spent in a particular location, the time spent
performing one or more of the following activities shall be considered to have been spent at the employee's
principal place of work:
(i) Traveling to the location at which the employee will first perform services for the employer for
the day;
(ii) Traveling from a location at which the employee was performing services for the employer to
any other location;
26
(iii) Traveling from any location to another location in order to pick up or load, for the purpose of
transportation or delivery, property that has been purchased, sold, assembled, fabricated, repaired,
refurbished, processed, remanufactured, or improved by the employee's employer;
(iv) Transporting or delivering property described in division (C)(2)(b)(iii) of this section, provided
that, upon delivery of the property, the employee does not temporarily or permanently affix the property to
real estate owned, used, or controlled by a person other than the employee's employer;
(v) Traveling from the location at which the employee makes the employee's final delivery or pick-
up for the day to either the employee's principal place of work or a location at which the employee will not
perform services for the employer.
(3) If the principal place of work of an employee is located in another Ohio municipal corporation that
imposes an income tax, the exception from withholding requirements described in division (C)(2)(a) of this
section shall apply only if, with respect to the employee's qualifying wages described in that division, the
employer withholds and remits tax on such qualifying wages to that municipal corporation.
(4)(a) Except as provided in division (C)(4)(b) of this section, if, during a calendar year, the number of
days an employee spends performing personal services in the City exceeds the 20-day threshold, the
employer shall withhold and remit tax to the City for any subsequent days in that calendar year on which
the employer pays qualifying wages to the employee for personal services performed in the City.
(b) An employer required to begin withholding tax for the City under division (C)(4)(a) of this section
may elect to withhold tax for the City for the first 20 days on which the employer paid qualifying wages to
the employee for personal services performed in the City.
(5) If an employer’s fixed location is the City and the employer qualifies as a small employer as defined
in Section 1501.02, the employer shall withhold municipal income tax on all of the employee's qualifying
wages for a taxable year and remit that tax only to the City, regardless of the number of days which the
employee worked outside the corporate boundaries of the City.
To determine whether an employer qualifies as a small employer for a taxable year, the employer will be
required to provide the Tax Administrator with the employer's federal income tax return for the preceding
taxable year.
(6) Divisions (C)(2)(a) and (4) of this section shall not apply to the extent that the Tax Administrator and
an employer enter into an agreement regarding the manner in which the employer shall comply with the
requirements of Section 1501.04.
1501.05 ANNUAL RETURN; FILING.
(A) An annual the City income tax return shall be completed and filed by every taxpayer for each taxable
year for which the taxpayer is subject to the tax, whether or not a tax is due thereon.
(1) The Tax Administrator may accept on behalf of all nonresident individual taxpayers a return filed
by an employer, agent of an employer, or other payer under Section 1501.05 of this Chapter when the
nonresident individual taxpayer’s sole income subject to the tax is the qualifying wages reported by the
employer, agent of an employer, or other payer, and no additional tax is due the City.
27
(2) Retirees having no Municipal Taxable Income for the City income tax purposes may file with the
Tax Administrator a written exemption from these filing requirements on a form prescribed by the Tax
Administrator. The written exemption shall indicate the date of retirement and the entity from which
retired. The exemption shall be in effect until such time as the retiree receives Municipal Taxable Income
taxable to the City, at which time the retiree shall be required to comply with all applicable provisions of
this ordinance/chapter.
(B) If an individual is deceased, any return or notice required of that individual shall be completed and
filed by that decedent's executor, administrator, or other person charged with the property of that decedent.
(C) If an individual is unable to complete and file a return or notice required by the City, the return or
notice required of that individual shall be completed and filed by the individual's duly authorized agent,
guardian, conservator, fiduciary, or other person charged with the care of the person or property of that
individual.
(D) Returns or notices required of an estate or a trust shall be completed and filed by the fiduciary of the
estate or trust.
(E) the City shall permit spouses to file a joint return.
(F)(1) Each return required to be filed under this division shall contain the signature of the taxpayer or
the taxpayer's duly authorized agent and of the person who prepared the return for the taxpayer. The return
shall include the taxpayer's social security number or taxpayer identification number. Each return shall be
verified by a declaration under penalty of perjury.
(2) The Tax Administrator shall require a taxpayer who is an individual to include, with each annual
return, and amended return, copies of the following documents: all of the taxpayer's Internal Revenue
Service form W-2, "Wage and Tax Statements," including all information reported on the taxpayer's federal
W-2, as well as taxable wages reported or withheld for any municipal corporation; the taxpayer's Internal
Revenue Service form 1040 or, in the case of a return or request required by a qualified municipal corporation, Ohio
form IT-1040; and, with respect to an amended tax return, any other documentation necessary to support the
adjustments made in the amended return. An individual taxpayer who files the annual return required by
this section electronically is not required to provide paper copies of any of the foregoing to the Tax
Administrator unless the Tax Administrator requests such copies after the return has been filed.
(3) The Tax Administrator may require a taxpayer that is not an individual to include, with each annual
net profit return, amended net profit return, or request for refund required under this section, copies of only
the following documents: the taxpayer's Internal Revenue Service form 1041, form 1065, form 1120, form
1120-REIT, form 1120F, or form 1120S, and, with respect to an amended tax return or refund request, any
other documentation necessary to support the refund request or the adjustments made in the amended return.
A taxpayer that is not an individual and that files an annual net profit return electronically through the Ohio
Business Gateway or in some other manner shall either mail the documents required under this division to
the Tax Administrator at the time of filing or, if electronic submission is available, submit the documents
electronically through the Ohio Business Gateway.
(4) After a taxpayer files a tax return, the Tax Administrator may request, and the taxpayer shall
provide, any information, statements, or documents required by the City to determine and verify the
taxpayer's municipal income tax liability. The requirements imposed under division (F) of this section apply
regardless of whether the taxpayer files on a generic form or on a form prescribed by the Tax Administrator.
28
(G)(1)(a) Except as otherwise provided in this chapter/ordinance, each individual income tax
return required to be filed under this section shall be completed and filed as required by the Tax
Administrator on or before the date prescribed for the filing of state individual income tax returns
under division (G) of Section 5747.08 of the ORC. The taxpayer shall complete and file the return or
notice on forms prescribed by the Tax Administrator or on generic forms, together with remittance made
payable to the City. No remittance is required if the net amount due is ten dollars or less.
(b) Except as otherwise provided in this chapter/ordinance, each annual net profit return required to
be filed under this section by a taxpayer that is not an individual shall be completed and filed as required
by the Tax Administrator on or before the fifteenth day (15th) of the fourth month following the end of
the taxpayer’s taxable year. The taxpayer shall complete and file the return or notice on forms prescribed
by the Tax Administrator or on generic forms, together with remittance made payable to the City. No
remittance is required if the net amount due is ten dollars or less.
(2) Any taxpayer that has duly requested an automatic six-month extension for filing the taxpayer's
federal income tax return shall automatically receive an extension for the filing of the City’s income tax
return. The extended due date of the City’s income tax return shall be the 15th day of the tenth month after
the last day of the taxable year to which the return relates. For tax years ending on or after January 1, 2023,
the extended due date of the City’s income tax return for a taxpayer that is not an individual shall be the
15th day of the eleventh month after the last day of the taxable year to which the return relates. An extension
of time to file under this division is not an extension of the time to pay any tax due unless the Tax
Administrator grants an extension of that date.
(a) A copy of the federal extension request shall be included with the filing of the City’s income tax
return.
(b) A taxpayer that has not requested or received a six-month extension for filing the taxpayer’s
federal income tax return may request that the Tax Administrator grant the taxpayer a six-month extension
of the date for filing the taxpayer’s the City income tax return. If the request is received by the Tax
Administrator on or before the date the City income tax return is due, the Tax Administrator shall grant the
taxpayer’s requested extension.
(3) If the tax commissioner extends for all taxpayers the date for filing state income tax returns under
division (G) of Section 5747.08 of the ORC, a taxpayer shall automatically receive an extension for the
filing of the City’s income tax return. The extended due date of the City’s income tax return shall be the
same as the extended due date of the state income tax return.
(4) If the Tax Administrator considers it necessary in order to ensure the payment of the tax imposed by
the City, the Tax Administrator may require taxpayers to file returns and make payments otherwise than as
provided in this division, including taxpayers not otherwise required to file annual returns.
(5) If a taxpayer receives an extension for the filing of a municipal income tax return under division
(G)(2), (3), or (4) of this section, the tax administrator shall not make any inquiry or send any notice to the
taxpayer with regard to the return on or before the date the taxpayer files the return or on or before the
extended due date to file the return, whichever occurs first.
If a tax administrator violates division (G)(5) of this section, the municipal corporation shall reimburse the
taxpayer for any reasonable costs incurred to respond to such inquiry or notice, up to $150.
29
Division (G)(5) of this section does not apply to an extension received under division (G)(2) of this section
if the tax administrator has actual knowledge that the taxpayer failed to file for a federal extension as
required to receive the extension under division (G)(2) of this section or failed to file for an extension under
division (G)(2)(b) of this section.
(6) To the extent that any provision in this division (G) of this section conflicts with any provision in
divisions (N), (O), (P), or (Q) of this section, the provisions in divisions (N), (O), (P), or (Q) prevail.
(H)(1) For taxable years beginning after 2015, the City shall not require a taxpayer to remit tax with respect
to net profits if the net amount due is ten dollars or less.
(2) Any taxpayer not required to remit tax to the City for a taxable year pursuant to division (H)(1) of
this section shall file with the City an annual net profit return under division (F)(3) of this section, unless
the provisions of division (H)(3) apply.
(3)(a) A person may notify the Tax Administrator that the person does not expect to be a taxpayer
subject to the City income tax ordinance for a taxable year if both the following apply:
(i) The person was required to file a tax return with the City for the immediately preceding taxable
year because the person performed services at a worksite location (as defined in Section 1501.04(C)(1)(g))
within the City.
(ii) The person no longer provides services in the City and does not expect to be subject to the
City income tax for the taxable year.
(b) The person shall provide the notice in a signed affidavit that briefly explains the person’s
circumstances, including the location of the previous worksite location and the last date on which the person
performed services or made any sales within the City. The affidavit shall also include the following
statement: “The affiant has no plans to perform any services within the City, make any sales in the City, or
otherwise become subject to the tax levied by the City during the taxable year. If the affiant does become
subject to the tax levied by the City for the taxable year, the affiant agrees to be considered a taxpayer and
to properly comply as a taxpayer with the City income tax ordinance and rules and regulations.” The person
shall sign the affidavit under penalty of perjury.
(c) If a person submits an affidavit described in division (H)(3)(b) the Tax Administrator shall not
require the person to file and tax return for the taxable year unless the Tax Administrator possesses
information that conflicts with the affidavit or if the circumstances described in the affidavit change.
(d) Nothing in division (H)(3) of this section prohibits the Tax Administrator from performing an
audit of the person.
(I) If a payment under this chapter is made by electronic funds transfer, the payment shall be considered to
be made on the date of the timestamp assigned by the first electronic system.
(J) Taxes withheld for the City by an employer, the agent of an employer, or other payer as described in
Section 1501.04 shall be allowed to the taxpayer as credits against payment of the tax imposed on the
taxpayer by the City, unless the amounts withheld were not remitted to the City and the recipient colluded
with the employer, agent, or other payer in connection with the failure to remit the amounts withheld.
30
(K) Each return required by the City to be filed in accordance with this division shall include a box that the
taxpayer may check to authorize another person, including a tax return preparer who prepared the return,
to communicate with the Tax Administrator about matters pertaining to the return.
(L) The Tax Administrator shall accept for filing a generic form of any income tax return, report, or
document required by the City, provided that the generic form, once completed and filed, contains all of
the information required by ordinance, resolution, or rules and regulations adopted by the City or the Tax
Administrator, and provided that the taxpayer or tax return preparer filing the generic form otherwise
complies with the provisions of this Chapter and of the City’s ordinance, resolution, or rules and regulations
governing the filing of returns, reports, or documents.
Filing via Ohio Business Gateway.
(M)(1) Any taxpayer subject to municipal income taxation with respect to the taxpayer's net profit from a
business or profession may file the City’s income tax return, estimated municipal income tax return, or
extension for filing a municipal income tax return, and may make payment of amounts shown to be due on
such returns, by using the Ohio Business Gateway.
(2) Any employer, agent of an employer, or other payer may report the amount of municipal income
tax withheld from qualifying wages, and may make remittance of such amounts, by using the Ohio Business
Gateway.
(3) Nothing in this section affects the due dates for filing employer withholding tax returns.
Extension for service in or for the armed forces.
(N) Each member of the national guard of any state and each member of a reserve component of the armed
forces of the United States called to active duty pursuant to an executive order issued by the president of
the United States or an act of the congress of the United States, and each civilian serving as support
personnel in a combat zone or contingency operation in support of the armed forces, may apply to the Tax
Administrator of the City for both an extension of time for filing of the return and an extension of time for
payment of taxes required by the City during the period of the member's or civilian's duty service, and for
180 days thereafter. The application shall be filed on or before the one hundred eightieth day after the
member's or civilian's duty terminates. An applicant shall provide such evidence as the Tax Administrator
considers necessary to demonstrate eligibility for the extension.
(O)(1) If the Tax Administrator ascertains that an applicant is qualified for an extension under this section,
the Tax Administrator shall enter into a contract with the applicant for the payment of the tax in installments
that begin on the 181st day after the applicant's active duty or service terminates. The Tax Administrator
may prescribe such contract terms as the Tax Administrator considers appropriate. However, taxes pursuant
to a contract entered into under this division are not delinquent, and the Tax Administrator shall not require
any payments of penalties or interest in connection with those taxes for the extension period.
(2) If the Tax Administrator determines that an applicant is qualified for an extension under this section,
the applicant shall neither be required to file any return, report, or other tax document nor be required to
pay any tax otherwise due to the City before the 181st day after the applicant's active duty or service
terminates.
31
(3) Taxes paid pursuant to a contract entered into under (O)(1) of this division are not delinquent. The
Tax Administrator shall not require any payments of penalties or interest in connection with those taxes for
the extension period.
(P)(1) Nothing in this division denies to any person described in this division the application of divisions
(N) and (O) of this section.
(2)(a) A qualifying taxpayer who is eligible for an extension under the Internal Revenue Code shall
receive both an extension of time in which to file any return, report, or other tax document and an extension
of time in which to make any payment of taxes required by the City in accordance with this Chapter. The
length of any extension granted under division (P)(2)(a) of this section shall be equal to the length of the
corresponding extension that the taxpayer receives under the Internal Revenue Code. As used in this
division, "qualifying taxpayer" means a member of the national guard or a member of a reserve component
of the armed forces of the United States called to active duty pursuant to either an executive order issued
by the president of the United States or an act of the congress of the United States, or a civilian serving as
support personnel in a combat zone or contingency operation in support of the armed forces.
(b) Taxes whose payment is extended in accordance with division (P)(2)(a) of this section are not
delinquent during the extension period. Such taxes become delinquent on the first day after the expiration
of the extension period if the taxes are not paid prior to that date. The Tax Administrator shall not require
any payment of penalties or interest in connection with those taxes for the extension period. The Tax
Administrator shall not include any period of extension granted under division (C)(2)(a) of this section in
calculating the penalty or interest due on any unpaid tax.
(Q) For each taxable year to which division (N), (O), or (P) of this section applies to a taxpayer, the
provisions of divisions (O)(2) and (3) of this section, as applicable, apply to the spouse of that taxpayer if
the filing status of the spouse and the taxpayer is married filing jointly for that year.
Consolidated municipal income tax return.
(R) As used in this section:
(1) "Affiliated group of corporations" means an affiliated group as defined in Section 1504 of the Internal
Revenue Code, except that, if such a group includes at least one incumbent local exchange carrier that is
primarily engaged in the business of providing local exchange telephone service in this state, the affiliated
group shall not include any incumbent local exchange carrier that would otherwise be included in the group.
(2) "Consolidated federal income tax return" means a consolidated return filed for federal income tax
purposes pursuant to Section 1501 of the Internal Revenue Code.
(3) "Consolidated federal taxable income" means the consolidated taxable income of an affiliated group
of corporations, as computed for the purposes of filing a consolidated federal income tax return, before
consideration of net operating losses or special deductions. "Consolidated federal taxable income" does not
include income or loss of an incumbent local exchange carrier that is excluded from the affiliated group
under division (R)(1) of this section.
(4) "Incumbent local exchange carrier" has the same meaning as in Section 4927.01 of the ORC.
(5) "Local exchange telephone service" has the same meaning as in Section 5727.01 of the ORC.
32
(S)(1) For taxable years beginning on or after January 1, 2016, a taxpayer that is a member of an affiliated
group of corporations may elect to file a consolidated municipal income tax return for a taxable year if at
least one member of the affiliated group of corporations is subject to the City’s income tax in that taxable
year, and if the affiliated group of corporations filed a consolidated federal income tax return with respect
to that taxable year. The election is binding for a five-year period beginning with the first taxable year of
the initial election unless a change in the reporting method is required under federal law. The election
continues to be binding for each subsequent five-year period unless the taxpayer elects to discontinue filing
consolidated municipal income tax returns under division (S)(2) of this section or a taxpayer receives
permission from the Tax Administrator. The Tax Administrator shall approve such a request for good cause
shown.
(2) An election to discontinue filing consolidated municipal income tax returns under this section must
be made in the first year following the last year of a five-year consolidated municipal income tax return
election period in effect under division (S)(1) of this section. The election to discontinue filing a
consolidated municipal income tax return is binding for a five-year period beginning with the first taxable
year of the election.
(3) An election made under division (S)(1) or (2) of this section is binding on all members of the
affiliated group of corporations subject to a municipal income tax.
(4) When a taxpayer makes the election allowed under section 718.80 of the ORC, a valid election made
by a taxpayer under division (S)(1) or (2) of this section is binding upon the Tax Commissioner for the
remainder of the five-year period.
(5) When an election is made under section 718.80 of the ORC is terminated, valid election made under
section 718.86 of the ORC is binding upon the Tax Administrator for the remainder of the five-year period.
(T) A taxpayer that is a member of an affiliated group of corporations that filed a consolidated federal
income tax return for a taxable year shall file a consolidated the City income tax return for that taxable year
if the Tax Administrator determines, by a preponderance of the evidence, that intercompany transactions
have not been conducted at arm's length and that there has been a distortive shifting of income or expenses
with regard to allocation of net profits to the City. A taxpayer that is required to file a consolidated the City
income tax return for a taxable year shall file a consolidated the City income tax return for all subsequent
taxable years, unless the taxpayer requests and receives written permission from the Tax Administrator to
file a separate return or a taxpayer has experienced a change in circumstances.
(U) A taxpayer shall prepare a consolidated the City income tax return in the same manner as is required
under the United States department of treasury regulations that prescribe procedures for the preparation of
the consolidated federal income tax return required to be filed by the common parent of the affiliated group
of which the taxpayer is a member.
(V)(1) Except as otherwise provided in divisions (V)(2), (3), and (4) of this section, corporations that file a
consolidated municipal income tax return shall compute adjusted federal taxable income, as defined in
Section 1501.02, by substituting "consolidated federal taxable income" for "federal taxable income"
wherever "federal taxable income" appears in that division and by substituting "an affiliated group of
corporation's" for "a C corporation's" wherever "a C corporation's" appears in that division.
(2) No corporation filing a consolidated the City income tax return shall make any adjustment otherwise
required under Section (2)(C)(1) to the extent that the item of income or deduction otherwise subject to the
adjustment has been eliminated or consolidated in the computation of consolidated federal taxable income.
33
(3) If the net profit or loss of a pass-through entity having at least eighty percent (80%) of the value of
its ownership interest owned or controlled, directly or indirectly, by an affiliated group of corporations is
included in that affiliated group's consolidated federal taxable income for a taxable year, the corporation
filing a consolidated the City income tax return shall do one of the following with respect to that pass-
through entity's net profit or loss for that taxable year:
(a) Exclude the pass-through entity's net profit or loss from the consolidated federal taxable income
of the affiliated group and, for the purpose of making the computations required in divisions (R) through
(Y) of Section 1501.05, exclude the property, payroll, and gross receipts of the pass-through entity in the
computation of the affiliated group's net profit sitused to the City. If the entity's net profit or loss is so
excluded, the entity shall be subject to taxation as a separate taxpayer on the basis of the entity's net profits
that would otherwise be included in the consolidated federal taxable income of the affiliated group.
(b) Include the pass-through entity's net profit or loss in the consolidated federal taxable income of
the affiliated group and, for the purpose of making the computations required in divisions (R) through (Y)
of Section 1501.05, include the property, payroll, and gross receipts of the pass-through entity in the
computation of the affiliated group's net profit sitused to the City. If the entity's net profit or loss is so
included, the entity shall not be subject to taxation as a separate taxpayer on the basis of the entity's net
profits that are included in the consolidated federal taxable income of the affiliated group.
(4) If the net profit or loss of a pass-through entity having less than eighty percent of the value of its
ownership interest owned or controlled, directly or indirectly, by an affiliated group of corporations is
included in that affiliated group's consolidated federal taxable income for a taxable year, all of the following
shall apply:
(a) The corporation filing the consolidated municipal income tax return shall exclude the pass-
through entity's net profit or loss from the consolidated federal taxable income of the affiliated group and,
for the purposes of making the computations required in divisions (R) through (Y) of Section 1501.05,
exclude the property, payroll, and gross receipts of the pass-through entity in the computation of the
affiliated group's net profit sitused to the City;
(b) The pass-through entity shall be subject to the City income taxation as a separate taxpayer in
accordance with this Chapter on the basis of the entity's net profits that would otherwise be included in the
consolidated federal taxable income of the affiliated group.
(W) Corporations filing a consolidated the City income tax return shall make the computations required
under divisions (R) through (Y) of Section 1501.05 by substituting "consolidated federal taxable income
attributable to" for "net profit from" wherever "net profit from" appears in that section and by substituting
"affiliated group of corporations" for "taxpayer" wherever "taxpayer" appears in that section.
(X) Each corporation filing a consolidated the City income tax return is jointly and severally liable for any
tax, interest, penalties, fines, charges, or other amounts imposed by the City in accordance with this Chapter
on the corporation, an affiliated group of which the corporation is a member for any portion of the taxable
year, or any one or more members of such an affiliated group.
(Y) Corporations and their affiliates that made an election or entered into an agreement with the City before
January 1, 2016, to file a consolidated or combined tax return with the City may continue to file consolidated
or combined tax returns in accordance with such election or agreement for taxable years beginning on and
after January 1, 2016.
34
1501.06 CREDIT FOR TAX PAID TO OTHER MUNICIPALITIES.
(A) Every individual taxpayer domiciled in the City who is required to and does pay, or has acknowledged
liability for, a municipal tax to another municipality on or measured by the same income, qualifying wages,
commissions, net profits or other compensation taxable under this Chapter may claim a nonrefundable
credit upon satisfactory evidence of the tax paid to the other municipality. Subject to division (C) of this
section, the credit shall not exceed the tax due the City under this Chapter.
(B) The City shall grant a credit against its tax on income to a resident of the City who works in a joint
economic development zone created under Section 715.691 or a joint economic development district
created under Section 715.70, 715.71, or 715.72 of the ORC to the same extent that it grants a credit against
its tax on income to its residents who are employed in another municipal corporation.
(C) If the amount of tax withheld or paid to the other municipality is less than the amount of tax required
to be withheld or paid to the other municipality, then for purposes of division (A) of this section, “the
income, qualifying wages, commissions, net profits or other compensation” subject to tax in the other
municipality shall be limited to the amount computed by dividing the tax withheld or paid to the other
municipality by the tax rate for that municipality.
(D) Intentionally left blank.
1501.07 ESTIMATED TAXES.
(A) As used in this section:
(1) "Estimated taxes" means the amount that the taxpayer reasonably estimates to be the taxpayer's tax
liability for the City’s income tax for the current taxable year.
(2) "Tax liability" means the total taxes due to the City for the taxable year, after allowing any credit to
which the taxpayer is entitled, and after applying any estimated tax payment, withholding payment, or credit
from another taxable year.
(B)(1) Every taxpayer shall make a declaration of estimated taxes for the current taxable year, on the form
prescribed by the Tax Administrator, if the amount payable as estimated taxes is at least $200. For the
purposes of this section:
(a) Taxes withheld for the City from qualifying wages shall be considered as paid to the City in
equal amounts on each payment date unless the taxpayer establishes the dates on which all amounts were
actually withheld, in which case they shall be considered as paid on the dates on which the amounts were
actually withheld.
(b) An overpayment of tax applied as a credit to a subsequent taxable year is deemed to be paid on
the date of the postmark stamped on the cover in which the payment is mailed or, if the payment is made
by electronic funds transfer, the date the payment is submitted. As used in this division, "date of the
postmark" means, in the event there is more than one date on the cover, the earliest date imprinted on the
cover by the postal service.
35
(2) Taxpayers filing joint returns shall file joint declarations of estimated taxes. A taxpayer may amend
a declaration under rules prescribed by the Tax Administrator. A taxpayer having a taxable year of less than
twelve months shall make a declaration under rules prescribed by the Tax Administrator.
(3) The declaration of estimated taxes shall be filed on or before the date prescribed for the filing of
municipal income tax returns under division (G) of Section 1501.05 or on or before the fifteenth (15th) day
of the fourth month after the taxpayer becomes subject to tax for the first time.
(4) Taxpayers reporting on a fiscal year basis shall file a declaration on or before the fifteenth (15th) day
of the fourth month after the beginning of each fiscal year or period.
(5) The original declaration or any subsequent amendment may be increased or decreased on or before
any subsequent quarterly payment day as provided in this section.
(C)(1) The required portion of the tax liability for the taxable year that shall be paid through estimated taxes
made payable to the City, including the application of tax refunds to estimated taxes and withholding on or
before the applicable payment date, shall be as follows:
(a) On or before the fifteenth (15th) day of the fourth month after the beginning of the taxable year,
twenty-two and one-half (22.5) percent of the tax liability for the taxable year;
(b) On or before the fifteenth (15th) day of the sixth month after the beginning of the taxable year,
forty-five (45) percent of the tax liability for the taxable year;
(c) On or before the fifteenth (15th) day of the ninth month after the beginning of the taxable year,
sixty-seven and one-half (67.5) percent of the tax liability for the taxable year;
(d) For an individual, on or before the fifteenth (15th) day of the first month of the following taxable
year, ninety percent (90%) of the tax liability for the taxable year. For a person other than an individual, on or
before the fifteenth (15th) day of the twelfth month of the taxable year, ninety percent (90%) of the tax
liability for the taxable year.
(2) When an amended declaration has been filed, the unpaid balance shown due on the amended
declaration shall be paid in equal installments on or before the remaining payment dates.
(3) On or before the fifteenth (15th) day of the fourth month of the year following that for which the
declaration or amended declaration was filed, an annual return shall be filed and any balance which may be
due shall be paid with the return in accordance with Section 718.05 of the Revised Code.
(D)(1) In the case of any underpayment of any portion of a tax liability, penalty and interest may be imposed
pursuant to Section 1501.18 upon the amount of underpayment for the period of underpayment, unless the
underpayment is due to reasonable cause as described in division (E) of this section. The amount of the
underpayment shall be determined as follows:
(a) For the first payment of estimated taxes each year, twenty-two and one-half percent (22.5%) of
the tax liability, less the amount of taxes paid by the date prescribed for that payment;
(b) For the second payment of estimated taxes each year, forty-five percent (45%) of the tax
liability, less the amount of taxes paid by the date prescribed for that payment;
36
(c) For the third payment of estimated taxes each year, sixty-seven and one-half percent (67.5%)
of the tax liability, less the amount of taxes paid by the date prescribed for that payment;
(d) For the fourth payment of estimated taxes each year, ninety percent (90%) of the tax liability,
less the amount of taxes paid by the date prescribed for that payment.
(2) The period of the underpayment shall run from the day the estimated payment was required to be
made to the date on which the payment is made. For purposes of this section, a payment of estimated taxes
on or before any payment date shall be considered a payment of any previous underpayment only to the
extent the payment of estimated taxes exceeds the amount of the payment presently required to be paid to
avoid any penalty.
(E) An underpayment of any portion of tax liability determined under division (D) of this section shall be
due to reasonable cause and the penalty imposed by this section shall not be added to the taxes for the
taxable year if any of the following apply:
(1) The amount of estimated taxes that were paid equals at least ninety percent (90%) of the tax liability
for the current taxable year, determined by annualizing the income received during the year up to the end
of the month immediately preceding the month in which the payment is due.
(2) The amount of estimated taxes that were paid equals at least one hundred percent of the tax liability
shown on the return of the taxpayer for the preceding taxable year, provided that the immediately preceding
taxable year reflected a period of twelve months and the taxpayer filed a return with the City under Section
1501.05 for that year.
(3) The taxpayer is an individual who resides in the City but was not domiciled there on the first day of
January of the calendar year that includes the first day of the taxable year.
1501.08 ROUNDING OF AMOUNTS.
A person may round to the nearest whole dollar all amounts the person is required to enter on any return,
report, voucher, or other document required under this Chapter. Any fractional part of a dollar that equals
or exceeds fifty cents shall be rounded to the next whole dollar, and any fractional part of a dollar that is
less than fifty cents shall be dropped. If a person chooses to round amounts entered on a document, the
person shall round all amounts entered on the document.
1501.09 REQUESTS FOR REFUNDS.
(A) As used in this section, "withholding tax" has the same meaning as in Section 1501.18.
(B) Upon receipt of a request for a refund, the Tax Administrator, in accordance with this section, shall
refund to employers, agents of employers, other payers, or taxpayers, with respect to any income or
withholding tax levied by the City:
(1) Overpayments of more than ten dollars or more;
(2) Amounts paid erroneously if the refund requested exceeds ten dollars or more.
37
(C)(1) Except as otherwise provided in this Chapter, requests for refund shall be filed with the Tax
Administrator, on the form prescribed by the Tax Administrator within three years after the tax was due or
paid, whichever is later. The Tax Administrator may require the requestor to file with the request any
documentation that substantiates the requestor's claim for a refund.
(2) On filing of the refund request, the Tax Administrator shall determine the amount of refund due and
certify such amount to the appropriate municipal corporation official for payment. Except as provided in
division (C)(3) of this section, the administrator shall issue an assessment to any taxpayer whose request
for refund is fully or partially denied. The assessment shall state the amount of the refund that was denied,
the reasons for the denial, and instructions for appealing the assessment.
(3) If a Tax Administrator denies in whole or in part a refund request included within the taxpayer's
originally filed annual income tax return, the Tax Administrator shall notify the taxpayer, in writing, of the
amount of the refund that was denied, the reasons for the denial, and instructions for requesting an
assessment that may be appealed under Section 1501.21.
(D) A request for a refund that is received after the last day for filing specified in division (C) of this section
shall be considered to have been filed in a timely manner if any of the following situations exist:
(1) The request is delivered by the postal service, and the earliest postal service postmark on the cover
in which the request is enclosed is not later than the last day for filing the request.
(2) The request is delivered by the postal service, the only postmark on the cover in which the request is
enclosed was affixed by a private postal meter, the date of that postmark is not later than the last day for
filing the request, and the request is received within seven days of such last day.
(3) The request is delivered by the postal service, no postmark date was affixed to the cover in which
the request is enclosed or the date of the postmark so affixed is not legible, and the request is received
within seven days of the last day for making the request.
(E) Interest shall be allowed and paid on any overpayment by a taxpayer of any municipal income tax
obligation from the date of the overpayment until the date of the refund of the overpayment, except that if
any overpayment is refunded within 90 days after the final filing date of the annual return or 90 days after
the completed return is filed, whichever is later, no interest shall be allowed on the refund. For the purpose
of computing the payment of interest on amounts overpaid, no amount of tax for any taxable year shall be
considered to have been paid before the date on which the return on which the tax is reported is due, without
regard to any extension of time for filing that return. Interest shall be paid at the interest rate described in
Section 1501.18 (A)(4).
1501.10 SECOND MUNICIPALITY IMPOSING TAX AFTER TIME PERIOD ALLOWED FOR
REFUND.
(A) Income tax that has been deposited with the City, but should have been deposited with another
municipality, is allowable by the City as a refund but is subject to the three-year limitation on refunds.
(B) Income tax that was deposited with another municipality but should have been deposited with the City
is subject to recovery by the City. If the City’s tax on that income is imposed after the time period allowed
for a refund of the tax or withholding paid to the other municipality, the City shall allow a nonrefundable
credit against the tax or withholding the City claims is due with respect to such income or wages, equal to
the tax or withholding paid to the first municipality with respect to such income or wages.
38
(C) If the City’s tax rate is less than the tax rate in the other municipality, then the nonrefundable credit
shall be calculated using the City’s tax rate. However, if the City’s tax rate is greater than the tax rate in
the other municipality, the tax due in excess of the nonrefundable credit is to be paid to the City, along with
any penalty and interest that accrued during the period of nonpayment.
(D) Nothing in this section permits any credit carryforward.
1501.11 AMENDED RETURNS.
(A)(1) If a taxpayer’s tax liability shown on the annual tax return for the City changes as a result of an
adjustment to the taxpayer’s federal or state income tax return, the taxpayer shall file an amended return
with the City. The amended return shall be filed on a form required by the Tax Administrator.
(2) If a taxpayer intends to file an amended consolidated municipal income tax return, or to amend its
type of return from a separate return to a consolidated return, based on the taxpayer's consolidated federal
income tax return, the taxpayer shall notify the Tax Administrator before filing the amended return.
(B)(1) In the case of an underpayment, the amended return shall be accompanied by payment of any
combined additional tax due, together with any penalty and interest thereon. If the combined tax shown to
be due is ten dollars or less, no payment need be made. The amended return shall reopen those facts, figures,
computations, or attachments from a previously filed return that are not affected, either directly or
indirectly, by the adjustment to the taxpayer's federal or state income tax return only:
(i) to determine the amount of tax that would be due if all facts, figures, computations, and
attachments were reopened; or,
(ii) if the applicable statute of limitations for civil actions or prosecutions under Section 1501.12
has not expired for a previously filed return.
(2) The additional tax to be paid shall not exceed the amount of tax that would be due if all facts, figures,
computations, and attachments were reopened; i.e., the payment shall be the lesser of the two amounts.
(C)(1) In the case of an overpayment, a request for refund may be filed under this division within the period
prescribed by division (E) of Section 1501.12 for filing the amended return, even if it is filed beyond the
period prescribed in that division if it otherwise conforms to the requirements of that division. If the amount
of the refund is in accordance with the dollars, no refund need be paid by the City. A request filed under
this division shall claim refund of overpayments resulting from alterations only to those facts, figures,
computations, or attachments required in the taxpayer's annual return that are affected, either directly or
indirectly, by the adjustment to the taxpayer's federal or state income tax return, unless it is also filed within
the time prescribed in Section 1501.09.
(2) The amount to be refunded shall not exceed the amount of refund that would be due if all facts,
figures, computations, and attachments were reopened. All facts, figures, computations, and attachments
may be reopened to determine the refund amount due by inclusion of all facts, figures, computations, and
attachments.
(D) Within 60 days after the final determination of any federal or state tax liability affecting the taxpayer's
the City’s tax liability, that taxpayer shall make and file an amended the City return showing income subject
to the City income tax based upon such final determination of federal or state tax liability. The taxpayer
39
shall pay any additional the City income tax shown due thereon or make a claim for refund of any
overpayment, unless the tax or overpayment is less than ten dollars.
1501.12 LIMITATIONS.
(A)(1)(a) Civil actions to recover municipal income taxes and penalties and interest on municipal income
taxes shall be brought within the later of:
(i) Three years after the tax was due or the return was filed, whichever is later; or
(ii) One year after the conclusion of the qualifying deferral period, if any.
(b) The time limit described in division (A)(1)(a) of this section may be extended at any time if both
the Tax Administrator and the employer, agent of the employer, other payer, or taxpayer consent in writing
to the extension. Any extension shall also extend for the same period of time the time limit described in
division (C) of this section.
(2) As used in this section, "qualifying deferral period" means a period of time beginning and ending as
follows:
(a) Beginning on the date a person who is aggrieved by an assessment files with the Board of Tax
Review the request described in Section 1501.21. That date shall not be affected by any subsequent
decision, finding, or holding by any administrative body or court that the Board of Tax Review did not have
jurisdiction to affirm, reverse, or modify the assessment or any part of that assessment.
(b) Ending the later of the sixtieth day after the date on which the final determination of the Board
of Tax Review becomes final or, if any party appeals from the determination of the Board of Tax Review,
the sixtieth day after the date on which the final determination of the Board of Tax Review is either
ultimately affirmed in whole or in part or ultimately reversed and no further appeal of either that affirmation,
in whole or in part, or that reversal is available or taken.
(B) Prosecutions for an offense made punishable under a resolution or ordinance imposing an income tax
shall be commenced within three years after the commission of the offense, provided that in the case of
fraud, failure to file a return, or the omission of twenty-five percent (25%) or more of income required to
be reported, prosecutions may be commenced within six years after the commission of the offense.
(C) A claim for a refund of municipal income taxes shall be brought within the time limitation provided in
Section 1501.09.
(D)(1) Notwithstanding the fact that an appeal is pending, the petitioner may pay all or a portion of the
assessment that is the subject of the appeal. The acceptance of a payment by the City does not prejudice
any claim for refund upon final determination of the appeal.
(2) If upon final determination of the appeal an error in the assessment is corrected by the Tax
Administrator, upon an appeal so filed or pursuant to a final determination of the Board of Tax Review, of
the Ohio board of tax appeals, or any court to which the decision of the Ohio board of tax appeals has been
appealed, so that the resultant amount due is less than the amount paid, a refund will be paid in the amount
of the overpayment as provided by Section 1501.09, with interest on that amount as provided by division
(E) of Section 1501.09.
40
(E) No civil action to recover the City income tax or related penalties or interest shall be brought during
either of the following time periods:
(1) The period during which a taxpayer has a right to appeal the imposition of that tax or interest or those
penalties;
(2) The period during which an appeal related to the imposition of that tax or interest or those penalties
is pending.
1501.13 AUDITS.
(A) At or before the commencement of an audit, the Tax Administrator shall provide to the taxpayer a
written description of the roles of the Tax Administrator and of the taxpayer during the audit and a statement
of the taxpayer's rights, including any right to obtain a refund of an overpayment of a tax. At or before the
commencement of an audit, the Tax Administrator shall inform the taxpayer when the audit is considered
to have commenced.
(B) Except in cases involving suspected criminal activity, the Tax Administrator shall conduct an audit of
a taxpayer during regular business hours and after providing reasonable notice to the taxpayer. A taxpayer
who is unable to comply with a proposed time for an audit on the grounds that the proposed time would
cause inconvenience or hardship must offer reasonable alternative dates for the audit.
(C) At all stages of an audit by the Tax Administrator, a taxpayer is entitled to be assisted or represented
by an attorney, accountant, bookkeeper, or other tax practitioner. The Tax Administrator shall prescribe a
form by which a taxpayer may designate such a person to assist or represent the taxpayer in the conduct of
any proceedings resulting from actions by the Tax Administrator. If a taxpayer has not submitted such a
form, the Tax Administrator may accept other evidence, as the Tax Administrator considers appropriate,
that a person is the authorized representative of a taxpayer.
A taxpayer may refuse to answer any questions asked by the person conducting an audit until the taxpayer
has an opportunity to consult with the taxpayer's attorney, accountant, bookkeeper, or other tax practitioner.
This division does not authorize the practice of law by a person who is not an attorney.
(D) A taxpayer may record, electronically or otherwise, the audit examination.
(E) The failure of the Tax Administrator to comply with a provision of this section shall neither excuse a
taxpayer from payment of any taxes owed by the taxpayer nor cure any procedural defect in a taxpayer's
case.
(F) If the Tax Administrator fails to substantially comply with the provisions of this section, the Tax
Administrator, upon application by the taxpayer, shall excuse the taxpayer from penalties and interest
1501.14 SERVICE OF ASSESSMENT.
(A) As used in this section:
(1) "Last known address" means the address the Tax Administrator has at the time a document is
originally sent by certified mail, or any address the Tax Administrator can ascertain using reasonable means
41
such as the use of a change of address service offered by the postal service or an authorized delivery service
under Section 5703.056 of the ORC.
(2) "Undeliverable address" means an address to which the postal service or an authorized delivery
service under Section 5703.056 of the ORC is not able to deliver an assessment of the Tax Administrator,
except when the reason for non-delivery is because the addressee fails to acknowledge or accept the
assessment.
(B) Subject to division (C) of this section, a copy of each assessment shall be served upon the person
affected thereby either by personal service, by certified mail, or by a delivery service authorized under
Section 5703.056 of the ORC. With the permission of the person affected by an assessment, the Tax
Administrator may deliver the assessment through alternative means as provided in this section, including,
but not limited to, delivery by secure electronic mail.
(C)(1)(a) If certified mail is returned because of an undeliverable address, a Tax Administrator shall utilize
reasonable means to ascertain a new last known address, including the use of a change of address service
offered by the postal service or an authorized delivery service under Section 5703.056 of the ORC. If the
Tax Administrator is unable to ascertain a new last known address, the assessment shall be sent by ordinary
mail and considered served. If the ordinary mail is subsequently returned because of an undeliverable
address, the assessment remains appealable within 60 days after the assessment's postmark.
(b) Once the Tax Administrator or other the City official, or the designee of either, serves an
assessment on the person to whom the assessment is directed, the person may protest the ruling of that
assessment by filing an appeal with the local board of tax review within 60 days after the receipt of service.
The delivery of an assessment of the Tax Administrator under division (C)(1)(a) of this section is prima
facie evidence that delivery is complete and that the assessment is served.
(2) If mailing of an assessment by a Tax Administrator by certified mail is returned for some cause other
than an undeliverable address, the Tax Administrator shall resend the assessment by ordinary mail. The
assessment shall show the date the Tax Administrator sends the assessment and include the following
statement:
"This assessment is deemed to be served on the addressee under applicable law ten days from the date this
assessment was mailed by the Tax Administrator as shown on the assessment, and all periods within which
an appeal may be filed apply from and after that date."
Unless the mailing is returned because of an undeliverable address, the mailing of that information is prima
facie evidence that delivery of the assessment was completed ten days after the Tax Administrator sent the
assessment by ordinary mail and that the assessment was served.
If the ordinary mail is subsequently returned because of an undeliverable address, the Tax Administrator
shall proceed under division (C)(1)(a) of this section. A person may challenge the presumption of delivery
and service under this division in accordance with division (D) of this section.
(D)(1) A person disputing the presumption of delivery and service under division (C) of this section bears
the burden of proving by a preponderance of the evidence that the address to which the assessment was sent
by certified mail was not an address with which the person was associated at the time the Tax Administrator
originally mailed the assessment. For the purposes of this section, a person is associated with an address at
the time the Tax Administrator originally mailed the assessment if, at that time, the person was residing,
receiving legal documents, or conducting business at the address; or if, before that time, the person had
42
conducted business at the address and, when the assessment was mailed, the person's agent or the person's
affiliate was conducting business at the address. For the purposes of this section, a person's affiliate is any
other person that, at the time the assessment was mailed, owned or controlled at least 20 percent, as
determined by voting rights, of the addressee's business.
(2) If a person elects to appeal an assessment on the basis described in division (D)(1) of this section,
and if that assessment is subject to collection and is not otherwise appealable, the person must do so within
60 days after the initial contact by the Tax Administrator or other the City official, or the designee of either,
with the person. Nothing in this division prevents the Tax Administrator or other official from entering into
a compromise with the person if the person does not actually file such an appeal with the local board of tax
review.
(E) Nothing in this section prohibits the Tax Administrator or the Tax Administrator's designee from
delivering an assessment by a Tax Administrator by personal service.
(F) Collection actions taken upon any assessment being appealed under division (C)(1)(b) of this section,
including those on which a claim has been delivered for collection, shall be stayed upon the pendency of
an appeal under this section.
(G) Additional regulations as detailed in the Rules and Regulations shall apply.
1501.15 ADMINISTRATION OF CLAIMS.
(A) As used in this section, "claim" means a claim for an amount payable to the City that arises pursuant to
the City’s income tax imposed in accordance with this Chapter.
(B) Nothing in this Chapter prohibits a Tax Administrator from doing either of the following if such action
is in the best interests of the City:
(1) Compromise a claim;
(2) Extend for a reasonable period the time for payment of a claim by agreeing to accept monthly or
other periodic payments.
(C) The Tax Administrator's rejection of a compromise or payment-over-time agreement proposed by a
person with respect to a claim shall not be appealable.
(D) A compromise or payment-over-time agreement with respect to a claim shall be binding upon and shall
be to the benefit of only the parties to the compromise or agreement, and shall not eliminate or otherwise
affect the liability of any other person.
(E) A compromise or payment-over-time agreement with respect to a claim shall be void if the taxpayer
defaults under the compromise or agreement or if the compromise or agreement was obtained by fraud or
by misrepresentation of a material fact. Any amount that was due before the compromise or agreement and
that is unpaid shall remain due, and any penalties or interest that would have accrued in the absence of the
compromise or agreement shall continue to accrue and be due.
1501.16 TAX INFORMATION CONFIDENTIAL.
43
(A) Any information gained as a result of returns, investigations, hearings, or verifications required or
authorized by this Chapter is confidential, and no person shall access or disclose such information except
in accordance with a proper judicial order or in connection with the performance of that person's official
duties or the official business of the City as authorized by this Chapter. The Tax Administrator or a designee
thereof may furnish copies of returns filed or otherwise received under this Chapter and other related tax
information to the internal revenue service, the tax commissioner, and tax administrators of other municipal
corporations.
(B) This section does not prohibit the City from publishing or disclosing statistics in a form that does not
disclose information with respect to particular taxpayers.
1501.17 FRAUD.
No person shall knowingly make, present, aid, or assist in the preparation or presentation of a false or
fraudulent report, return, schedule, statement, claim, or document authorized or required by the City
ordinance or state law to be filed with a the Tax Administrator, or knowingly procure, counsel, or advise
the preparation or presentation of such report, return, schedule, statement, claim, or document, or knowingly
change, alter, or amend, or knowingly procure, counsel or advise such change, alteration, or amendment of
the records upon which such report, return, schedule, statement, claim, or document is based with intent to
defraud the City or the Tax Administrator.
1501.18 INTEREST AND PENALTIES.
(A) As used in this section:
(1) "Applicable law" means this Chapter, the resolutions, ordinances, codes, directives, instructions, and
rules adopted by the City provided they impose or directly or indirectly address the levy, payment,
remittance, or filing requirements of the City.
(2) "Federal short-term rate" means the rate of the average market yield on outstanding marketable
obligations of the United States with remaining periods to maturity of three years or less, as determined
under Section 1274 of the Internal Revenue Code, for July of the current year.
(3) "Income tax," "estimated income tax," and "withholding tax" means any income tax, estimated
income tax, and withholding tax imposed by the City pursuant to applicable law, including at any time
before January 1, 2016.
(4) "Interest rate as described in division (A) of this section" means the federal short-term rate, rounded
to the nearest whole number percent, plus five percent. The rate shall apply for the calendar year next
following the July of the year in which the federal short-term rate is determined in accordance with division
(A)(2) of this section.
(5) "Return" includes any tax return, report, reconciliation, schedule, and other document required to be
filed with the Tax Administrator or the City by a taxpayer, employer, any agent of the employer, or any
other payer pursuant to applicable law, including at any time before January 1, 2016.
(6) "Unpaid estimated income tax" means estimated income tax due but not paid by the date the tax is
required to be paid under applicable law.
44
(7) "Unpaid income tax" means income tax due but not paid by the date the income tax is required to be
paid under applicable law.
(8) "Unpaid withholding tax" means withholding tax due but not paid by the date the withholding tax is
required to be paid under applicable law.
(9) "Withholding tax" includes amounts an employer, any agent of an employer, or any other payer did
not withhold in whole or in part from an employee's qualifying wages, but that, under applicable law, the
employer, agent, or other payer is required to withhold from an employee's qualifying wages.
(B)(1) This section applies to the following:
(a) Any return required to be filed under applicable law for taxable years beginning on or after
January 1, 2016;
(b) Income tax, estimated income tax, and withholding tax required to be paid or remitted to the
City on or after January 1, 2016.
(2) This section does not apply to returns required to be filed or payments required to be made before
January 1, 2016, regardless of the filing or payment date. Returns required to be filed or payments required
to be made before January 1, 2016, but filed or paid after that date shall be subject to the ordinances or rules
and regulations, as adopted before January 1, 2016, of the City to which the return is to be filed or the
payment is to be made.
(C) Should any taxpayer, employer, agent of the employer, or other payer for any reason fails, in whole or
in part, to make timely and full payment or remittance of income tax, estimated income tax, or withholding
tax or to file timely with the City any return required to be filed, the following penalties and interest shall
apply:
(1) Interest shall be imposed at the rate described in division (A) of this section, per annum, on all unpaid
income tax, unpaid estimated income tax, and unpaid withholding tax.
(2)(a) With respect to unpaid income tax and unpaid estimated income tax, the City may impose a
penalty equal to fifteen percent (15%) of the amount not timely paid.
(b) With respect to any unpaid withholding tax, the City may impose a penalty not exceeding fifty
percent (50%) of the amount not timely paid.
(3)(a) For tax years ending on or before December 31, 2022, with respect to returns other than estimated
income tax returns, the City may impose a penalty of $25 for each failure to timely file each return,
regardless of the liability shown thereon for each month, or any fraction thereof, during which the return
remains unfiled regardless of the liability shown thereon. The penalty shall not exceed $150 for each failure.
(b) For tax years ending on or after January 1, 2023, with respect to returns other than estimated income
tax returns, the City may impose a penalty not exceeding $25 for each failure to timely file each return,
regardless of the liability shown thereon, except that the City shall abate or refund the penalty assessed on
a taxpayer’s first failure to timely file a return after the taxpayer files that return.
45
(D) Nothing in this section requires the City to refund or credit any penalty, amount of interest, charges, or
additional fees that the City has properly imposed or collected before January 1, 2016.
(E) Nothing in this section limits the authority of the City to abate or partially abate penalties or interest
imposed under this section when the Tax Administrator determines, in the Tax Administrator's sole
discretion, that such abatement is appropriate.
(F) By the 31st day of October of each year the City shall publish the rate described in division (A) of this
section applicable to the next succeeding calendar year.
(G) the City may impose on the taxpayer, employer, any agent of the employer, or any other payer the City's
post-judgment collection costs and fees, including attorney's fees.
1501.19 AUTHORITY OF TAX ADMINISTRATOR; VERIFICATION OF INFORMATION.
Authority.
(A) Nothing in this Chapter shall limit the authority of the Tax Administrator to perform any of the
following duties or functions, unless the performance of such duties or functions is expressly limited by a
provision of the ORC:
(1)(a) Exercise all powers whatsoever of an query nature as provided by law, including, the right to
inspect books, accounts, records, memorandums, and federal and state income tax returns, to examine
persons under oath, to issue orders or subpoenas for the production of books, accounts, papers, records,
documents, and testimony, to take depositions, to apply to a court for attachment proceedings as for
contempt, to approve vouchers for the fees of officers and witnesses, and to administer oaths.
(b) The powers referred to in this division of this section shall be exercised by the Tax Administrator
only in connection with the performance of the duties respectively assigned to the Tax Administrator under
the City’s income tax ordinance;
(2) Appoint agents and prescribe their powers and duties;
(3) Confer and meet with officers of other municipal corporations and states and officers of the United
States on any matters pertaining to their respective official duties as provided by law;
(4) Exercise the authority provided by law, including orders from bankruptcy courts, relative to
remitting or refunding taxes, including penalties and interest thereon, for any reason overpaid. In addition,
the Tax Administrator may investigate any claim of overpayment and, if the Tax Administrator finds that
there has been an overpayment, make a written statement of the Tax Administrator's findings, and approve
and issue a refund payable to the taxpayer, the taxpayer's assigns, or legal representative as provided in this
Chapter;
(5) Exercise the authority provided by law relative to consenting to the compromise and settlement of
tax claims;
(6) Exercise the authority provided by law relative to the use of alternative apportionment methods by
taxpayers in accordance with Section 1501.03;
46
(7)(a) Make all tax findings, determinations, computations, and orders the Tax Administrator is by law
authorized and required to make and, pursuant to time limitations provided by law, on the Tax
Administrator's own motion, review, re-determine, or correct any tax findings, determinations,
computations, or orders the Tax Administrator has made.
(b) If an appeal has been filed with the Board of Tax Review or other appropriate tribunal, the Tax
Administrator shall not review, re-determine, or correct any tax finding, determination, computation, or
order which the Tax Administrator has made, unless such appeal or application is withdrawn by the
appellant or applicant, is dismissed, or is otherwise final;
(8) Destroy any or all returns or other tax documents in the manner authorized by law;
(9) Enter into an agreement with a taxpayer to simplify the withholding obligations described in Section
1501.04.
Verification of accuracy of returns and determination of liability.
(B)(1) A Tax Administrator, or any authorized agent or employee thereof may examine the books, papers,
records, and federal and state income tax returns of any employer, taxpayer, or other person that is subject
to, or that the Tax Administrator believes is subject to, the provisions of this Chapter for the purpose of
verifying the accuracy of any return made or, if no return was filed, to ascertain the tax due under this
Chapter. Upon written request by the Tax Administrator or a duly authorized agent or employee thereof,
every employer, taxpayer, or other person subject to this section is required to furnish the opportunity for
the Tax Administrator, authorized agent, or employee to investigate and examine such books, papers,
records, and federal and state income tax returns at a reasonable time and place designated in the request.
(2) The records and other documents of any taxpayer, employer, or other person that is subject to, or
that a Tax Administrator believes is subject to, the provisions of this Chapter shall be open to the Tax
Administrator's inspection during business hours and shall be preserved for a period of six years following
the end of the taxable year to which the records or documents relate, unless the Tax Administrator, in
writing, consents to their destruction within that period, or by order requires that they be kept longer. The
Tax Administrator may require any person, by notice served on that person, to keep such records as the Tax
Administrator determines necessary to show whether or not that person is liable, and the extent of such
liability, for the income tax levied by the City or for the withholding of such tax.
(3) The Tax Administrator may examine under oath any person that the Tax Administrator reasonably
believes has knowledge concerning any income that was or would have been returned for taxation or any
transaction tending to affect such income. The Tax Administrator may, for this purpose, compel any such
person to attend a hearing or examination and to produce any books, papers, records, and federal and state
income tax returns in such person's possession or control. The person may be assisted or represented by an
attorney, accountant, bookkeeper, or other tax practitioner at any such hearing or examination. This division
does not authorize the practice of law by a person who is not an attorney.
(4) No person issued written notice by the Tax Administrator compelling attendance at a hearing or
examination or the production of books, papers, records, or federal or state income tax returns under this
section shall fail to comply.
Identification information.
47
(C)(1) Nothing in this Chapter prohibits the Tax Administrator from requiring any person filing a tax
document with the Tax Administrator to provide identifying information, which may include the person's
social security number, federal employer identification number, or other identification number requested
by the Tax Administrator. A person required by the Tax Administrator to provide identifying information
that has experienced any change with respect to that information shall notify the Tax Administrator of the
change before, or upon, filing the next tax document requiring the identifying information.
(2)(a) If the Tax Administrator makes a request for identifying information and the Tax Administrator
does not receive valid identifying information within 30 days of making the request, nothing in this Chapter
prohibits the Tax Administrator from imposing a penalty upon the person to whom the request was directed
pursuant to Section 1501.18, in addition to any applicable penalty described in Section 1501.99.
(b) If a person required by the Tax Administrator to provide identifying information does not notify
the Tax Administrator of a change with respect to that information as required under division (C) of Section
1501.19 within 30 days after filing the next tax document requiring such identifying information, nothing
in this Chapter prohibits the Tax Administrator from imposing a penalty pursuant to Section 1501.18.
(c) The penalties provided for under divisions (C)(2)(a) and (b) of this section may be billed and
imposed in the same manner as the tax or fee with respect to which the identifying information is sought
and are in addition to any applicable criminal penalties described in Section 1501.99 for a violation of
Section 1501.17 and any other penalties that may be imposed by the Tax Administrator by law.
1501.20 REQUEST FOR OPINION OF THE TAX ADMINISTRATOR.
(A) An "opinion of the Tax Administrator" means an opinion issued under this section with respect to
prospective municipal income tax liability. It does not include ordinary correspondence of the Tax
Administrator.
(B) A taxpayer may submit a written request for an opinion of the Tax Administrator in accordance with
the Rules and Regulations.
(C) A taxpayer is not relieved of tax liability for any activity or transaction related to a request for an opinion
that contained any misrepresentation or omission of one or more material facts.
(D) A Tax Administrator may refuse to offer an opinion on any request received under this section. Such
refusal is not subject to appeal.
(E) An opinion of the Tax Administrator binds the Tax Administrator only with respect to the taxpayer for
whom the opinion was prepared and does not bind the Tax Administrator of any other municipal
corporation.
(F) An opinion of the Tax Administrator issued under this section is not subject to appeal.
1501.21 BOARD OF TAX REVIEW.
(A)(1) The Board of Tax Review shall consist of three members. Two members shall be appointed by the
legislative authority of the City, but such appointees may not be employees, elected officials, or contractors
with the City at any time during their term or in the five years (which applies only to these two
appointments) immediately preceding the date of appointment. One member shall be appointed by the
48
Mayor of the City. This member may be an employee of the City, but may not be the director of finance or
equivalent officer, or the Tax Administrator or other similar official or an employee directly involved in
municipal tax matters, or any direct subordinate thereof.
(2) The term for members of the Board of Tax Review the City shall be two years. There is no limit on
the number of terms that a member may serve if the member is reappointed by the legislative authority. The
board member appointed by the Mayor of the City shall serve at the discretion of the administrative official.
(3) Members of the Board of Tax Review appointed by the legislative authority may be removed by the
legislative authority by majority vote for malfeasance, misfeasance, or nonfeasance in office. To remove
such a member, the legislative authority must give the member a copy of the charges against the member
and afford the member an opportunity to be publicly heard in person or by counsel in the member's own
defense upon not less than ten days' notice. The decision by the legislative authority on the charges is final
and not appealable.
(4) A member of the Board of Tax Review who, for any reason, ceases to meet the qualifications for
the position prescribed by this section shall resign immediately by operation of law.
(5) A vacancy in an unexpired term shall be filled in the same manner as the original appointment within
60 days of when the vacancy was created. Any member appointed to fill a vacancy occurring prior to the
expiration of the term for which the member's predecessor was appointed shall hold office for the remainder
of such term. No vacancy on the Board of Tax Review shall impair the power and authority of the remaining
members to exercise all the powers of the Board of Tax Review.
(6) If a member is temporarily unable to serve on the Board of Tax Review due to a conflict of interest,
illness, absence, or similar reason, the legislative authority or top administrative official that appointed the
member shall appoint another individual to temporarily serve on the Board of Tax Review in the member's
place. The appointment of such an individual shall be subject to the same requirements and limitations as
are applicable to the appointment of the member temporarily unable to serve.
(B) Whenever a Tax Administrator issues an assessment, the Tax Administrator shall notify the taxpayer
in writing at the same time of the taxpayer's right to appeal the assessment, the manner in which the taxpayer
may appeal the assessment, and the address to which the appeal should be directed.
(C) Any person who has been issued an assessment may appeal the assessment to the Board of Tax Review
by filing a request with the Board of Tax Review. The request shall be in writing, shall specify the reason
or reasons why the assessment should be deemed incorrect or unlawful, and shall be filed within 60 days
after the taxpayer receives the assessment.
(D) The Board of Tax Review shall schedule a hearing to be held within 60 days after receiving an appeal
of an assessment under division (C) of this section, unless the taxpayer requests additional time to prepare
or waives a hearing. If the taxpayer does not waive the hearing, the taxpayer may appear before the Board
of Tax Review and may be represented by an attorney at law, certified public accountant, or other
representative. The Board of Tax Review may allow a hearing to be continued as jointly agreed to by the
parties. In such a case, the hearing must be completed within 120 days after the first day of the hearing
unless the parties agree otherwise.
(E) The Board of Tax Review may affirm, reverse, or modify the Tax Administrator's assessment or any
part of that assessment. The Board of Tax Review shall issue a final determination on the appeal within 90
days after the Board of Tax Review's final hearing on the appeal, and send a copy of its final determination
49
by ordinary mail to all of the parties to the appeal within 15 days after issuing the final determination. The
taxpayer or the Tax Administrator may appeal the Board of Tax Review's final determination as provided
in Section 5717.011 of the ORC.
(F) The Board of Tax Review created pursuant to this section shall adopt rules governing its procedures
and shall keep a record of its transactions. Such records are not public records available for inspection under
Section 149.43 of the ORC. Hearings requested by a taxpayer before a Board of Tax Review created
pursuant to this section are not meetings of a public body subject to Section 121.22 of the ORC.
1501.22 AUTHORITY TO CREATE RULES AND REGULATIONS.
Nothing in this Chapter prohibits the legislative authority of the City, or a Tax Administrator pursuant to
authority granted to the administrator by resolution or ordinance, to adopt rules to administer an income tax
imposed by the City in accordance with this Chapter. Such rules shall not conflict with or be inconsistent
with any provision of this Chapter. Taxpayers are hereby required to comply not only with the requirements
of this chapter, but also to comply with the Rules and Regulations.
All rules adopted under this section shall be published and posted on the internet.
1501.23 RENTAL AND LEASED PROPERTY.
(A) All property owners of real property located in the City, who rent or otherwise lease the same, or any
part thereof, to any person for residential dwelling purposes, including apartments, rooms and other rental
accommodations, during any calendar year, or part thereof, commencing with the effective date of this
section, shall file with the Tax Administrator on or before the January 31 first following such calendar year
a written report disclosing the name, address and also telephone number, if available, of each tenant known
to have occupied on December 31 during such calendar year such apartment, room or other residential
dwelling rental property.
(B) The Tax Administrator may order the appearance before him, or his duly authorized agent, of any
person whom he believes to have any knowledge of the name, address and telephone number of any tenant
of residential rental real property in the City. The Tax Administrator, or his duly authorized agent, is
authorized to examine any person, under oath, concerning the name, address and telephone number of any
tenant of residential real property located in the City. The Tax Administrator, or his duly authorized agent,
may compel the production of papers and records and the attendance of all personal before him, whether as
parties or witnesses, whenever he believes such person has knowledge of the name, address and telephone
number of any tenant of residential real property in the City.
(C) Any property owner or person that violates one or more of the following shall be subject to Section
1501.99 of this Chapter:
(1) Fails, refuses or neglects to timely file a written report required by subsection (a) hereof; or
(2) Makes an incomplete or intentionally false written report required by subsection (a) hereof; or
(3) Fails to appear before the Tax Administrator or any duly authorized agent and to produce and
disclose any tenant information pursuant to any order or subpoena of the Tax Administrator as authorized
in this section; or
50
(4) Fails to comply with the provisions of this section or any order or subpoena of the Tax
Administrator.
1501.24 SAVINGS CLAUSE.
This Chapter shall not apply to any person, firm or corporation, or to any property as to whom or which
it is beyond the power of Council to impose the tax herein provided for. Any sentence, clause, section or
part of this Chapter or any tax against or exception granted any individual or any of the several groups of
persons, or forms of income specified herein if found to be unconstitutional, illegal or invalid, such
unconstitutionality, illegality or invalidity shall affect only such clause, sentence, section or part of this
Chapter and shall not affect or impair any of the remaining provisions, sentences, clauses, sections or other
parts of this Chapter. It is hereby declared to be the intention of Council that this Chapter would have been
adopted had such unconstitutional, illegal or invalid sentence, or part hereof, not been included therein.
1501.25 COLLECTION OF TAX AFTER TERMINATION OF ORDINANCE.
(A) This chapter shall continue effective insofar as the levy of taxes is concerned until repealed, and insofar
as the collection of taxes levied hereunder and actions or proceedings for collecting any tax so levied or
enforcing any provisions of this chapter are concerned, it shall continue effective until all of said taxes
levied hereunder in the aforesaid periods are fully paid and any and all suits and prosecutions for the
collection of said taxes or for the punishment of violations of this chapter shall have been fully terminated,
subject to the limitations contained in Section 1501.12 and Section 1501.99 hereof.
(B) Annual returns due for all or any part of the last effective year of this ordinance shall be due on the
date provided in Sections 1501.05 and Section 1501.04 of this ordinance as though the same were
continuing.
1501.26 ADOPTION OF RITA RULES AND REGULATIONS.
The City hereby adopts the Regional Income Tax Agency (RITA) Rules & Regulations, including
amendments that may be made from time to time, for use as the City’s Income Tax Rules and Regulations.
In the event of a conflict with any provision(s) of the City Income Tax Ordinance and the RITA Rules &
Regulations, the Ordinance will supersede. Until and if the contractual relationship between the City and
RITA ceases, Section 1501.26 will supersede all other provisions within Ordinance 2023-143 regarding
promulgation of rules and regulations by the Tax Administrator.
1501.27 ELECTION TO BE SUBJECT TO R.C. 718.80 TO 718.95
(A)
The City hereby adopts and incorporates herein by reference Sections 718.80 to 718.95 of the ORC
for tax years beginning on or after January 1, 2018.
(B) A taxpayer, as defined in division (C) of this section, may elect to be subject to Sections 718.80 to
718.95 of the ORC in lieu of the provisions of this Chapter.
(C) “Taxpayer” has the same meaning as in section 718.01 of the ORC, except that “taxpayer”
does not include natural persons or entities subject to the tax imposed under Chapter 5745 of the ORC.
“Taxpayer” may include receivers, assignees, or trustees in bankruptcy when such persons are required to
assume the role of a taxpayer.
51
1501.99 VIOLATIONS; PENALTIES.
(A) Whoever violates Section 1501.17, division (A) of Section 1501.16, or Section 1501.04 by failing to
remit the City income taxes deducted and withheld from an employee, shall be guilty of a misdemeanor of
the first degree and shall be subject to a fine of not more than $1,000 or imprisonment for a term of up to
six months, or both. If the individual that commits the violation is an employee, or official, of the City, the
individual is subject to discharge from employment or dismissal from office.
(B) Any person who discloses information received from the Internal Revenue Service in violation of
division (A) of Section 1501.16 shall be guilty of a felony of the fifth degree and shall be subject to a fine
of not more than $5,000 plus the costs of prosecution, or imprisonment for a term not exceeding five years,
or both. If the individual that commits the violation is an employee, or official, of the City, the individual
is subject to discharge from employment or dismissal from office.
(C) Each instance of access or disclosure in violation of division (A) of Section 1501.16 constitutes a
separate offense.
(D) If not otherwise specified herein, no person shall:
(1) Fail, neglect or refuse to make any return or declaration required by this ordinance;
(2) File any incomplete or false return;
(3) Fail, neglect or refuse to pay the tax, penalties or interest imposed by this Chapter;
(4) Refuse to permit the Tax Administrator or any duly authorized agent or employee to examine his
books, records, papers and federal and state income tax returns relating to the income or net profits of a
taxpayer;
(5) Fail to appear before the Tax Administrator and to produce his books, records, papers or federal
and state income tax returns relating to the income or net profits of a taxpayer upon order or subpoena of
the Tax Administrator;
(6) Refuse to disclose to the Tax Administrator any information with respect to the income or net
profits of a taxpayer;
(7) Fail to comply with the provisions of this ordinance or any order or subpoena of the Tax
Administrator authorized hereby;
(8) Give to an employer false information as to his true name, correct social security number, and
residence address, or fail to promptly notify an employer of any change in residence address and date
thereof;
(9) Attempt to do anything whatsoever to avoid the payment of the whole or any part of the tax,
penalties or interest imposed by this Chapter.
(E) Any person who violates any of the provisions in Section 1501.99 (D) shall be subject to the penalties
provided for in Section 1501.99 (A) of this Chapter.
---
[2023-143 Code 1501 Amend.pdf]
CITY OF NORTH OLMSTED
ORDINANCE NO. 2023 - 143
By: Mayor Jones
AN ORDINANCE AMENDING AND RESTATING CHAPTER
FIFTEEN, TITLE ONE OF THE CODIFIED ORDINANCES
OF THE CITY OF NORTH OLMSTED TITLED, “TAXATION
CODE; MUNICIPAL INCOME TAX” IN ORDER TO
IMPLEMENT REVISED STANDARDS REQUIRED BY THE
OHIO LEGISLATURE, AND DECLARING AN EMERGENCY.
WHEREAS, the Home Rule Amendment of the Ohio Constitution, Article XVII,
Section 3, provides that “Municipalities shall have authority to exercise all powers of local self-
government,” and the municipal taxing power is one of such powers of local self-government
delegated by the people of the State to the people of municipalities; and
WHEREAS, Article XIII, Section 6 of the Ohio Constitution provides that the General
Assembly may restrict a municipality’s power of taxation to the extent necessary to prevent
abuse of such power, and Article XVIII, Section 13 of the Ohio Constitution states that “laws
may be passed to limit the powers of municipalities to levy taxes and incur debts for local
purposes”; and
WHEREAS, the General Assembly has determined that it is necessary and appropriate
to comprehensively review and amend Chapter 718 of the Ohio Revised Code (ORC), setting
forth statutory requirements for municipal income tax codes in Ohio; and
WHEREAS, upon a detailed review of H.B. 33 and the Codified Ordinances of the City
of North Olmsted by the Director of Finance and thereafter reported to the Council, this
Ordinance is found and determined by this Council to enact the amendments required prior to
the January 1, 2024 deadline to be in accord with the provisions and limitations specified in
Chapter 718 of the Ohio Revised Code; and
NOW THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF
NORTH OLMSTED, STATE OF OHIO THAT:
SECTION 1: That Chapter 15, Title One of the Codified Ordinances, titled “Taxation
Code; Municipal Income Tax” which presently reads in its entirety as set forth in Exhibit A,
which is attached to this Ordinance and incorporated by reference as if fully rewritten herein,
shall be amended and, as amended, shall read in its entirety as set forth in Exhibit B, which is
likewise attached to this Ordinance and incorporated by reference as if fully rewritten herein.
SECTION 2: It is found and determined by the Council that this Ordinance is to have
prospective application only. Salaries, wages, commissions and other compensation, together
with net profits, or any other income subject to the North Olmsted municipal income tax and
earned in and prior to the year 2024 shall be governed by Chapter 15, Title One of the Codified
Ordinances, titled “Taxation Code; Municipal Income Tax” as it existed immediately prior to
the effective date of this Ordinance.
SECTION 3: That this Ordinance is hereby declared to be an emergency measure
immediately necessary for the preservation of the public health, safety and welfare, and for the
reason that this legislation must go into effect immediately in order to be in effect by January 1,
2024; and further provided it receives the affirmative vote of two-thirds of all members of
Council, it shall take effect and be in force on January 1, 2024, following passage and approval
by the Mayor.
PASSED: ________________________
First Reading: _______________
Second Reading: _______________
Third Reading: _______________
Committee: __________________
ATTEST:
_____________________________
__________________________
BEATRICE TAYLOR
LOUIS BROSSARD
Clerk of Council
President of Council
APPROVED: _____________________
APPROVED AS TO LEGAL FORM:
_______________________________
/s/ Michael R. Gareau, Jr. ______
MAYOR NICOLE DAILEY JONES
MICHAEL R. GAREAU, JR.
Director of Law