(a) Where a resident of the City is subject to a municipal income tax in another municipality, he or she shall not pay a total municipal income tax on the same income greater than the tax imposed at the higher rate.
(b) Basis for credit. Every individual taxpayer who resides in the City who receives net profits, salaries, wages, commissions or other personal service compensation, for work done or services rendered outside of the City, if it be made to appear that he has paid a municipal income tax on the same income taxable under this Part to another municipality, shall be allowed a credit against the tax imposed by this Part 18 of the amount so paid by him, or in his behalf to such other municipality. The credit shall not exceed the tax assessed by this Part 18 on such income earned in such other municipalities where such tax is paid.
(c) A claim for credit or refund under this section shall be made in such manner as the Tax Director may by regulation provide. In the event such resident fails, neglects or refuses to file an annual return or declaration on the form furnished by or obtainable from the Tax Director, he shall not be entitled to such credit or refund or shall be considered in violation of this Part 18 for failure to file a return.
(Ord. 9984-2015. Passed 12-15-15.)
(a) For the purpose of this section, the following definitions shall apply unless the context clearly indicates or requires a different meaning.
(1) “Nonqualified deferred compensation plan” means a compensation plan described in Section 3121(v)(2)(C) of the Internal Revenue Code.
(2) “Qualifying loss.”
A. Except as provided in division (a)(2)B. of this section, “qualifying loss” means the excess, if any, of the total amount of compensation the payment of which is deferred pursuant to a nonqualified deferred compensation plan over the total amount of income the taxpayer has recognized for federal income tax purposes for all taxable years on a cumulative basis as compensation with respect to the taxpayer's receipt of money and property attributable to distributions in connection with the nonqualified deferred compensation plan.
B. If, for one or more taxable years, the taxpayer has not paid to one or more municipal corporations income tax imposed on the entire amount of compensation the payment of which is deferred pursuant to a nonqualified deferred compensation plan, then the “qualifying loss” is the product of the amount resulting from the calculation described in division (a)(2)A. of this section computed without regard to division (a)(2)B. of this section and a fraction the numerator of which is the portion of such compensation on which the taxpayer has paid income tax to one or more municipal corporations and the denominator of which is the total amount of compensation the payment of which is deferred pursuant to a nonqualified deferred compensation plan.
C. With respect to a 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.
(3) “Qualifying tax rate” means the applicable tax rate for the taxable year for the which the taxpayer paid income tax to a municipal corporation with respect to any portion of the total amount of compensation the payment of which is deferred pursuant to a nonqualified deferred compensation plan. 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 municipal corporation each year with respect to the nonqualified deferred compensation plan.
(b) (1) Except as provided in division (d) of this section, a refundable credit shall be allowed against the income tax imposed by a municipal corporation for each qualifying loss sustained by a taxpayer during the taxable year. The amount of the credit shall be equal to the product of the qualifying loss and the qualifying tax rate.
(2) A taxpayer shall claim the credit allowed under this section from each municipal corporation to which the taxpayer paid municipal income tax with respect to the nonqualified deferred compensation plan in one or more taxable years.
(3) If a taxpayer has paid tax to more than one municipal corporation 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.
(4) In no case shall the amount of the credit allowed under this section exceed the cumulative income tax that a taxpayer has paid to a municipal corporation for all taxable years with respect to the nonqualified deferred compensation plan.
(c) (1) For purposes of this section, municipal income tax that has been withheld with respect to a nonqualified deferred compensation plan shall be considered to have been paid by the taxpayer with respect to the nonqualified deferred compensation plan.
(2) Any municipal income tax that has been refunded or otherwise credited for the benefit of the taxpayer with respect to a nonqualified deferred compensation plan shall not be considered to have been paid to the municipal corporation by the taxpayer.
(d) The credit allowed under this section is allowed only to the extent the taxpayer's qualifying loss is attributable to:
(1) The insolvency or bankruptcy of the employer who had established the nonqualified deferred compensation plan; or
(2) The employee's failure or inability to satisfy all of the employer's terms and conditions necessary to receive the nonqualified deferred compensation.
(Ord. 9984-2015. Passed 12-15-15.)
A Municipality shall grant a credit against its tax on income to a resident of the City of Brook Park who works in a joint economic development zone created under R.C. § 715.691 or a joint economic development district created under R.C. §§ 715.70, 715.71, or 715.72 to the same extent that it grants a credit against its tax on income to its residents who are employed in another municipal corporation, pursuant to Section 1808.01 of this chapter.
(Ord. 9984-2015. Passed 12-15-15; Ord. 11375-2023. Passed 12-12-23.)
(a) Income tax that has been deposited or paid to the City of Brook Park, but should have been deposited or paid to another municipal corporation, is allowable by the City of Brook Park as a refund, but is subject to the three-year limitation on refunds as provided in Section 1809.06.
(b) Income tax that should have been deposited or paid to the City of Brook Park, but was deposited or paid to another municipal corporation, shall be subject to collection and recovery by the City of Brook park. To the extent a refund of such tax or withholding is barred by the limitation on refunds as provided in Section 1809.06, the City of Brook Park will allow a non-refundable credit equal to the tax or withholding paid to the other municipality against the income tax the City of Brook Park claims is due. If the City of Brook Park's tax rate is higher, the tax representing the net difference of the tax rates is also subject to collection by the City of Brook Park, along with any penalty and interest accruing during the period of nonpayment.
(c) No carryforward of credit will be permitted when the overpayment is beyond the three-year limitation for refunding of same as provided in Section 1809.06.
(d) Nothing in this section requires a Municipality to allow credit for tax paid to another municipal corporation if the City of Brook Park has reduced credit for tax paid to another municipal corporation. Section 1808.01 shall prevail regarding any limitation on credit.
(Ord. 9984-2015. Passed 12-15-15; Ord. 11375-2023. Passed 12-12-23.)