To provide funds for general municipal operations, maintenance of equipment, new equipment, extension, enlargement and improvement of municipal services and facilities and capital improvements of the City of Circleville, Ohio, there is hereby levied a tax upon earnings at the rate of one percent (1%). In addition to the one percent municipal income tax imposed by ordinance of Council, there is hereby imposed and levied a voter approved additional five-tenths of one percent (.5%) municipal income tax rate commencing July 1, 1988, to be set aside and allocated for the purpose of operating and maintaining the safety forces. Further, in addition to the one percent municipal income tax imposed by ordinance of Council, there is hereby imposed and levied a voter approved additional five-tenths of one percent (.5%) municipal income tax rate commencing January 1, 2015, with one-tenth of one percent (.1%) of this additional tax to be set aside and allocated for the purpose of operating and maintaining the safety forces and four-tenths of one percent (.4%) of this additional tax to be set aside and allocated for the purpose of capital improvements for the development and construction of street improvements and storm sewers; for parks and playgrounds; and for all city street lighting necessary. In addition, there is hereby imposed and levied a voter approved additional five-tenths of one percent (.5%) municipal income tax rate commencing January 1, 2020 and expiring on December 31, 2024, to be set aside and allocated solely for the purpose of operating and maintaining the safety forces. The imposed and levied total income tax of two and one-half percent (2.5%) is upon income as follows:
(Ord. 12-71-19. Passed 12-17-19.)
(a) On all income, salaries, qualifying wages, bonuses, commissions, and other compensation earned or received by resident individuals of the City.
(b) On all income, salaries, qualifying wages, bonuses, commissions, and other compensation earned or received by non-resident individuals of the City, for work done, services performed or rendered or attributed to work done or services performed or rendered in the City.
(c) Net Profits:
(1) On the net profits earned of all unincorporated businesses, professions, or other activities conducted by residents of the City.
(2) On the net profits earned of all unincorporated businesses, professions, or other activities conducted in the City by non-residents.
(3) For the purposes of paragraphs (c)(1), (2)above, an association shall be taxed as an entity, on the net profits of the association derived from sales made, work done or services performed or rendered and business or other activities conducted in the City, whether or not such association has its principal or any place of business located in the City.
(4) For the purposes of paragraph (c)(1) above, a resident of the City who is a member of an association is taxed individually on that resident’s entire share, whether distributed or not, of the annual net profits of the association which are not subject to entity filing under paragraph C (3) above.
(5) Limited Liability Companies (LLC) are taxed as an association and must file and pay any tax due on behalf of their members at the association level as described in (c)(3) and (c)(4) above.
(d) On the net profits earned, of all corporations, including S corporations, derived from sales made, work done or services performed or rendered and business or other activities conducted in the City.
(e) On all income from gambling, lottery, and/or sports winnings, except to the extent that they are excluded by Section 191.13(d), by a resident of the City. No regard is given to losses or to the location where the gambling, lottery, and/or sports winnings were received.
(f) The portion of the net profits attributable to the City of a taxpayer conducting a business, profession or other activity both within and without the boundaries of the City shall be determined as provided in Sections 718.01 and 718.02 of the Revised Code of Ohio in accordance with the Rules and Regulations adopted by the Council of the City pursuant to this chapter.
(g) Consolidated Returns.
(1) Any affiliated group which files a consolidated return for federal income tax purposes pursuant to Section 1501 of the Internal Revenue Code may file a consolidated return with the City of Circleville. However, once the affiliated group has elected to file a consolidated return or a separate return with the City of Circleville, the affiliated group may not change their method of filing in any subsequent tax year without written approval from the City of Circleville.
(2) In the case of a corporation that carried on transactions with its stockholders or with other corporations related by stock ownership, interlocking directorates, or some other method, the City Auditor shall require such information, in addition to the return hereinafter provided for, as he may deem necessary to ascertain whether net profits are properly allocated to the City. If the City Auditor finds net profits are not properly allocated to the City by reason of transactions with stockholders or with other corporations related by stock ownership, interlocking directorates, or some other method, he may require the filing of a consolidated return or adjust such transactions so as to produce a fair and proper allocation of net profits to the City.
(h) If a net operating loss has been sustained in any taxable year such losses may not be carried forward or backward to any other taxable year.
(i) Net profit from a business or profession conducted both within and outside the boundaries of the City shall be considered as having a taxable situs in the City for purposes of income taxation in the same proportion as the average ratio of:
(1) The average original cost of the real 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. 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.
(2) Wages, salaries, and other compensation or distributions paid during the taxable period to persons employed in the business or profession for services performed in the City to wages, salaries and other compensation or distributions paid during the same period to persons employed in the business or profession, wherever their services are performed. Wages, salaries, and other compensation shall be included to the extent that they represent qualifying wages.
(3) Gross receipts of the business or profession from sales made and services performed during the taxable period in the City to gross receipts of the business or profession during the same period from sales and service, wherever made or performed. Sales include the following:
A. All sales of tangible personal property which is delivered within the City regardless of whether title passes if shipped or delivered from a stock of goods.
B. All sales of tangible personal property which is delivered within the City regardless of where title passes even though transported from a point outside the City if 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.
C. All sales of tangible personal property which is shipped from a place within the City to purchasers outside the City regardless of where title passes if the taxpayer is not, through its own employees, regularly engaged in the solicitation or promotion of sales at the place where delivery is made.
In the event that the foregoing allocation formula does not produce an equitable result, another basis may, under guidelines established by the City, be substituted so as to produce such result.
(Ord. 01-02-2004. Passed 1-6-04.)