(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 §§ 192.035 through 192.039 of this chapter or subsection (b)(4) or (6) of this section, the tax shall be withheld at the rate, specified in §§ 192.035 through 192.039 of this chapter, of 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 subsection (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. 1. 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 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.
2. Payment under subsection (b)(1)A.1. 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 subsection (b)(1)A.1. 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.
(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 (b) 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 section 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 repotted 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 a 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 year;
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; and
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 (b), 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.
(Ord. 52-15, passed 11-4-2015) Penalty, see § 192.999