“Adjusting federal taxable income” 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) If the taxpayer is not a C corporation and is not an individual, the taxpayer shall compute “adjusted federal taxable income” as if the taxpayer were a C corporation, but guaranteed payments and other similar amounts paid or accrued to a partner, former partner, member, or former member shall not be allowed a deductible expense, with respect to each owner or owner-employee of the taxpayer, amounts paid or accrued to a qualified self employment retirement and amounts paid or accrued to or for health insurance or life insurance shall not be allowed as a deduction.
(b) Internal Revenue “special deductions” will not be taken into account for municipal tax purposes unless otherwise described in this chapter.
(c) Add any losses allowed as a deduction in the commutation 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) Deduct intangible income to the extent the intangible income is included in federal taxable income.
(e) Add expenses incurred in the production of intangible income.
(f) Add taxes on or measured by net income allowed as a deduction on the computation of federal taxable income.
(g) Add, in the case of each real estate investment trust and regulated investment company, all amounts, with respect to dividends to, distributions to, or amounts set aside for or credited to the benefit of investors, allowed as a deduction in the computation of federal taxable income.
(h) Nothing in this chapter requires a municipality to allow a net operating loss carry forward.
(i) Municipal tax calculation will not be adjusted for federal charitable contribution deductions.
(j) Federal section 179 deductions may not create a loss forward.
(Ord. 2005-129. Passed 12-6-05.)
IMPOSITION OF TAX