For the purposes of this chapter the terms, phrases, words and their derivative shall have the meanings given in the next succeeding sections. The singular shall include the plural, and the masculine shall include the feminine and the neuter. As used in this chapter:
(a) “Adjusted 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 set forth in Sections 718.01(A)(1) of the Revised Code.
(b) “Administrative Rulings” mean the rulings issued by the Tax Administrator, upon the request of a taxpayer or employer, interpreting this chapter and the Rules and Regulations. Administrative Rulings shall be binding and effective upon issuance as to the taxpayer or employer requesting the ruling.
(c) “Administrator” means the person designated to administer and enforce the provisions of the Village Income Tax Ordinance, who also may be referred to in this Chapter as the “Tax Administrator.”
(d) “Association” means any partnership, limited partnership, limited liability company, limited liability partnership, Subchapter S corporation (“S corporation”) as defined in the Internal Revenue Code, or any other form of unincorporated business or enterprise taxed on a pass-through basis under the Internal Revenue Code. The terms “association,” “pass-through entity,” and “unincorporated business entity” are synonymous for purposes of this Chapter and the Rules and Regulations.
(e) “Board of Review” means the Board created by and constituted as provided in Section 791.15 of this Chapter.
(f) “Board of Tax Appeals” means the state board created pursuant to Section 5703.02 of the Revised Code.
(g) “Business” means any enterprise, activity, profession or undertaking of any nature conducted for profit or ordinarily conducted for profit, whether by an individual, partnership, association, corporation or any other entity, including but not limited to the renting or leasing of property, real, personal or mixed. For purposes of determining if “business is conducted within the Village,” any direct and/or indirect ownership of an interest in an association, pass-through entity or unincorporated business entity that conducts business within the Village is considered included.
(h) “Corporation” means a corporation or joint stock association organized under the laws of the United States, the State of Ohio or any other state, territory or foreign country or dependency, or any unincorporated entity treated as a corporation for federal income tax purposes. “Corporation” also includes a combined company, an electric company and a telephone company, as defined in Section 5727.01 of the Revised Code.
(i) “Employee” means one who works for qualifying wages in the service of an employer.
(j) “Employer” means an individual, partnership, association corporation governmental body, unit or agency, or any other entity, whether or not organized for profit, who or that employs one or more persons on a qualifying wage basis.
(k) “Fiscal year” means an accounting period of twelve months or less ending on any day other than December 31.
(l) “Gross receipts” means total revenue from any source whatever.
(m) “Intangible income” means that income specified in Section 718.01(A)(5) of the Revised Code including any of the following types of income: 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 Ohio Revised Code, 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, attributable to or derived from any lottery winnings or other similar games of chance.
(n) “Internal Revenue Code” means the Internal Revenue Code of 1986, 100 Stat. 2085, 26 U.S.C. 1, as amended.
(o) “Net profits” mean (i) if the taxpayer is a corporation, the corporation’s “adjusted federal taxable income” as that term is defined in Sections 718.01(A)(1)(a)-(f) of the Revised Code; (ii) if the taxpayer is an “association,” “pass-through entity,” or “unincorporated business entity,” “adjusted federal taxable income” as that term is defined in Section 718.01(A)(1)(g) of the Revised Code; and (iii) if the taxpayer is an individual, the individual’s profit, other than amounts specifically excluded in Section 718.01(F) of the Revised Code, required to be reported on federal Schedule C, Schedule E, or Schedule F, as provided by the Internal Revenue Service. The “net profits” of a taxpayer shall be adjusted in accordance with the provisions of this Chapter and the Rules and Regulations.
(p) “Nonresident” means an individual domiciled outside the Village of Gates Mills, Ohio.
(q) “Nonresident owner” means an individual domiciled outside the Village who has a direct or indirect ownership interest in an association, pass-through entity or unincorporated business entity that conducts business in the Village or a corporation that has a direct or indirect ownership interest in an association, pass- through entity or unincorporated business entity that conducts business in the Village.
(r) “Nonresident unincorporated business entity” means an unincorporated business entity not having an office or place of business within the Village.
(s) “Ohio Revised Code” means the codified statutes of the State of Ohio, as amended.
(t) “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.
(u) “Owner” means an individual, partner, member, or any other person having an ownership interest in an association, pass-through entity, or unincorporated business entity.
(v) “Pass-through entity” means a partnership, limited liability company, S corporation or any other type of entity the income or profits of which are given pass-through treatment under the Internal Revenue Code. "Income from a pass-through entity" includes partnership income of partners, membership interests of members of a limited liability company, distributive shares of shareholders of an S corporation, or other distributive or proportionate ownership shares of income from other pass- through entities.
(w) “Person” means individuals, firms, companies, business trusts, estates, trusts, partnerships, limited liability companies, associations, corporations, governmental entities, and any other entity. With respect to provisions of this chapter that impose or prescribe a penalty, the term “person” shall mean the owners of an association, pass-through entity and unincorporated business entity and the officers of a corporation.
(x) “Place of business” means any bona fide office, other than a mere statutory office, factory, warehouse or other space which is occupied and used by the taxpayer in carrying on any business activity individually or through one or more of his regular employees regularly in attendance.
(y) “Qualifying wages” means wages, as defined in Section 3121(a) of the Internal Revenue Code, without regard to any wage limitations, adjusted as provided in division (A)(2) of Section 718.03 of the Revised Code. "Qualifying wages" includes compensation attributable to a nonqualified deferred compensation plan or program as defined in Section 3121(v)(2)(C) of the Internal Revenue Code and compensation arising 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 by the stock option. "Qualifying wages" does not include compensation deferred before January 1, 2008, to the extent that the deferred compensation does not constitute "qualifying wages" when paid or distributed.
(z) “Resident” means an individual domiciled in the Village.
(aa) “Resident owner” means an individual domiciled in the Village who has an interest in an association, pass-through entity or unincorporated business entity.
(bb) “Nonresident unincorporated business entity” means an unincorporated business entity not having an office or place of business within the Village.
(Ord. 2007-55. Passed 12-11-07.)
(cc) “Royalty Income” means income earned by a taxpayer from a royalty interest in the production of an oil or gas well, whether managed, extracted or operated by the taxpayer individually or through an agent or other representative, shall be included in the computation of net profits from a business activity to the extent that such royalty interest constitutes a business activity of the taxpayer. Where the gross income received by a taxpayer from royalty interest in the production of an oil or gas well in a taxable year exceeds one thousand dollars ($1,000), it shall be prima facie evidence that the income was derived from a business activity of such taxpayer and the net income from such royalty interest shall be subject to tax.
(Ord. 2009-10. Passed 6-9-09.)
(dd) “Rules and Regulations” mean the Rules and Regulations promulgated by the Tax Administrator and approved by the Board of Review.
(ee) “S Corporation” means a corporation that has made an election under Subchapter S of Chapter 1 of Subtitle A of the Internal Revenue Code for its taxable year.
(ff) “State” means the State of Ohio.
(gg) “Tax Commissioner” means the Tax Commissioner of the State of Ohio.
(hh) “Taxable income” means all qualifying wages, net profits and all other income from whatever source derived set forth in Section 791.03 of this Chapter and the Rules and Regulations as taxable.
(ii) “Taxable Situs” means that portion of a taxpayer’s net profits attributable to the Village where the taxpayer conducts a business or profession both within and without the Village, determined in accordance with Section 718.02 of the Ohio Revised Code.
(jj) “Taxable year” means the corresponding tax reporting period as prescribed for the taxpayer under the Internal Revenue Code.
(kk) “Taxpayer” means a person subject to the tax imposed by this chapter, whether the tax is imposed on the taxable income of the entity in the hands of the entity or on the taxable income from the entity in the hands of the owners of the entity. “Taxpayer” does not include any person that is a disregarded entity or a qualifying subchapter S subsidiary for federal income tax purposes, but “taxpayer” includes any other person who owns the disregarded entity or qualifying subchapter S subsidiary.
(ll) “Unincorporated Business Entity” means either an “association,” “pass-through entity” or “corporation,” determined by the treatment afforded such entity for federal income tax purposes.
(mm) “Village” means the Village of Gates Mills, Ohio.
(Ord. 2007-55. Passed 12-11-07.)