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Hudson Overview
Hudson, OH Code of Ordinances
CODIFIED ORDINANCES OF HUDSON, OHIO
CERTIFICATION
OFFICIALS
ADOPTING ORDINANCE
COMPARATIVE SECTION TABLE
TABLES OF SPECIAL ORDINANCES
CHARTER
PART TWO - ADMINISTRATION CODE
PART FOUR - TRAFFIC CODE
PART SIX - GENERAL OFFENSES CODE
PART EIGHT - BUSINESS REGULATION AND TAXATION CODE
TITLE TWO - Business Regulation
TITLE FOUR - Taxation
CHAPTER 890 Earned Income Tax Regulations Effective Through December 31, 2015
890.01 PURPOSE OF TAX.
890.02 DEFINITIONS.
890.03 IMPOSITION OF TAX.
890.04 EFFECTIVE PERIOD.
890.05 DETERMINATION OF ALLOCATION OF TAX.
890.06 SALES MADE IN THE MUNICIPALITY.
890.07 TOTAL ALLOCATION.
890.08 RENTALS.
890.09 OPERATING LOSS CARRY-FORWARD.
890.10 SOURCES OF INCOME NOT TAXED.
890.11 WHEN RETURN REQUIRED TO BE MADE.
890.12 FORM AND CONTENT OF RETURNS.
890.13 EXTENSION OF TIME FOR FILING RETURNS.
890.14 CONSOLIDATED RETURNS.
890.15 AMENDED RETURNS.
890.16 PAYMENT OF TAX ON FILING OF RETURN.
890.17 COLLECTION AT SOURCE.
890.171 FUNDAMENTAL CHANGES; SUCCESSOR EMPLOYERS.
890.18 DECLARATION OF INCOME.
890.19 FILING OF DECLARATION.
890.20 FORM OF DECLARATION.
890.21 PAYMENT TO ACCOMPANY DECLARATION.
890.22 FILING OF ANNUAL RETURN.
890.23 INTEREST ON UNPAID TAX.
890.24 INTEREST AND PENALTIES.
890.25 EXCEPTIONS TO PENALTIES.
890.26 ABATEMENT OF INTEREST AND PENALTY.
890.27 VIOLATIONS.
890.28 LIMITATION ON PROSECUTION.
890.29 FAILURE TO PROCURE FORMS.
890.30 COLLECTION OF UNPAID TAXES; ADDITIONAL ASSESSMENTS.
890.31 REFUNDS OF TAXES ERRONEOUSLY PAID.
890.32 AMOUNTS OF LESS THAN ONE DOLLAR.
890.33 TAX CREDIT.
890.34 CLAIM FOR CREDIT.
890.35 DISBURSEMENT OF FUNDS COLLECTED.
890.36 DUTIES OF ADMINISTRATOR.
890.37 ENFORCEMENT.
890.38 INSTALLMENT PAYMENTS.
890.39 DETERMINATION OF TAX.
890.40 INVESTIGATIONS.
890.41 PRODUCTION OF RECORDS.
890.42 REFUSAL TO PRODUCE RECORDS.
890.43 CONFIDENTIAL NATURE OF INFORMATION OBTAINED.
890.44 RETENTION OF RECORDS.
890.45 CENTRAL COLLECTION.
890.46 ESTABLISHMENT OF BOARD OF REVIEW.
890.47 BOARD TO APPROVE REGULATIONS AND TO HEAR APPEALS.
890.48 SEPARABILITY.
890.49 COLLECTION AFTER TERMINATION OF CHAPTER.
890.50 AGREEMENT WITH REGIONAL COUNCIL OF GOVERNMENTS FOR COLLECTION.
890.51 CIVIL ENFORCEMENT.
890.99 PENALTY.
CHAPTER 891 Earned Income Tax Regulations Effective Beginning January 1, 2016
CHAPTER 892 Community Reinvestment Program
CHAPTER 896 Motor Vehicle License Tax
CHAPTER 898 Enterprise Zones
PART TEN - STREETS, UTILITIES AND PUBLIC SERVICES CODE
PART TWELVE - PLANNING AND ZONING CODE
PART FOURTEEN - BUILDING AND HOUSING CODE
PART SIXTEEN - FIRE PREVENTION CODE
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890.01 PURPOSE OF TAX.
   To provide funds for the purposes of street, sidewalk/pathway/bikeway construction, maintenance and repair, storm sewer, sanitary sewer and water systems construction, maintenance and repair, debt service, capital improvements and such general Municipal purposes as Council shall determine including, specifically, at least, 7.5% of such tax being designated to provide funds for the Fire Department; 4.5% of such tax being designated to provide funds for Emergency Medical Services; 7.5% of such tax being designated to provide funds for the City's Park System; and 6% of such tax being designated to provide funds for construction and improvement of community learning centers in cooperation with the Hudson City School District, and related debt service, there is hereby levied a tax at the rate of 2% on all salaries, wages, commissions and other compensation, and on net profits, as hereinafter provided.
(Ord. 79-55. Passed 2-19-80; Ord. 90-64. Passed 8-20-90; Ord. 03-227. Passed 4-7-04.)
890.02 DEFINITIONS.
   As used in this chapter:
   (a)   "Adjusted Federal Taxable Income." For tax years prior to 2004, see definition of "Net Profits" as defined in this section. For taxable years 2004 and later, "Adjusted Federal Taxable Income" shall mean a C corporation's federal taxable income before net operating losses and special deductions as determined under the Internal Revenue Code, but including subsequent adjustments from required additions and deductions. Pass-through entities must compute "Adjusted Federal Taxable Income" as if the pass-through entity was a C corporation. This definition does not apply to any taxpayer required to file a return under Ohio R.C. 5745.03 or to the net profit from a sole proprietorship. This definition is effective for tax years beginning on or after January 1, 2004.
   (b)   "Administrator" means the Tax Administrator of the Municipality.
   (c)   "Association" means any partnership, limited partnership or any other form of unincorporated enterprise, owned by two or more persons.
   (d)   "Board of Review" means the Board created by and constituted as provided in Section 890.47.
   (e)   "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 other entity, excluding, however, all nonprofit corporations which are exempt from the payment of Federal income tax.
   (f)   "Corporation" means a corporation or joint stock association organized under the laws of the United States, the State or any other state, territory, foreign country or dependency.
   (g)   "Employee" means one who works for a wage, salary, commission or any other type of compensation in the service of an employer.
   (h)   "Employer" means an individual, partnership, association, corporation, government body, unit or agency or any other entity, whether or not organized for profit, who or that employs one or more persons on a salary, wage, commission or other basis of compensation.
   (i)   "Fiscal year" means an accounting period of twelve months or less ending on any day other than December 31.
   (j)   "Generic Form" shall mean an electronic or paper form designed for reporting estimated municipal income taxes, and/or annual municipal income tax liability, and/or requests for refunds, which contain all the information required on the Municipality's regular tax return, estimated payment forms and request for refund forms, and are in a similar format that will allow processing of the generic forms without altering the Municipality's procedures for processing forms.
   (k)   "Gross receipts" means the total income from any source whatever.
   (l)   "Municipality" means the Village of Hudson.
   (m)   "Net profits" means a net gain from the operation of a business, profession, enterprise or other activity after provision for all ordinary and necessary expenses either paid or accrued in accordance with the accounting system used by the taxpayer for Federal income tax purposes, without deduction of taxes imposed by this chapter or Federal, State and other taxes based on income, and, in the case of an association, without deduction of salaries paid to partners and other owners. If the Tax Administrator approves the use of books and records as a substitute method, the following shall apply:
      (1)   The net profits allocable to the Municipality from business, professional or other activities conducted in the Municipality by corporations or unincorporated entities (whether resident or nonresident) may be determined from the records of the taxpayer only if the taxpayer has bona fide records which disclose with reasonable accuracy what portion of his or her net profits is attributable to that part of his or her activities conducted within the Municipality.
      (2)   If the books and records of the taxpayer are used as the basis for apportioning net profits, a statement must accompany the return explaining the manner in which such apportionment is made in sufficient detail to enable the Tax Administrator to determine whether the net profits attributable to the Municipality are apportioned with reasonable accuracy.
      (3)   In determining the income allocable to the Municipality from the books and records of a taxpayer, an adjustment may be made for the contribution made to the production of such income by headquarters activities of the taxpayer, whether such headquarters is within or without the Municipality.
   (n)   "Nonresident" means an individual domiciled outside the Municipality.
   (o)   "Nonresident unincorporated business entity" means an unincorporated business entity not having an office or place of business within the Municipality.
   (p)   "Person" means every natural person, partnership, fiduciary, association or corporation. Whenever used in any clause prescribing and imposing a penalty, the term "person," as applied to any unincorporated entity, means the partners or members thereof, and as applied to corporations, the officers thereof.
   (q)   "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 or her regular employees regularly in attendance.
   (r)   "Qualifying wage" means wages as defined in Section 3121(a) of the Internal Revenue Code, without regard to any wage limitations, but including subsequent adjustments from required additions and deductions. "Qualifying wage" represents employees' income (including non-qualified deferred compensation and stock options) from which municipal tax shall be deducted by the employer, and any wages not considered a part of "qualifying wage" shall not be taxed by the Municipality. This definition is effective January 1, 2004 for taxable years 2004 and later.
   (s)   "Resident" means an individual domiciled in the Municipality.
   (t)   "Resident unincorporated business entity" means an unincorporated business entity having an office or place of business within the Municipality.
(Ord. 79-55. Passed 2-19-80.)
   (u)   "Taxable income" means wages, salaries and other compensation paid by an employer or employers before any deduction. "Other compensation" includes, but is not limited to, bonuses; commission; incentive payments; directors fees; property in lieu of cash; tips; contest prizes and awards; tax shelter plans; vacation and sick pay, regardless of label, such as sick leave, vacation pay, etc.; wage continuation plans; non-qualified deferred compensation; and stock option plans given as compensation to the extent to which it is included on the taxpayer's annual W-2 or applicable 1099s. "Other compensation" does not include dismissal or severance pay or supplemental income benefits for early retirement regardless of label. "Taxable income" shall also include income from gaming, wagering and lotteries, including the Ohio State Lottery, and/or the net profits from the operation of a business, profession or other enterprise or activity adjusted in accordance with the provisions of this chapter. "Taxable income" does not include intangible income, including patents, copyrights, trademarks, investments in real estate investment trusts, investments in regulated investment companies and appreciation on deferred income.
(Ord. 97-37. Passed 4-23-97.)
   (v)   "Taxable year" means the calendar year or the fiscal year upon the basis of which the net profits are to be computed under this chapter and, in the case of a return for a fractional part of a year, the period for which such return is required to be made.
   (w)   "Taxpayer" means a person, whether an individual, partnership, association, corporation or other entity, required hereunder to file a return or pay a tax.
(Ord. 79-55. Passed 2-19-80; Ord. 05-14. Passed 2-2-05.)
890.03 IMPOSITION OF TAX.
   An annual tax for the purposes specified in Section 890.01 shall be imposed on and after January 1, 2005, upon the following items of income, at the rate of 2%:
   (a)   On all salaries, wages, commissions and other compensation earned on and after January 1, 2005, by residents of the Municipality;
   (b)   On all salaries, wages, commissions and other compensation earned on and after January 1, 2005, by nonresidents of the Municipality for work done or services performed or rendered within the Municipality;
   (c)   On all salaries, wages, commissions and other compensation earned on and after January 1, 2005, for work done or services performed or rendered by employees of the City who are not otherwise subject to the provisions of this chapter;
   (d)   On the portion attributable to the Municipality on the net profits earned on and after January 1, 2005, of all resident unincorporated business entities or professions or other activities, derived from sales made, work done, services performed or rendered, and business or other activities conducted in the Municipality;
   (e)   On the portion of the distributive share of the net profits earned on and after January 1, 2005, of a resident partner or owner of a resident unincorporated business entity not attributable to the Municipality and not levied against such unincorporated business entity by the Municipality;
   (f)   On the portion attributable to the Municipality of the net profits earned on or after January 1, 2005, of all nonresident unincorporated business entities, professions or other activities, derived from sales made, work done, services performed or rendered, and business and other activities conducted in the Municipality, whether or not such unincorporated business entity has an office or place of business in the Municipality;
   (g)   On the portion of the distributive share of the net profits earned on and after January 1, 2005, of a resident partner or owner of a nonresident unincorporated business entity not attributable to the Municipality and not levied against such unincorporated business entity by the Municipality;
   (h)   On the portion attributable to the Municipality of the net profits earned on and after January 1, 2005, of all corporations, derived from sales made, work done, services performed or rendered, and business or other activities conducted in the Municipality, whether or not such corporations have an office or place of business in the Municipality; and
(Ord. 90-64. Passed 8-20-90.)
   (i)   On all proceeds from lotteries, gaming, wagering or schemes of chance, including the Ohio State Lottery, received by residents of the City or received by nonresidents of the City within the City or on the basis of activity conducted within the City.
(Ord. 97-37. Passed 4-23-97; Ord. 03-227. Passed 4-7-04.)
890.04 EFFECTIVE PERIOD.
   The tax shall be levied, collected and paid with respect to salaries, wages, commissions and other compensation, and with respect to the net profits of businesses, professions or other activities, earned on and after January 1, 2005, subject to collection in accordance with Section 890.49.
(Ord. 90-64. Passed 8-20-90; Ord. 03-227. Passed 4-7-04.)
890.05 DETERMINATION OF ALLOCATION OF TAX.
   In the taxation of income which is subject to Municipal income taxes, if the books and records of a taxpayer conducting a business or profession both within and without the boundaries of the Municipality disclose with reasonable accuracy what portion of its net profit is attributable to that part of the business or profession conducted within the boundaries of the Municipality, then only such portion shall be considered as having a taxable situs in the Municipality for the purposes of Municipal income taxation. The portion of the entire net profits of a taxpayer to be allocated as having been derived from within the Municipality, in the absence of actual records thereof, shall be determined as follows:
   Multiply the entire net profits by a business allocation percentage to be determined by a three-factor formula of property, payroll and sales, each of which shall be given equal weight as follows:
   (a)   The average net book value of the real and tangible personal property owned or used by the taxpayer in the business or profession in the Municipality during the taxable period to the average net book value of all 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 includes property rented or leased by the taxpayer and the value of such property shall be determined by multiplying the annual rental thereon by eight.
   (b)   Wages, salaries and other compensation paid during the taxable period to persons employed in the business or profession for services performed in the Municipality to wages, salaries and other compensation paid during the same period to persons employed in the business or profession, wherever their services are performed.
   (c)   Gross receipts of the business or profession from sales made and services performed during the taxable period in the Municipality to gross receipts of the business or profession during the same period from sales and services, wherever made or performed.
   In the event that the foregoing allocation formula does not produce an equitable result, another basis may, under uniform regulations, be substituted so as to produce such result.
(Ord. 79-55. Passed 2-19-80.)
890.06 SALES MADE IN THE MUNICIPALITY.
   As used in Section 890.05(c), "sales made in the Municipality" means:
   (a)   All sales of tangible personal property which is delivered within the Municipality, regardless of where title passes, if shipped or delivered from a stock of goods within the Municipality;
   (b)   All sales of tangible personal property which is delivered within the Municipality, regardless of where title passes, even though transported from a point outside the Municipality if the taxpayer is regularly engaged through his or her own employees in the solicitation or promotion of sales within the Municipality and the sales result from such solicitation or promotion; or
   (c)   All sales of tangible personal property which is shipped from a place within the Municipality to purchasers outside the Municipality, regardless of where title passes, if the taxpayer is not, through his or her own employees, regularly engaged in the solicitation or promotion of sales at the place where delivery is made.
(Ord. 79-55. Passed 2-19-80.)
890.07 TOTAL ALLOCATION.
   Add together the percentages determined in accordance with Section 890.05(a), (b) and (c) or such of the aforesaid percentages as are applicable to the particular taxpayer and divide the total so obtained by the number of percentages used in deriving the total in order to obtain the business allocation percentage referred to in Section 890.05.
   A factor is applicable even though it may be allocable entirely in or outside the Municipality.
(Ord. 79-55. Passed 2-19-80.)
890.08 RENTALS.
   Rental income received by a taxpayer shall be included in the computation of net profits from business activities under Section 890.03(c), (d) and (e) only if and to the extent that the rental, ownership, management or operation of the real estate from which such rentals are derived (whether so rented, managed or operated by a taxpayer, individually, or through agents or other representatives) constitutes a business activity of the taxpayer in whole or in part.
   Where the gross monthly rental of any and all real properties, regardless of number and value, aggregates in excess of four hundred fifty dollars ($450.00) per month, it shall be prima-facie evidence that the rental, ownership, management or operation of such properties is a business activity of such taxpayer, and the net income of such rental property shall be subject to tax. However, in the case of commercial property, the owner shall be considered engaged in a business activity when the rental is based on a fixed or fluctuating percentage of gross or net sales, receipts or profits of the lessee, whether or not such rental exceeds four hundred fifty dollars ($450.00) per month. Further, in the case of farm property, the owner shall be considered engaged in a business activity when he or she shares in crops or when the rental is based on a percentage of the gross or net receipts derived from the farm, whether or not the gross income exceeds four hundred fifty dollars ($450.00) per month. Further, the person who operates a licensed rooming house shall be considered in business whether or not the gross income exceeds four hundred fifty dollars ($450.00) per month.
   Property owners who are considered to have a business activity under the provisions of this section shall submit or cause to be submitted to the Administrator a list of names and addresses of all persons, firms, corporations or other entities occupying, leasing or renting any premises belonging to the property owner within this Municipality. The required list shall be prepared as of December 31 of each year and submitted on or before January 31 of the following year.
(Ord. 79-55. Passed 2-19-80.)
890.09 OPERATING LOSS CARRY-FORWARD.
   (a)   The portion of a net operating loss sustained in any taxable year subsequent to April 1, 1980, allocable to the Municipality, may be applied against the portion of the profit of succeeding tax years allocable to the Municipality until exhausted, but in no event for more than five taxable years immediately following the year in which the loss occurred. No portion of a net operating loss shall be carried back against net profits of any prior year.
   (b)   The portion of net operating loss sustained shall be allocated to the Municipality in the same manner as provided herein for allocating net profits to the Municipality.
   (c)   The Administrator shall provide by rules and regulations the manner in which such net operating loss carry-forward shall be determined.
(Ord. 79-55. Passed 2-19-80.)
890.10 SOURCES OF INCOME NOT TAXED.
   The tax provided for in this chapter shall not be levied on the following:
   (a)   Pay or allowance of active members of the Armed Forces of the United States or the income of religious, fraternal, charitable, scientific, literary or educational institutions to the extent that such income is derived from tax exempt real estate, tax exempt tangible or intangible property or tax exempt activities;
   (b)   Poor relief, unemployment insurance benefits, old age pensions or similar payments, including disability benefits received from local, State or Federal government or charitable, religious or educational organizations;
   (c)   Proceeds of insurance paid by reason of the death of the insured and pensions, disability benefits, annuities or gratuities not in the nature of compensation for services rendered from whatever source derived;
   (d)   Receipts from seasonal or casual entertainment, amusements, sports events and health and welfare activities when any such are conducted by bona fide charitable, religious or educational organizations and associations;
   (e)   Alimony received;
   (f)   Personal earnings of any natural person under eighteen years of age;
   (g)   Compensation for personal injuries or for damage to property by way of insurance or otherwise;
   (h)   Interest, dividends and other revenue from intangible property;
   (i)   Gains from involuntary conversion, cancellation of indebtedness, interest on Federal obligations, items of income already taxed by the State from which the Municipality is specifically prohibited from taxing and income of a decedent's estate during the period of administration (except such income from the operation of a business);
   (j)   Salaries, wages, commissions and other compensation and net profits, the taxation of which is prohibited by the United States Constitution or any act of Congress limiting the power of the states or their political subdivisions to impose net income taxes on income derived from interstate commerce; and
   (k)   Salaries, wages, commissions and other compensation and net profits, the taxation of which is prohibited by the Constitution of the State or any act of the General Assembly limiting the power of the Municipality to impose net income taxes.
   (l)   Parsonage allowance, to the extent of the rental allowance or rental value of a house provided as part of an ordained minister's compensation. The ordained minister must be duly ordained, commissioned or licensed by a religious body constituting a church or church denomination, and must have authority to perform all sacraments of the church.
(Ord. 79-55. Passed 2-19-80; Ord. 05-14. Passed 2-2-05.)
890.11 WHEN RETURN REQUIRED TO BE MADE.
   Each taxpayer shall, whether or not a tax is due thereon, make and file a return on or before April 30 of the year following the effective date of this chapter (Ordinance 79-55, passed February 19, 1980) and on or before April 30 of each year thereafter. When the return is made for a fiscal year or other period different from the calendar year, the return shall be filed within four months from the end of such fiscal year or period.
(Ord. 79-55. Passed 2-19-80.)
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