(a) The tax shall apply on the following types of income of a nonresident individual to the same extent and on the same basis that the income is subject to taxation under the Federal Internal Revenue Code.
(1) On a salary, bonus, wage, commission and other compensation for services rendered as an employee for work done or services performed in the City. Income that a nonresident taxpayer receives as the result of disability and after exhausting all vacation pay, holiday pay and sick pay is not compensation for services rendered as an employee for work done or services performed in the City. Vacation pay, holiday pay, sick pay and a bonus paid by the employer are deemed to have the same tax situs as the work assignment or work location and are taxable on the same ratio as the normal earnings of the employee for work actually done or services actually performed.
(2) On a distributive share of the net profits of a non-resident owner of an unincorporated business, profession, enterprise, undertaking or other activity, as a result of work done, services rendered and other business activities conducted in the City.
(3) On capital gains less capital losses from sales of, and on the net profits from rentals of, real and tangible personal property, if capital gains arise from property located in the city.
(b) The amount of taxable compensation of nonresidents working in and out of the City is to be computed by dividing the total number of days worked in the City by the total number of days worked during the year, or the total number hours worked in the City by the total member of hours worked during the year, and applying the resulting percentage to gross annual compensation, including vacation, holiday, sickness and bonus pay; except that the amount of taxable compensation of a nonresident compensated on the volume of business secured or other results achieved by him or her such as a salesperson on a commission basis, shall be the amount received by him or her for business secured or other results achieved by him or her attributable to his efforts in the City.
(c) The mere fact that a nonresident employee is subject to call at any time does not permit the allocation of compensation on a seven-day per week basis. The mere fact that a non-resident employee is compensated on a seven-day per week salary basis, when he or she does not in fact perform work or render services seven-days per week, does not permit the allocation of compensation on a seven-day per week basis. The mere fact that a nonresident employee takes work home with him or her and performs such work at his or her home does not permit the allocation of compensation.
(d) A nonresident employee who is paid commissions and renewal commissions for selling insurance, not a general insurance agent who conducts his or her own independent insurance business, shall allocate such compensation on the following basis: for life, health and accident insurance; the locus shall be the location of the purchaser of the insurance; for group insurance the locus shall be the location of the group; for fire and casualty insurance the locus shall be the location of the risk insured, except that on vehicles it shall be the location of the purchaser.
(e) Compensation paid to officers or employees of the State of Michigan is subject to the tax. Such compensation shall be taxable even though the services are performed on property owned or controlled by the State within the corporate limits of the City of Ionia.
(f) Compensation paid to officers or employees of the United States government not for service in the armed forces is subject to the tax. Such compensation shall be taxable even though the services are performed on property owned or controlled by the United States government within the corporate limits of the City of Ionia.
(g) The mere fact that part or all of the work of a nonresident employee working within the City limits may be attributable to branches, governmental units, projects, undertakings or other activities outside of the corporate limits of the City of Ionia does not give rise to an exclusion of the related compensation from taxable income.
(Ord. 360. Passed 12-11-93.)