(a) Municipal taxable income for a resident of the municipality is calculated as follows:
(1) Income reduced by exempt income to the extent such exempt income is otherwise included in income, reduced by allowable employee business expense deduction as found in Section 192.03(c)(27)B., further reduced by any pre-2017 net operating loss carry-forward equals municipal taxable income.
A. "Income" is defined in Section 192.03(c)(21).
1. "Qualifying wages" is defined in Section 192.03(c)(34).
2. "Net profit" is included in "income", and is defined in Section 192.03(c)(30). This section also provides that the net operating loss carry-forward shall be calculated and deducted in the same manner as provided in Section 192.03(c)(1)H. Treatment of net profits received by an individual taxpayer from rental real estate is provided in Section 192.062(e).
3. Section 192.03(c)(21) provides the following: offsetting and net operating loss carry-forward treatment in Section 192.03(c)(21)A.2.a.; resident's distributive share of net profit from pass through entity treatment in Section 192.03(c)(21)A.2.b.; treatment of S corporation distributive share of net profit in the hands of the shareholder in Section 192.03(c)(21)A.3.; restriction of amount of loss permitted to be carried forward for use by taxpayer in a subsequent taxable year in Section 192.03(c)(21)A.4.
4. "Pass through entity" is defined in Section 192.03(c)(36).
B. "Exempt income" is defined in Section 192.03(c)(16).
C. Allowable employee business expense deduction is described in Section 192.03(c)(27)B., and is subject to the limitations provided in that section.
D. "Pre-2017 net operating loss carry-forward" is defined in Section 192.03(c)(42).
(b) Municipal taxable income for a nonresident of the municipality is calculated as follows:
(1) Income reduced by exempt income to the extent such exempt income is otherwise included in income, as applicable, apportioned or sitused to the municipality as provided in Section 192.062, reduced by allowable employee business expense deduction as found in Section 192.03(c)(27)B., further reduced by any pre-2017 net operating loss carryforward equals municipal taxable income.
A. "Income" is defined in Section 192.03(c)(21).
1. "Qualifying wages" is defined in Section 192.03(c)(44).
2. "Net profit" is included in "income", and is defined in Section 192.03(c)(30). This section also provides that the net operating loss carry-forward shall be calculated and deducted in the same manner as provided in Section 192.03(c)(1)H. "Net profit" for a nonresident individual includes any net profit of the nonresident, but excludes the distributive share of net profit or loss of only pass through entity owned directly or indirectly by the nonresident.
3. "Pass through entity" is defined in Section 192.03(c)(36).
B. "Exempt income" is defined in Section 192.03(c)(16).
C. "Apportioned or sitused to the municipality as provided in Section 192.062 of this chapter" includes the apportionment of net profit income attributable to work done or services performed in the municipality. Treatment of net profits received by an individual taxpayer from rental real estate is provided in Section 192.062(e).
D. "Allowable employee business expense deduction" as described in Section 192.03(c)(27)B., is subject to the limitations provided in that section. For a nonresident of the municipality, the deduction is limited to the extent the expenses are related to the performance of personal services by the nonresident in the municipality.
E. "Pre-2017 net operating loss carry-forward" is defined in Section 192.03(c)(42).
(Ord. 1981. Passed 12-15-2015; Ord. 1992. Passed 11-8-2016; Ord. 2007. Passed 12-12-2017.)