For the purpose of this subchapter, the following definitions shall apply unless the context clearly indicates or requires a different meaning.
BUSINESS. Any enterprise, activity, trade, occupation, profession or undertaking of any nature conducted for gain or profit. BUSINESS shall not include a board of trade, chambers of commerce, trade associations or unions, or other associations performing services usually performed by trade associations or unions as recognized by the Internal Revenue Service. BUSINESS shall not include funds, foundations, corporations or associations organized and operated for the exclusive and sole purpose of religious, charitable, scientific, literary, educational, civic or fraternal purposes, where no part of the earnings, incomes or receipts of such unit, group or association, inures to the benefit of any private shareholder or other person.
BUSINESS ENTITY. Each separate corporation, limited liability company, business development corporation, partnership, limited partnership, registered limited liability partnership, sole proprietorship, association, joint stock company-receivership, trust, professional service organization or other legal entity through which business is conducted.
COMPENSATION. Wages, salaries, commissions or any other form of remuneration paid or payable by an employer for services performed by an employee, which are required to be reported for federal income tax purposes and adjusted as follows:
(1) Include any amounts contributed by an employee to any retirement, profit sharing or deferred compensation plan, which are deferred for federal income tax purposes under a salary reduction agreement or similar arrangement, including but not limited to salary reduction arrangements under I.R.C. §§ 401(a), 401(k), 402(e), 403(a), 403(b), 408, 414(h) or 457; and
(2) Include any amounts contributed by an employee to any welfare benefit, fringe benefit or other benefit plan made by salary reduction or other payment method which permits employees to elect to reduce federal taxable compensation under the Internal Revenue Code, including, but not limited to, I.R.C. §§ 125 and 132.
CONCLUSION OF THE FEDERAL AUDIT. The date that the adjustments made by the Internal Revenue Service to net income as reported on the business entity’s federal income tax return become final and unappealable.
COUNTY. The County of McLean, Kentucky.
EMPLOYEE. Any person who renders services to another person or any business entity for compensation, including an officer of a corporation and any officer, employee or elected official of the United States, a state or any political subdivision of a state, or any agency of instrumentality of any one or more of the above. A person classified as an independent contractor under the Internal Revenue Code shall not be considered an EMPLOYEE.
EMPLOYER. The person for whom an individual performs or performed any service, of whatever nature, as the employee of such person; except that:
(1) If the person for whom the individual performs or performed the services does not have control of the payment of the wages for such services, EMPLOYER means the person having control of the payment of such wages; and
(2) In the case of a person paying wages on behalf of a non-resident alien individual, foreign partnership or foreign corporation, not engaged in trade or business within the United States, EMPLOYER means such person.
FINAL DETERMINATION OF THE FEDERAL AUDIT. The revenue agent’s report or other documents reflecting the final and unappealable adjustments made by the Internal Revenue Service.
FISCAL YEAR. Fiscal year, as defined in I.R.C. § 7701(a)(24).
INTERNAL REVENUE CODE. The Internal Revenue Code, as defined in KRS 67.750(7), being 26 U.S.C. §§ 1 et seq.
NET PROFIT. Gross income, as defined in I.R.C. § 61, minus all the deductions from gross income allowed by I.R.C. Ch. 1, and adjusted as follows:
(1) Include any amount claimed as a deduction for state tax or local tax which is computed, in whole or in part, by reference to gross or net income and which is paid or accrued to any state of the United States, local taxing authority in a state, the District of Columbia, the Commonwealth of Puerto Rico, any territory or possession of the United States or any foreign country or political subdivision thereof;
(2) Include any amount claimed as a deduction that directly or indirectly is allocable to income which is either exempt from taxation or otherwise not taxed;
(3) Include any amount claimed as a net operating loss carryback or carryforward allowed under I.R.C. § 172;
(4) Include any amount of income and expenses passed through separately as required by the Internal Revenue Code to an owner of a business entity that is a pass-through entity for federal tax purposes; and
(5) Exclude any amount of income that is exempt from state taxation by the Kentucky Constitution or the Constitution and statutory laws of the United States.
PERSON. Every natural person, whether a resident or non-resident of the county. Whenever the word PERSON is used in a clause prescribing and imposing a penalty in the nature of a fine or imprisonment, the word, as applied to a partnership or other form of unincorporated enterprise, shall mean the partners or members thereof and, as applied to corporations, shall mean the officers and directors thereof.
OCCUPATIONAL TAX ADMINISTRATOR. The official appointed by the County Fiscal Court and charged with the general administration of the license fee and occupational and net profits license tax imposed by this subchapter.
RETURN or REPORT. Any properly completed and, if required, signed form, statement, certification, declaration or any other document permitted or required to be submitted or filed with the county.
SALES REVENUE. Receipts from the sale, lease or rental of goods, services or property.
TAXABLE NET PROFIT. In case of a business entity having payroll or sales revenue only within the county, means net profit, as defined in this section, and as apportioned under § 110.04 of this chapter.
TAXABLE YEAR. The calendar year or fiscal year ending during the calendar year, upon the basis of which net income is computed.
TAX DISTRICT. Any county or city with the authority to levy net profits or occupational license taxes.
TRADE, OCCUPATION AND PROFESSION. The doing of and remuneration for any type of work, activity or the rendering of any and all types of personal services, the holding of any kind of position or job within the county by a clerk, laborer, tradesman, manager, elected or appointed government official or other civil-service employee, and addition shall include and mean any non-resident of the county who is employed by and employer where the relationship between the individual performing the services and the person for whom such services are rendered is as to those legal services, the legal relationship of employer and employee, including also a partner of a firm or an officer of a firm or its corporation if such partner or officer receives a salary for his or her personal services rendered in the course of business of such firm or corporation where those services of such official or employee are rendered in whole or in part within the county.
(Ord. 20.220.7, passed 12-22-2020)