(a) An annual tax for the purposes specified in Section 181.01 hereof shall be imposed on and after January 1, 1985 at the rate of two percent (2%) per annum upon the following:
(1) On all salaries, wages, including sick pay, vacation pay, severance pay and supplemental unemployment pay, commissions and other compensation earned during the effective period of this chapter by residents of the City of Norwood.
(2) On all salaries, wages, including sick pay, vacation pay, severance pay, and supplemental unemployment pay, commissions and other compensation earned during the effective period of this chapter by non-residents of the City of Norwood for work done or services performed or rendered in the City of Norwood.
(3) A. On the portion of the net profits attributable to the City of Norwood, earned during the effective period of this chapter of all resident unincorporated businesses, associations, professions or other entities, derived from sales made, work done, services performed or rendered and business or other activities conducted in the City of Norwood.
B. On the portion of distributive share of the net profits earned during the effective period of this chapter of a resident partner or owner of a resident association or other unincorporated business entity not attributable to the City of Norwood and not levied against such unincorporated business entity or association by the City of Norwood.
(4) A. On the portion of the net profits attributable to the City of Norwood, earned during the effective period of this chapter, of all non-resident unincorporated businesses, associations, professions or other entities, derived from sales made, work done, or services performed or rendered and business or other activities conducted in the City of Norwood, whether or not such unincorporated association or business entity has an office or place of business in the City of Norwood.
B. On the portion of the distributive share of the net profits earned during the effective period of this chapter of a resident partner or owner of a nonresident association or other unincorporated business entity not attributable to the City of Norwood and not levied against such unincorporated business entity by the City of Norwood.
(5) On the portion of the net profits attributable to the City of Norwood earned during the effective period of this chapter of all resident and non-resident corporations derived from sales made, work done, services performed or rendered and business or other activities conducted in the City of Norwood, whether or not such corporations have an office or place of business in the City of Norwood.
(Ord. 93-2000. Passed 12-12-00.)
(Ord. 93-2000. Passed 12-12-00.)
(6) On all income received as gambling winnings by residents of the City of Norwood as reported on IRS Form W-2G, Form 5754 and or any other Form required by the Internal Revenue Service that reports winnings from gambling.
(Ord. 64-2003. Passed 8-26-03.)
(Ord. 64-2003. Passed 8-26-03.)
(b) Allocation of Net Profits. When a taxpayer conducts business, professional services or other activities both within and without the boundaries of this Municipality the portion of the net profits attributable to the City of Norwood shall be determined as provided in Section 718.02 of the Ohio Revised Code and in accordance with the Rules and Regulations adopted by the Tax Commissioner pursuant to this chapter.
(c) Operating Loss Carry Forward.
(1) The portion of a net operating loss sustained in any taxable year subsequent to January 1, 1966, allocable to the City of Norwood may be applied against the portion of the profit of succeeding year(s) allocable to the City of Norwood, until exhausted but in no event for more than three (3) 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.
(2) The portion of a net operating loss sustained shall be allocated to the City of Norwood in the same manner as provided herein for allocating net profits to the City of Norwood.
(3) In any return in which a net operating loss deduction is claimed, the following shall be furnished:
A. A copy of the Federal Income Tax Return for the year in which the net operating loss was sustained.
B. The amount of net operating loss used as a deduction in prior years.
C. The amount of net operating loss claimed as a deduction in the current year.
(4) The Tax Commissioner shall provide by Rules and Regulations the manner in which such net operating loss carry forward shall be determined.
(d) Consolidated Returns.
(1) Filing of consolidated returns may be permitted, required, or denied in accordance with the Rules and Regulations prescribed by the Tax Commissioner, provided that the income and expenses attributable only to the City of Norwood are clearly shown on the consolidated return.
(2) In the case of a corporation that carries on transactions with its stockholders or with other corporations related by stock ownership, interlocking directorates, or some other method, or in case any person operates a division, branch, factory, office, laboratory or activity within the City of Norwood constituting only a portion of its total business, the Tax Commissioner shall require such additional information as he may deem necessary to ascertain whether net profits are properly allocated to the City of Norwood. If the Tax Commissioner finds net profits are not properly allocated to the City of Norwood by reason of transactions with stockholders or with other corporations related by stock ownership, interlocking directorates, or transactions with such division, branch, factory, office, laboratory or activity or by some other method, he may require the filing of either a consolidated or separate return or he may adjust such transactions so as to produce a fair and proper allocation of net profits to the City of Norwood.
(e) Exceptions. Sources of income not taxed. The tax provided for herein shall not be levied on the following:
(1) Pay or allowance of 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.
(2) Poor relief, unemployment insurance benefits, old age pensions or similar payments including disability benefits received from local, state, or federal governments or charitable, religious or educational organizations.
(3) Proceeds of insurance paid by reason of the death of the insured; pensions, disability benefits, except as provided for in the Rules & Regulations, annuities or gratuities not in the nature of compensation for services rendered, from whatever source derived.
(4) Receipts from seasonal or casual entertainment, amusements, sports events, and health and welfare activities which are conducted by bona fide charitable, religious or educational organizations and associations.
(5) Alimony received.
(6) Personal earnings of any natural person under 16 years of age.
(7) Compensation for personal injuries or for damages to property by way of insurance or otherwise, but not including damages for loss of profits.
(8) Interest, dividends and other revenue from intangible property.
(9) 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.
(10) Capital gains.
(11) Dues, contributions and similar payments received by charitable, religious, educational organizations or labor unions, trade associations, lodges and similar organizations.
(12) Compensation paid under Section 3501.28 or 3501.36 of the Ohio Revised Code to a person serving as a precinct official, to the extent that such compensation does not exceed one thousand dollars ($1,000) annually. Such compensation in excess of one thousand dollars may be subjected to taxation. The payer of such compensation is not required to withhold City tax from that compensation.
(13) Compensation paid to an employee of a transit authority, regional transit authority, or regional transit commission created under Chapter 306 of the Ohio Revised Code for operating a transit bus or other motor vehicle for the authority or commission in or through the City, unless the bus or vehicle is operated on a regularly scheduled route, the operator is subject to such a tax by reason of residence or domicile in the City, or the headquarters of the authority or commission is located within the City.
(14) The income of a public utility when that public utility is subject bo the tax levied under Section 5727.24 or 5727.30 of the Ohio Revised Code, except starting January 1, 2002, the income of an electric company or combined company, as defined in Section 5727.01 of the Ohio Revised Code, may be taxed by a municipal corporation subject to Chapter 5745 of the Ohio Revised Code.
(15) The City of Norwood shall not tax the compensation of an individual if all of the following apply:
A. The individual does not reside in the City of Norwood;
B. The compensation is paid for personal services performed by the individual in the City of Norwood on twelve or fewer days during the calendar year;
C. In the case of an individual who is an employee, the principal place of business of the individual's employer is located outside the City of Norwood and the individual pays tax on compensation described in subsection (e)(15)B., of this section to the City, if any, in which the employer's principal place of business is located, and no portion of that tax is refunded to the individual.
D. The individual is not a professional entertainer or professional athlete, the promoter of a professional entertainment or sports event, or an employee of such a promoter, all as may be reasonably defined by the City of Norwood.
For purposes of the 12-day calculation, "Day" means any part of a 24-hour calendar day where compensation is earned in the City of Norwood. (Ord. 93-2000. Passed 12-12-00.)