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(a) "Gross receipts" means the total amounts received or accrued by a person from whatever source derived, including, but not limited to, amounts derived from sales, services, dealings in property, interest, rent, royalties, dividends, licensing fees, other fees, commissions and distributed amounts from other business entities. Except as otherwise specifically provided in this Article, gross receipts includes but is not limited to all amounts that constitute gross income for federal income tax purposes. Except as otherwise specifically provided in this Article, gross receipts includes all receipts, cash, credits and property of any kind or nature and including any amount for which credit is allowed by the seller to the purchaser, without any deduction therefrom on account of the cost of the property sold, the cost of materials used, labor or service costs, interest paid or payable, losses or any other expense whatsoever, except that cash discounts allowed or taken on sales shall not be included as gross receipts. Gross receipts, including advance payments, shall be included in a taxpayer's gross receipts at the time such receipts are recognized as gross income for federal income tax reporting purposes.
(b) "Gross receipts" with respect to any lease or rental shall include payment for any services that are part of the lease or rental, whether received in money or otherwise, that are paid to, on behalf of, or for the benefit of, the lessor, and all receipts, cash, credits, property of any kind or character and the fair market value of services so paid or rendered by the lessee.
(c) Treatment of Taxes. "Gross receipts" shall not include the amount of any federal, state, or local tax imposed on or with respect to retail sales whether imposed upon the retailer or upon the purchaser and regardless of whether the amount of tax is stated as a separate charge, or such part of the sales price of any property previously sold and returned by the purchaser to the seller which is refunded by the seller by way of cash or credit allowances given or taken as part payment on any property so accepted for resale. Gross receipts shall also not include any federal, state or local tax imposed upon a person for which that person is reimbursed by means of a separately stated charge to a purchaser, lessee, licensee or customer. Gross receipts shall not include any amount of third-party taxes that a taxpayer collects from or on behalf of the taxpayer's customers and remits to the appropriate governmental entity imposing such tax. Gross receipts shall not include any tax refunds received by a person from a governmental entity. Gross receipts shall include any federal, state or local tax not specifically excluded in this subsection.
(d) "Gross receipts" shall not include any amount received from or charged to any person that is a related entity to the taxpayer. Nor shall gross receipts include any grants received from governmental entities or any gifts. Gross receipts shall not include any investment receipts. "Investment receipts" includes interest, dividends, capital gains, other amounts received on account of financial instruments, and distributions from business entities, provided such items are directly derived exclusively from the investment of capital and not from the sale of property other than financial instruments, or from the provision of services, to any person. Gross receipts also shall not include any allocations of income or gain, or distributions (such as dividends, interest and other returns on capital) from an entity treated as a pass-through entity for federal income tax purposes, provided such allocations or distributions are derived exclusively from an investment in such entity, and not from any other property sold to, or services provided to, such entity. Any gross receipts of a pass-through entity which is subject to the gross receipts tax shall not also constitute gross receipts of any owner of that entity.
(e) Notwithstanding the provisions of subsection (a), "gross receipts" from the sale or exchange of stocks or other similar written instruments evidencing a right to participate in the assets of any business, or of bonds or other evidence of indebtedness, or of any other marketable securities (collectively referred to in this Article as "financial instruments"), or of any real property, shall not include the cost to acquire the financial instrument(s), or real property, sold or otherwise exchanged or converted. Nor shall "gross receipts" include the amount received by the original issuer of a financial instrument in exchange for such issuance. To the extent that any loss on the sale or exchange of financial instruments reduces the gross income of a person for federal income tax purposes in the year the loss is incurred, that loss shall reduce gross receipts from the sale or exchange of financial instruments, but in no event shall those receipts be less than zero, and in no event may any such loss be carried back or carried forward to reduce gross receipts in a tax year other than that in which the loss was incurred.
(f) No person shall be deemed to be engaging in business in the City if that person is an individual whose only gross receipts within the City are derived from investments of that individual's own funds in financial instruments. Gross receipts of an individual shall not include interest, dividends, capital gains and similar items or investment income earned from the investment of that individual's own capital.
(1) contracting with, acting through, or otherwise using the services of, any investment advisor or affiliate thereof which is not a related entity;
(2) maintaining documents of formation, incorporation, or registration within the City;
(3) being an owner, member, or other participant in an entity engaging in business within the City which is a pass-through entity for federal income tax purposes; or
(4) having trustees or directors who meet or reside within the City.
(Added by Proposition E, App. 11/6/2012, Oper. 1/1/2014)