(a) Interest and penalties. All taxes imposed by this chapter, including taxes withheld or required to be withheld from wages by an employer and remaining unpaid after they have become due, shall bear interest on the amount of the unpaid tax at the rate of 1% of the amount of the unpaid tax for each month or fraction of a month, and the taxpayers upon whom the taxes are imposed, and the employers required by this chapter to deduct, withhold and pay taxes imposed by this chapter shall be liable, in addition thereto, to a penalty of 1% of the amount of the unpaid tax for each month or fraction of a month of nonpayment, or $50, whichever is the greater. Any business which fails to withhold taxes and/or file a completed return with the proper tax due shall be assessed an additional $200. The Finance Director may abate interest or penalties or both, and upon refusal to abate interest or penalties, or both, by the Finance Director, the Board of Review may nevertheless abate interest or penalties or both.
(b) Underpaying estimated taxes. There is a charge for underpaying the tax. When estimate tax payments are required, the penalty will attach when the amount actually paid and the amount that should have been paid of the estimated tax was less than 90% of the amount shown on the final return and did not equal at least 100% of the previous year's liability. Failure to pay 80% of tax due by February 28 of the following year will result in a penalty and interest charge on the entire remaining tax balance.
(c) Returned check fee. In addition to any other charges for interest and/or penalties which may be applicable, a charge of up to $50 shall be added to the tax due when any check in payment of taxes is returned unpaid by the bank. This charge is to offset the cost of additional bookkeeping and processing and is made irrespective of any charge which may be levied against the maker by his or her bank. Notice by the Finance Director to the taxpayer that a check has been returned unpaid is not required, nor is notice of the above charge required. The tender of payment shall not be considered as received as long as this charge has not been paid. Failure to replace the dishonored check by a valid payment within 30 days from the date the city received the unpaid check from the bank shall be considered cause for prosecution.
(d) Exceptions.
(1) No penalty shall be assessed on additional taxes found during an audit to be due when a return was timely filed in good faith and the tax paid thereon within 30 days of notification.
(2) In the absence of fraud neither a penalty nor interest shall be assessed on any additional taxes resulting from a federal audit for federal income tax purposes, provided an amended return is filed and the additional tax paid within three months after final determination of the federal tax liability. Such amended returns shall be on a form obtainable on request from the Administrator. A taxpayer may not change the method of accounting (i.e., cash or accrual) or apportionment of net profits after the due date for filing the original return.
(3) A taxpayer may not change the method of accounting (i.e., cash or accrual) or apportionment of net profits after the due date for filing the original return.
(4) A taxpayer or employer shall have 30 days after receipt of notice of any proposed imposition of interest and penalties within which to file a written protest or explanation with the Finance Director. If no protest or explanation is filed within the prescribed time, the proposed imposition of interest and penalties shall become and be the final assessment. Upon filing of a written protest or explanation the Finance Director shall determine the assessment, which may or may not be the same as the proposed assessment.
(e) Abatement. Upon recommendation of the Finance Director, the Board of Review may abate interest or penalties, or both, and upon appeal from the refusal of the Finance Director to so recommend, the Board of Review may nevertheless abate interest or penalty or both.
(f) Violations.
(1) The following shall be considered violations of this chapter:
A. Failing, neglecting or refusing to make any return or declaration required by this chapter;
B. Making any incomplete, false or fraudulent return;
C. Failing, neglecting or refusing to pay the tax, penalties or interest imposed by this chapter;
D. Failing, neglecting or refusing to withhold the tax from employees or to remit the withholding to the Finance Director;
E. Refusing to permit the Finance Director or any duly authorized agent or employee to examine books, records, papers and federal and state income tax returns relating to the income or net profits of a taxpayer;
F. Failing to appear before the Finance Director and to produce books, records, federal and state income tax returns, and papers relating to the income or net profits of a taxpayer under order or subpoena of the Finance Director;
G. Refusing to disclose to the Finance Director any information with respect to the income or net profits of a taxpayer;
H. Failing to comply with the provisions of this chapter or any order or subpoena of the Finance Director authorized hereby;
I. Attempting to do anything whatever to avoid the payment of the whole or any part of the tax, penalties or interest imposed by this chapter;
J. Giving to an employer false information as to his or her true name, correct Social Security number and residence address, or failing to promptly notify an employer of any change in residence address and the date thereof;
K. Failing to use ordinary diligence in maintaining proper records of employees' residence addresses, total wages paid and municipal tax withheld, or to knowingly give the Finance Director false information.
(2) Any person who violates any of the provisions of this section shall be subject to the penalty provided in § 880.99.
(g) Limitations on prosecution.
(1) Civil actions to recover municipal income taxes and penalties and interest on municipal income taxes shall be brought within three years after the tax was due or the return was filed, whichever is later.
(2) Prosecutions under this chapter shall be commenced within three years after the commission of the offense, provided that in the case of fraud, failure to file a return, or the omission of 25% or more of income required to be reported, prosecutions may be commenced within six years after the commission of the offense.
(h) Failure to receive forms no excuse. The failure of any employer or person to receive or procure a return, declaration or other required form shall not excuse him or her from making any informational return, return or declaration, filing a form or paying the tax.
(Ord. 43-2004, passed 12-20-2004; Ord. 49-2005, passed 12-5-2005)