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Such tax shall be levied, collected and paid with respect to the salaries, wages, commissions and other compensation, and with respect to the net profits of businesses, professions or other activities on or after July 1, 1969.
(Ord. 62-1995. Passed 7-3-95.)
DETERMINATION OF ALLOCATION OF TAX
In the taxation of income which is subject to municipal income taxes, the portion of the entire net profits of a taxpayer to be allocated as having been derived from within the municipality, shall be determined as follows:
(a) Multiply the entire net profits by a business allocation percentage to be determined by a three-factor formula of property, payroll and sales, each of which shall be given equal weight, as follows:
(1) The average net book value of the real and tangible personal property owned or used by the taxpayer in the business or profession in the municipality during the taxable period to the average net book value of all the real and tangible personal property owned or used by the taxpayer in the business or profession during the same period, wherever situated.
As used in the preceding paragraph, "real property" includes property rented or leased by the taxpayer and the value of such property shall be determined by multiplying the annual rental thereon by eight.
(2) Wages, salaries and other compensation paid during the taxable period to persons employed in the business or profession for services performed in the municipality to wages, salaries and other compensation paid during the same period to persons employed in the business or profession, wherever their services are performed.
(3) Gross receipts of the business or profession from sales made and services performed during the taxable period in the municipality to gross receipts of the business or profession during the same period from sales and services, wherever made or performed.
(b) In the event that the foregoing allocation formula does not produce an equitable result, another basis may, under uniform regulations, be substituted so as to produce such result. If the Tax Administrator approves the use of books and records as a substitute, the following shall apply:
(1) The net profits allocable to the Village of Silver Lake from business, professional, or other activities conducted in the Village of Silver Lake by corporations or unincorporated entities (whether resident or non- resident) may be determined from the records of the taxpayer only if the taxpayer has bona fide records which disclose with reasonable accuracy what portion of his net profits is attributable to that part of his activities conducted within the Village of Silver Lake.
(2) If the books and records are used as the basis for apportioning net profits, a statement must accompany the return explaining the manner in which such apportionment is made in sufficient detail to enable the Tax Administrator to determine whether the net profits attributable to the Village of Silver Lake are apportioned with reasonable accuracy.
(3) In determining the income allocable to the Village of Silver Lake from the books and records of a taxpayer, an adjustment may be made for the contribution made to the production of such income by headquarters activities of the taxpayer, whether such headquarters is within or without the Village of Silver Lake.
(Ord. 16-2005. Passed 2-7-05.)
(a) All sales of tangible personal property which is delivered within the Village regardless of where title passes if shipped or delivered from a stock of goods within the Village;
(b) All sales of tangible personal property which is delivered within the Village, regardless of where title passes even though transported from a point outside the Village, if the taxpayer is regularly engaged through its own employees in the solicitation or promotion of sales within the Village and the sales results from such solicitation or promotion;
(c) All sales of tangible personal property which is shipped from a place within the Village to purchasers outside the Village, regardless of where title passes, if the taxpayer is not, through its own employees, regularly engaged in the solicitation or promotion of sales at the place where delivery is made.
(Ord. 62-1995. Passed 7-3-95.)
(a) Add together the percentages determined in accordance with Section 171.06(a), (b) and (c) above or such of the aforesaid percentages as are applicable to the particular taxpayer and divide the total so obtained by the number of percentages used in deriving such total in order to obtain the business allocation percentage referred to above.
(b) A factor is applicable even though it may be allocable entirely in or outside the municipality. (Ord. 62-1995. Passed 7-3-95.)
(a) Rental income received by a taxpayer shall be included in the computation of net profits from business activities under Section 171.03(c), (d) and (e). Rental, ownership, management or operation of the real estate from which rentals are derived (whether so rented, managed or operated by the taxpayer individually or through agents or other representatives) constitutes a business activity and is therefore taxable.
(Ord. 70-1997. Passed 9-15-97.)
(b) (EDITOR’S NOTE: Former subsection (b) was repealed by Ordinance 70- 1997.)
(a) The portion of a net operating loss sustained in any taxable year subsequent to July 1, 1969, allocable to the municipality may be applied against the portion of the profit of succeeding tax years allocable to the municipality, until exhausted, but in no event for more than five 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.
(b) The portion of net operating loss sustained shall be allocated to the municipality in the same manner as provided herein for allocating net profits to the municipality.
(c) The Administrator shall provide by rules and regulations the manner in which such net operating loss carry-forward shall be determined.
(Ord. 62-1995. Passed 7-3-95.)
EXEMPTIONS
The tax provided for herein shall not be levied on the following:
(a) Pay or allowances of active 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 (as defined by the Ohio Revised Code) or tax-exempt activities.
(b) 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.
(c) Proceeds of insurance paid by reason of the death of the insured, pensions, disability benefits, annuities or gratuities not in the nature of compensation for services rendered from whatever source derived.
(d) Receipts from seasonal or casual entertainment, amusements, sport events and health and welfare activities when any such are conducted by bonafide charitable, religious or educational organizations and associations.
(e) Alimony received.
(f) Personal earnings of any natural person under eighteen years of age.
(g) Compensation for personal injuries or for damages to property by way of insurance or otherwise.
(h) Interest, dividends and other revenue from intangible property. (As defined by the Ohio Revised Code).
(i) Gains from involuntary conversion, cancellation of indebtedness, interest on federal obligations, items of income already taxed by the State of Ohio from which the municipality is specifically prohibited from taxing, and income of a decedent's estate during the period of administration (except such income from the operation of a business).
(j) 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 state or their political subdivisions to impose net income taxes on income derived from interstate commerce.
(k) Salaries, wages, commissions and other compensation and net profits, the taxation of which is prohibited by the Constitution for the State of Ohio or any act of the Ohio General Assembly limiting the power of the municipality to impose net income taxes.
(l) Parsonage allowance, to the extent of the rental allowance or rental value of the house provided as a part of the ordained minister’s compensation. The ordained minister must be duly ordained, commissioned, or licensed by a religious body constituting a church or church denomination, and must have authority to perform all sacraments of the church.
(Ord. 16-2005. Passed 2-7-05.)
RETURNS
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