(A) Determining municipal taxable income for individuals.
(1) (a) Municipal taxable income for a resident of the municipality is calculated as follows:
(b) Income reduced by exempt income to the extent such exempt income is otherwise included in income, reduced by allowable employee business expense deduction as found in § 39A.03 in the definition of municipal taxable income, division (2) of this chapter, further reduced by any pre-2017 net operating loss carryforward equals municipal taxable income.
1. Income is defined in § 39A.03 of this chapter.
a. Qualifying wages is defined in § 39A.03.
b. Net profit is included in income, and is defined in § 39A.03 of this chapter. This section also provides that the net operating loss carryforward shall be calculated and deducted in the same manner as provided in § 39A.03 in the definition of adjusted federal taxable income, division (8). Treatment of net profits received by an individual taxpayer from rental real estate is provided in § 39A.06(B)(5).
c. Section 39A.03 in the definition of income, provides the following: offsetting and net operating loss carryforward treatment in division (1)(b)1. of the definition of income; resident's distributive share of net profit from pass through entity treatment in division (1)(b)2. of the definition of income; treatment of S Corporation distributive share of net profit in the hands of the shareholder in division (1)(c) of the definition of income; restriction of amount of loss permitted to be carried forward for use by taxpayer in a subsequent taxable year in division (1)(d) of the definition of income.
d. Pass through entity is defined in § 39A.03.
2. Exempt income is defined in § 39A.03 of this chapter.
3. Allowable employee business expense deduction is described in § 39A.03 in the definition of municipal taxable income, division (2) of this chapter, and is subject to the limitations provided in that section.
4. Pre-2017 net operating loss carryforward is defined in § 39A.03 of this chapter.
(2) (a) Municipal taxable income for a nonresident of the municipality is calculated as follows:
(b) Income reduced by exempt income to the extent such exempt income is otherwise included in income, as applicable, apportioned or sitused to the municipality as provided in § 39A.06(B) of this chapter, reduced by allowable employee business expense deduction as found in § 39A.03 in the definition of municipal taxable income, division (2) of this chapter, further reduced by any pre-2017 net operating loss carryforward equals municipal taxable income.
1. Income is defined in § 39A.03 of this chapter.
a. Qualifying wages is defined in § 39A.03.
b. Net profit is included in income, and is defined in § 39A.03 of this chapter. This section also provides that the net operating loss carryforward shall be calculated and deducted in the same manner as provided in § 39A.03 in the definition of adjusted federal taxable income, division (8). Net profit for a nonresident individual includes any net profit of the nonresident, but excludes the distributive share of net profit or loss of only pass through entity owned directly or indirectly by the nonresident.
c. Pass through entity is defined in § 39A.03.
2. Exempt income is defined in § 39A.03 of this chapter.
3. Apportioned or sitused to the municipality as provided in § 39A.06(B) of this chapter includes the apportionment of net profit income attributable to work done or services performed in the municipality. Treatment of net profits received by an individual taxpayer from rental real estate is provided in § 39A.06(B)(5).
4. Allowable employee business expense deduction as described in § 39A.03 in the definition of municipal taxable income, division (2) of this chapter, is subject to the limitations provided in that section. For a nonresident of the municipality, the deduction is limited to the extent the expenses are related to the performance of personal services by the nonresident in the municipality.
5. Pre-2017 net operating loss carryforward is defined in § 39A.03 of this chapter.
(B) Domicile.
(1) As used in this section:
(a) DOMICILE means the true, fixed and permanent home of the taxpayer to which whenever absent, the taxpayer intends to return.
(b) An individual is presumed to be domiciled in the municipality for all or part of a taxable year if the individual was domiciled in the municipality on the last day of the immediately preceding taxable year or if the Tax Administrator reasonably concludes that the individual is domiciled in the municipality for all or part of the taxable year.
(c) An individual may rebut the presumption of domicile described in division (A)(1)(a) of this section if the individual establishes by a preponderance of the evidence that the individual was not domiciled in the municipality for all or part of the taxable year.
(2) For the purpose of determining whether an individual is domiciled in the municipality for all or part of a taxable year, factors that may be considered include, but are not limited to, the following:
(a) The individual's domicile in other taxable years;
(b) The location at which the individual is registered to vote;
(c) The address on the individual's driver's license;
(d) The location of real estate for which the individual claimed a property tax exemption or reduction allowed on the basis of the individual's residence or domicile;
(e) The location and value of abodes owned or leased by the individual;
(f) Declarations, written or oral, made by the individual regarding the individual's residency;
(g) The primary location at which the individual is employed.
(h) The location of educational institutions attended by the individual's dependents as defined in § 152 of the Internal Revenue Code, to the extent that tuition paid to such educational institution is based on the residency of the individual or the individual's spouse in the municipal corporation or state where the educational institution is located;
(i) The number of contact periods the individual has with the municipality. For the purposes of this division, an individual has one "contact period" with the municipality if the individual is away overnight from the individual's abode located outside of the municipality and while away overnight from that abode spends at least some portion, however minimal, of each of 2 consecutive days in the municipality. For purposes of this section, the State's contact period test or bright-line test and resulting determination have no bearing on municipal residency or domicile.
(3) All applicable factors are provided in R.C. § 718.012.
(C) Exemption for member or employee of general assembly and certain judges.
(1) Only the municipal corporation of residence shall be permitted to levy a tax on the income of any member or employee of the Ohio General Assembly, including the Lieutenant Governor, whose income is received as a result of services rendered as such member or employee and is paid from appropriated funds of this state.
(2) Only the municipal corporation of residence and the city of Columbus shall levy a tax on the income of the Chief Justice or a Justice of the Supreme Court received as a result of services rendered as the Chief Justice or Justice. Only the municipal corporation of residence shall levy a tax on the income of a judge sitting by assignment of the Chief Justice or on the income of a district court of appeals judge sitting in multiple locations within the district, received as a result of services rendered as a judge.
(Ord. 15-09-027, passed 10-26-2015; Am. Ord. 15-12-038, passed 12-28-2015)
Statutory reference:
Member or employee of Ohio general assembly and certain judges excluded from tax, see R.C. 718.50