(a) All taxes imposed by this chapter shall be collectible, together with any interest and penalties thereon, by suit, as other debts of like amount are recoverable. An additional assessment shall not be made after three years from the time the return was due or filed, whichever is later. However, in the case of fraud, omission of 25% or more of income subject to this tax, or failure to file a return, all additional assessments shall be made and all prosecutions to recover municipal income taxes and penalties and interest thereon shall be brought within six years after the tax was due or the return was filed, whichever is later.
(b) In those cases in which the Commissioner of Internal Revenue and the taxpayer have executed a waiver of the Federal statute of limitations, the period within which an additional assessment may be made by the Administrator shall be one year from the time of the final determination of the Federal tax liability.
(c) Taxes erroneously paid shall not be refunded, unless a claim for refund is made within three years from the date upon which such payment was made or the return was due, or within three months after the final determination of the Federal tax liability, whichever is later. In addition, the following shall apply regarding refunds of tax withheld from non-qualified deferred compensation plans (NDCP):
(1) A taxpayer may be eligible for a refund if the taxpayer has suffered a loss from a NDCP. The loss will be considered sustained only in the taxable year in which the taxpayer receives the final distribution of money and property pursuant to the NDCP. Full loss is sustained if no distribution of money and property will be made by the NDCP.
(2) A taxpayer who receives income as a result of payments from a NDCP, and that income is less than the amount of income deferred to the NDCP and upon which municipal tax was withheld, then a refund will be issued on the amount representing the difference between the deferred income that was taxed and the income received from the NDCP. If different tax rates applied to the tax years in which deferrals, a weighted average of the different tax rates will be used to compute the refund amount.
(3) Refunds shall be allowed only if the loss is attributable to the bankruptcy of the employer who had established the NDCP, or the employee's failure or inability to satisfy all of the employer's terms and conditions necessary to receive the nonqualified compensation.
(d) Income tax that has been deposited with the Village, but should have been deposited with another municipality, is allowable by the Village a refund but is subject to the three-year limitation on refunds. Income tax that should have been deposited with the Village, but was deposited with another municipality, shall be subject to recovery by the Village. The Village will allow a non-refundable credit for any amount owed the Village that is in excess of the amount to be refunded by the other municipality, as long as the tax rate of the other Municipality is the same or higher than the Village’s tax rate. If the Village’s tax rate is higher, the tax representing the net difference of the rates is also subject to collection by the Village.
(e) Income tax that has been deposited with the Village, but should have been deposited with another municipality, is allowable by the Village as a refund but is subject to the three-year limitation on refunds. Income tax that should have been deposited with the Village, but was deposited with another municipality, shall be subject to recovery by the Village. The Village will allow a non-refundable credit for any amount owed the Village that is in excess of the amount to be refunded by the other municipality, as long as the tax rate of the other municipality is the same or higher than the Village’s tax rate. If the Village’s tax rate is higher, the tax representing the net difference of the rates is also subject to collection by the Village.
(f) Payments on delinquent amounts shall be applied in the following manner:
(1) To unpaid penalty and interest assessments in the order in which such assessments became due.
(2) To the taxes owed for any previous year in the order such taxes became due.
(3) To the taxpayer's current estimated tax liability.
(g) Amounts of less than one dollar ($1.00) shall not be collected or refunded.
(Ord. 2007-23. Passed 6-19-07.)