(a) As used in this chapter the following words shall have the meanings ascribed to them in this section, except as and if the context clearly indicates or requires a different meaning:
(1) “Adjusted federal taxable income” means a C corporation's federal taxable income before net operating losses and special deductions as determined under the Internal Revenue Code, adjusted as follows:
A. Deduct intangible income to the extent included in Federal taxable income. The deduction shall be allowed regardless of whether the intangible income relates to assets used in a trade or business or assets held for the production of income;
B. Add an amount equal to 5% of intangible income deducted under division (A)(1)A. this section, but excluding that portion of intangible income directly related to the sale, exchange, or other disposition of property described in Section 1221 of the Internal Revenue Code;
C. Add any losses allowed as a deduction in the computation of Federal taxable income if the losses directly relate to the sale, exchange, or other disposition of an asset described in Section 1221 or 1231 of the Internal Revenue Code;
D. 1. Except as provided in division (A)(1)D.2. of this section, deduct income and gain included in Federal taxable income to the extent the income and gain directly relate to the sale, exchange, or other disposition of an asset described in Section 1221 or 1231 of the Internal Revenue Code;
2. Division (A)(1)D.1. of this section does not apply to the extent the income or gain is income or gain described in Section 1245 or 1250 of the Internal Revenue Code.
E. Add taxes on or measured by net income allowed as a deduction in the computation of Federal taxable income;
F. In the case of a real estate investment trust and regulated investment company, add all amounts with respect to dividends to, distributions to, or amounts set aside for or credited to the benefit of investors and allowed as a deduction in the computation of Federal taxable income;
G. If the taxpayer is not a C corporation and is not an individual, the taxpayer shall compute adjusted Federal taxable income as if the taxpayer were a C corporation, except:
1. Guaranteed payments and other similar amounts paid or accrued to a partner, former partner, member, or former member shall not be allowed as a deductible expense; and
2. Amounts paid or accrued to a qualified self-employed retirement plan with respect to an owner or owner-employee of the taxpayer, amounts paid or accrued to or for health insurance for an owner or owner-employee, and amounts paid or accrued to or for life insurance for an owner or owner- employee shall not be allowed as a deduction.
Nothing in division (a)(1) of this section shall be construed as allowing the taxpayer to add or deduct any amount more than once or shall be construed as allowing any taxpayer to deduct any amount paid to or accrued for purposes of Federal self-employment tax.
Nothing in this chapter shall be construed as limiting or removing the ability of any municipal corporation to administer, audit, and enforce the provisions of its municipal income tax.
(2) “Association” means a partnership, limited partnership, S corporation or any other form of unincorporated enterprise, owned by one or more persons.
(3) “Board of Review” means the Board created by and constituted as provided for in Section 890.13.
(4) “Business” means an enterprise, venture, activity, profession or undertaking of any nature conducted for profit or ordinarily conducted for profit, whether by an individual, partnership, association, corporation or any other entity, including but not limited to the renting or leasing of property, real, personal or mixed.
(5) “Business allocation” means the portion of net profits to be allocated to Wapakoneta, Ohio, as having been made in the City, either under separate accounting method or under the three-factor formula of property, payroll and sales.
(6) “Calendar year” means an accounting period of 12 months or less ending on December 31.
(7) “City” means the City of Wapakoneta, Ohio.
(8) “Corporation” means a corporation or joint stock association organized under the laws of the United States, the State of Ohio, or any other state, territory, or foreign country or dependency.
(9) “Domicile” means a principal residence that the taxpayer intends to use for an indefinite time and to which, whenever he or she is absent, he or she intends to return. A taxpayer has only one domicile even though he or she may have more than one residence.
(10) “Employee” means one who works for wages, salary, commission or other types of compensation in the services of an employer. Any person upon whom an employer is required to withhold for either Federal income or social security or on whose account payments are made under the Ohio Bureau of Worker's Compensation law shall prima facie be an employee.
(11) “Employer” means an individual, partnership, association, corporation, (including a corporation not for profit), governmental body, unit or agency, or any other entity, whether or not organized for profit, who or that employs one or more persons on a salary, wage, commission or other compensation basis whether or not such employer is engaged in business.
(12) “Estimated tax liability” means the amount that a taxpayer estimates to be the taxpayer's liability for a municipal corporation's income tax for a year prior to applying any credits, estimated tax payments, or withheld taxes for the year.
(13) “Fiscal year” means an accounting period of 12 months or less ending on any day other than December 31. Only fiscal years accepted by the Internal Revenue Service for Federal income tax purposes may be used for City income tax purposes.
(14) “Form 2106" means Internal Revenue Service Form 2106 filed by a taxpayer pursuant to the Internal Revenue Code.
(15) “Generic form” means an electronic or paper form designed for reporting estimated municipal income taxes and annual municipal income tax liability, or for filing a refund claim that is not prescribed by a particular municipal corporation, for the reporting of that municipal corporation's tax on income. Any municipality that requires taxpayers to file income tax returns, reports, or other documents shall accept for filing a generic form of such a return, report, or document if the generic form, once completed and filed, contains all of the information required to be submitted with the municipality's prescribed returns, reports, or documents.
(16) “Gross receipts” means total income from any source whatsoever.
(17) “Income from a pass-through entity” means partnership income of partners, membership interests of members of a limited liability company, distributive shares of shareholders of an S corporation, or other distributive or proportionate ownership shares of income from other pass-through entities.
(18) “Intangible income” means income of any of the following types: income yield, interest, capital gains, dividends, or other income arising from the ownership, sale, exchange, or other disposition of intangible property including, but not limited to, investments, deposits, money, or credits as those terms are defined in Ohio R.C. Chapter 5701, and patents, copyrights, trademarks, trade names, investments in real estate investment trusts, investments in regulated investment companies, and appreciation on deferred compensation. “Intangible income” does not include prizes, awards, or other income associated with any lottery winnings or other similar games of chance.
(19) “Internal Revenue Code” means the Internal Revenue Code of 1986, 100 Stat. 2085, 26 U.S.C. 1, as amended.
(20) “Internet” means the international computer network of both Federal and non-Federal interoperable packet switched data networks, including the graphical sub network known as the World Wide Web.
(21) “Limited liability company” means a limited liability company formed under Ohio R.C. Chapter 1705 or under the laws of another state.
(22) “Municipality” means the City of Wapakoneta.
(23) “Net profit” for a taxpayer other than an individual means adjusted Federal taxable income, and “net profit” for a taxpayer who is an individual means the individual's profit, other than amounts described in Section 890.03(f), required to be reported on schedule C, schedule E, or schedule F.
(24) “Nonqualified deferred compensation plan” means a compensation plan described in Section 3121(v)(2)(C) of the Internal Revenue Code.
(25) “Nonresident” means an individual domiciled outside the Municipality.
(26) “Nonresident incorporated business entity” means an incorporated business entity not having an office or place of business within the Municipality.
(27) “Nonresident unincorporated business entity” means an unincorporated business entity not having an office or place of business within the Municipality.
(28) “Other entity” means any person or unincorporated body not previously named or defined, including inter alia, fiduciaries located within the City.
(29) “Other payer” means any person, other than an individual's employer or the employer's agent that pays an individual any amount included in the Federal gross income of the individual.
(30) “Owner” means a partner of a partnership, a member of a limited liability company, a shareholder of an S corporation, or other person with an ownership interest in a pass- through entity.
(31) “Owner's proportionate share”, with respect to each owner of a pass-through entity, means the ratio of (a) the owner's income from the pass-through entity that is subject to taxation by the municipal corporation, to (b) the total income from that entity of all owners whose income from the entity is subject to taxation by that municipal corporation.
(32) “Pass-through entity” means a partnership, limited liability company, S corporation, or any other class of entity, the income or profits from which are given pass-through treatment under the Internal Revenue Code.
(33) “Person” includes every natural person, partnership, fiduciary, association, corporation or other entity. Whenever used in any clause prescribing and imposing a penalty, the term “person” as applied to any unincorporated entity, shall mean the partners or members thereof, and as applied to corporations, the officers thereof, and in the case of any unincorporated entity or corporation not having any partner, member or officer within this Municipality, any employee or agent of such unincorporated entity or corporation who can be found within the corporate limits of the City.
(34) “Place of business” means any bona fide office, other than a mere statutory office, factory, warehouse, or other space, which is occupied and used by the taxpayer in carrying on any business activity, individually or through one or more of his regular employees regularly in attendance.
(35) “Principal place of business” means in the case of an employer having headquarters' activities at a place of business within a taxing municipality, the place of business at which the headquarters is situated. In the case of any employer not having its headquarters' activities at a place of business within a taxing municipality, the term means the largest place of business located in a taxing municipality.
(36) “Qualified plan” means a retirement plan satisfying the requirements under Section 401 of the Internal Revenue Code as amended.
(37) “Qualifying wages” means wages, as defined in Section 3121(a) of the Internal Revenue Code, without regard to any wage limitations, adjusted in accordance with Ohio R.C. 718.03(A).
(38) “Resident” means an individual domiciled in the Municipality.
(39) “Resident incorporated business entity” means an incorporated business entity having an office or place of business within the Municipality.
(40) “Resident unincorporated business entity” means an unincorporated business entity having an office or place of business within the Municipality.
(41) “Return preparer” means any person other than a taxpayer that is authorized by a taxpayer to complete or file an income tax return, report, or other document for or on behalf of the taxpayer.
(42) “S corporation” means a corporation that has made an election under Subchapter S of Chapter 1 of Subtitle A of the Internal Revenue Code for its taxable year.
(43) “Schedule C” means Internal Revenue Service schedule C filed by a taxpayer pursuant to the Internal Revenue Code.
(44) “Schedule E” means Internal Revenue Service schedule E filed by a taxpayer pursuant to the Internal Revenue Code.
(45) “Schedule F” means Internal Revenue Service schedule F filed by a taxpayer pursuant to the Internal Revenue Code.
(46) “Tax Administrator” means the person appointed to administer the Municipality's Income Tax Ordinance and to direct the operation of the Municipal Income Tax Department, or the person executing the duties of the Tax Administrator.
(47) “Taxable income” means:
A. Wages, salaries and other compensation paid by an employer or employers.
B. The net profits from the operation of a business, profession or other enterprise or activity adjusted in accordance with the provisions of this chapter.
C. Employee contributions to cost of fringe benefits as defined by Section 525 of the IRS code, as amended.
D. Sick pay received during taxable year.
E. Vacation pay received during taxable year.
F. Income from wage-continuation plans.
G. Premium cost paid by employer for an employee's group term life insurance with face amount of fifty thousand dollars ($50,000.00) or more.
H. Severance pay.
I. Tips.
J. Contributions made by employees to a tax-deferred annuity plan (i.e. 401(k)).
K. Disability pay if received as a benefit from employment (to include third party plans).
L. Bonuses.
M. Commissions.
N. Supplemental unemployment pay, which is paid by employer (SUB-pay).
O. All third party sick pay received by a resident or nonresident who receives such payments as a result of employment within the corporate limits of the City.
P. Business income (Federal Schedule C).
Q. Rental Income (Federal Schedule E, 4835) received by a person from real property within the City. “Real property” shall include commercial property, residential property, farm property, and any and all other types of real property.
R. Farm Income (Federal Schedule F).
S. The portion attributable to operations within the City of the net profits earned during the effective period of this chapter of all resident associations, corporate entities, unincorporated businesses, professions or other entities, derived from sales made, work done, rentals, services performed or rendered and business or other activities conducted in the City. The tax imposed on resident associations or other unincorporated entities owned by two or more individuals is upon the entities rather than the individual owners or members thereof. Losses from the operation of such activities, required to file as a separate entity, may not be used to offset wages, salaries, or other types of employee earnings or other compensation.
T. A resident partner or owner share of the net profits earned during the effective period of this chapter by a resident or unincorporated business not attributable to operations within the City and not levied against such entity.
U. The portion attributable to operations within the City of the net profits earned during the effective period of this chapter of all nonresident associations, corporate entities, unincorporated businesses, professions or other entities, derived from sales made, work done, rentals or services performed or rendered and business or other activities conducted in the City. The tax imposed on nonresident associations or other nonresident unincorporated entities owned by two or more persons is upon the entities rather than the individual owners or members thereof. Losses from the operation of such activities, required to file as a separate entity, may not be used to offset wages, salaries or other types of employees earnings or other compensation.
V. A nonresident partner or owner share of the net profits earned during the effective period of this chapter of a nonresident association or other unincorporated business not attributable to operations within the City and not levied against such association or other unincorporated entity.
W. The portion attributable to the City, of the net profits earned during the effective period of this chapter of all corporations derived from sales made, work done, rentals, services performed or rendered and business or other activities conducted in the City, whether or not such corporations have an office or place of business in the City.
X. All other compensation unless specifically exempted by this chapter.
(48) “Taxable year” means the corresponding tax-reporting period as prescribed for the taxpayer under the Internal Revenue Code.
(49) “Taxing municipality” means a municipality levying a tax on income earned by residents working within such municipality or on income earned by its residents.
(50) “Taxpayer” means a person, whether an individual, partnership, association or any corporation or other entity, required hereunder to file a return or pay a tax. “Taxpayer” does not include any person that is a disregarded entity or a qualifying subchapter S subsidiary for Federal income tax purposes, but “taxpayer” includes any other person who owns the disregarded entity or qualifying subchapter S subsidiary.
(51) “Third party sick pay” means payments received by an employee from either an individual, partnership, or corporation who or that has received a premium or other payment from the employer to insure that such payments be made to the employee for periods of time such employee was sick or on temporary disability and not physically working for the employer and the payments are to be considered either wages, salary, or other compensation and taxable under this chapter.
(b) The singular shall include the plural, the masculine shall include the feminine and the neuter, and all periods set forth shall be inclusive of the first and last mentioned dates.
(Ord. 2004-52. Passed 12-20-04.)