It is the intent of this section that a taxpayer, subject to tax in more than one municipality on the same income, who has complied with the provisions hereof shall not be required by this chapter to pay the full tax rate in both municipalities, but to grant a partial credit for taxes paid by residents to other municipalities.
Accordingly, notwithstanding any other provisions of this chapter:
(a) Residents of the Municipality. When a resident of Waterville is subject to and has paid, or has acknowledged liability for, a municipal income tax in another municipality on the same income taxable under this chapter, and such other municipality does not allow a credit to its nonresidents, such Waterville residents may claim a credit for a portion of such tax paid to such other municipality, but not in excess of the tax assessed by this chapter.
(b) (1) When a resident of Waterville is subject to and has paid, or has acknowledged liability for, a municipal income tax in another municipality on the same income taxable under this chapter, a credit shall be allowed against Waterville income tax of 100% of the tax due; however, said credit shall not apply to the first .5% income tax rate levied in Waterville.
(2) If the tax due such other municipality has been paid to or withheld in such other municipality, a resident of Waterville may claim credit for and assign to Waterville any claim for refund to which he may be entitled from such other municipality. In the event an amount is not received by Waterville equal to such credit claimed by reason of tax payments made to or withheld in such other municipality, then the taxpayer shall be liable to Waterville for an amount by which the claimed credit exceeds the amount recovered on such assignment by Waterville, together with penalty and interest. If satisfactory evidence is offered, however, that the taxpayer is entitled to the claim covered by the assignment, such taxpayer shall not be deprived of credit therefore because of fault or neglect on the part of either municipality.
(3) Assignment of any claim for refund to which a Waterville resident may be entitled from another municipality shall be tentatively accepted as payment of that portion of Waterville income tax represented by such assignment, provided that an overpayment resulting from the credit allowed by reason of such assignment shall not be refunded until such assignment has been remitted to Waterville by such other municipality.
(c) Claim for Credits. The claim provided for in (b)(1) and (2) above will not be allowed unless the same are claimed in a timely return or form acceptable to and filed with the Commissioner. In the event a taxpayer fails, neglects, or refuses to file such timely return or form, he shall not be entitled to such credit and shall be liable for the full amount of tax assessed by this chapter, together with such interest and penalties, both civil and criminal, as are prescribed in this chapter.
(d) Filing Claims. Any claim for credit for income taxes paid another municipality on the same income tax hereunder, or claim for or assignment of any refund due to the credit provided for herein, must be filed with the Commissioner on or before December 31 of the year following that for which such credit is claimed; except that in case such claim for reciprocity refund has been assigned to the municipality of residence, such municipality of residence must file a claim for refund with the Commissioner on or before January 31 next following such December 31. Failure to file such claim for reciprocity credit or refund, or assignment thereof, within the time prescribed herein shall render such credit, claim for refund, or assignment null and void.
(e) The tax credit provided for in (b)(1) above shall apply to taxable income earned on and after July 1, 1977.
(f) No credit shall be given for any tax paid to a school district.
(Ord. 11-04. Passed 10-11-04.)