(A) (1) The credit, if any, provided to residents for municipal tax paid elsewhere on the same income taxable under West Alexandria’s ordinance is as stated in West Alexandria’s income tax ordinance.
(2) The credit allowed to resident individuals for the taxable net profits (if any), on business income for taxable years 2016 and later shall be calculated as follows:
(a) 1. Annual profits and losses from business activities owned by the taxpayer and earned in West Alexandria and/or outside of West Alexandria (collectively known as jurisdictions) shall be netted (i.e. offset) in order to calculate the resultant amount of current year taxable net profits to West Alexandria.
2. If West Alexandria provides a residence tax credit and the results of division (A)(2)(a) of this section produced a positive resultant amount of current year taxable net profits, then proceed to division (A)(2)(b) of this section to compute the allowable credit. If the result is negative, no credit is allowed under this section.
(b) 1. Add the current year business net profits from each jurisdiction that had taxable current year net profits. Do not include in this total a jurisdiction with current year business activities that resulted in a net loss for that jurisdiction.
2. If the taxpayer has multiple business activities in the current year within one jurisdiction, those business activity current year profits and losses must be offset to determine that jurisdiction’s resultant current year taxable business net profits, if any. If the offsetting results in positive taxable income, that jurisdiction is deemed to have taxable current year net profits. This offset calculation must be done for each jurisdiction in which the taxpayer has multiple business activities.
3. Each jurisdiction which has taxable current year net profits (either from a single business activity within the jurisdiction, or after application of division (A)(2)(b)2. of this section) shall divide that jurisdiction’s taxable current year net profits by the sum of all jurisdictions’ current year taxable net profits determined in divisions (A)(2)(b)1. and (A)(2)(b)2. of this section to determine that jurisdiction’s percentage of the total.
(c) The resultant amount of current year taxable net profits determined in division (A)(2)(a) of this section shall be multiplied by each jurisdiction’s percentage share calculated in division (A)(2)(b)2. of this section, and that result shall be multiplied by the respective jurisdiction’s tax rate, if any, to determine the amount of tax paid to that jurisdiction that may be eligible for credit from West Alexandria.
(d) West Alexandria shall then apply the credit rate (whether 100% or a reduced credit) and any credit limit, as stated in West Alexandria’s ordinance, to the amount calculated in division (A)(2)(c) of this section for each jurisdiction to determine the amount of credit West Alexandria shall allow for purposes of this section.
(B) West Alexandria shall grant a credit against its tax on income to a resident of West Alexandria who works in a joint economic development zone created under R.C. § 715.691 or a joint economic development district created under R.C. §§ 715.70, 715.71 or 715.72 to the same extent that it grants a credit against its tax on income to its residents who are employed in another municipal corporation.
(C) If the amount of tax withheld or paid to the other municipality is less than the amount of tax required to be withheld or paid to the other municipality, then for purposes of division (A) of this section, the income, qualifying wages, commissions, net profits or other compensation subject to tax in the other municipality shall be limited to the amount computed by dividing the tax withheld or paid to the other municipality by the tax rate for that municipality.
(D) Intentionally left blank. This indicates that West Alexandria does not give credit for county income taxes.
(Ord. 917, passed 7-19-2021)