As used in this Chapter, the following words and phrases shall have the meanings indicated in this Section, unless the context clearly indicates or requires a different meaning. In all definitions and other Sections of this Chapter, the singular includes the plural and the masculine includes the feminine and the neuter.
(a) “Administrator” means the same as “Tax Administrator”. (See subsection (v) hereof.)
(b) “Association” means a partnership, limited partnership or any other form of unincorporated enterprise, owned by two or more persons.
(c) “Board of Review” means the board created and constituted as provided in Section 181.16.
(d) “Business” means an enterprise, activity, profession, public utility or public service, or undertaking of any nature conducted for profit or ordinarily conducted for profit, whether by an individual, partnership, limited partnership, association, corporation or other entity.
(e) “Corporation” means a corporation or joint stock association organized under the laws of the United States, the State of Ohio or other State, Territory, Foreign Country or Dependency.
(f) “Council” or “Village Council” shall refer to the Village Council of the Village of Windham, Ohio.
(g) “Declaration of Estimated Tax” means the document which must be filed pursuant to Section 181.10.
(h) “Employee” means one who works in the service of an employer, for wages, salary, commission or other compensation, which is subject to taxation under this Chapter.
(i) “Employer” means an individual, partnership, limited partnership, association, corporation, governmental body, unit or agency, or any other entity whether or not organized for profit, that employs one or more persons on a salary, wage, commission or other compensation basis.
(j) “Estimated Income” means the taxable income earned in a taxable year, the tax on which is not collected pursuant to Section 181.07.
(k) “Estimated Tax” means any tax which is imposed by this Chapter and which is not collected pursuant to Section 181.07.
(l) “Fiscal Year” means an accounting period of twelve months or less ending on any day other than December 31.
(m) “Gross Receipts” means the total income from any source whatsoever.
(n) “Net Profit or Net Profits” means the net gain from the operation of a business, profession or enterprise after provision for the cost and expense incurred in the conduct thereof, including reasonable allowance for depreciation, depletion, amortization and reasonable additions to reserve for bad debts, either paid or accrued in accordance with recognized principles of accounting applicable to the method of accounting regularly employed and without deduction of Federal Taxes based on income, and without deducting taxes imposed by this chapter.
In determining, “net profits”, the following considerations shall be included:
(1) Where necessary to properly reflect income, inventories must be used. The basis of pricing used for the purpose of the Federal Income Tax must in each instance be used.
(2) Where the books and records are kept on an “accrual basis”, “long-term contract basis”, or “installment basis”, and said basis is used in the filing of Federal Income Tax Returns, the same basis must be used for the purpose of this tax.
(3) If the return is made on a “cash basis”, Gross Profit shall include commissions, fees and interest earned, plus the gross profit or loss from the sales of merchandise, chattels, goods, wares, securities, notes, choses-in- action and services, except as hereinafter provided.
(4) If the return is made on an “accrual basis”, Gross Profit shall include commissions, fees and interest earned, plus the gross profit or loss from sales of merchandise, chattels, goods, wares, securities, notes, choses-in- action and services, except hereinafter provided.
(5) From Gross Profit there shall be subtracted allowable expense to arrive at the net profits subject to tax.
(6) All ordinary and necessary expense of doing business, including reasonable compensation paid employees, shall be allowed (but no deduction may be
claimed for “salary” or withdrawals of a proprietor or of the partners, members or other co-owners of an unincorporated business or enterprise).
(7) If not claimed as part of the Cost of Goods Sold or elsewhere in the return filed, there may be claimed and allowed a reasonable deduction for depreciation...depletion...obsolescence, losses resulting from theft or casualty not compensated for by insurance or otherwise, of property used in the trade or business, but the amount may not exceed that recognized for the purpose of the Federal Income Tax.
(8) Bad debts in a reasonable amount may be allowed in the year ascertained worthless and charged off, but in no event shall the amount allowed exceed the amount recognized as a deduction for the purpose of the Federal Income Tax.
(9) Only taxes directly connected with the taxpayer’s business may be claimed as a deduction. If for any reason the income from property is not subject to tax, then the tax on and other expenses of said property are not deductible. In any event, the following taxes are not deductible from income:
A. The tax under the chapter;
B. Any Federal taxes based upon income;
C. Gifts, estate or inheritance taxes; and
D. Taxes and/or special assessments for local benefits or improvements to property which tend to appreciate the value thereof.
(10) Capital gains and losses (including gains or losses from the sale, exchange, or other disposition of depreciable business property, and real property used in the taxpayer’s trade or business) shall not be taken into consideration in arriving at Net Profits Earned.
(11) If the taxpayer is a non-resident, only the amount of net profits applicable to the activities of the business in Windham shall be subject to tax. If the non-resident taxpayer’s records do not disclose the actual net profits for the Windham branch, office, store, or activity separately, then the basis of allocation shall be disclosed in the return. If such basis of allocation is not deemed correct, in view of all the known circumstances, the Fiscal Officer will make a reallocation based upon gross receipts or any other basis which shall, under the circumstances of the case, more accurately reflect the net profits.
(12) In general, all business expense recognized and to the extent allowed as such for the purpose of determining Federal Income Tax will be recognized and allowed for determining Windham Income Tax under the provisions of this chapter. However, all expense connected with the acquisition or carrying of securities, the income from which is not recognized as taxable under this chapter, may not be deducted in determining taxable net profits hereunder.
(13) In general, unearned income is not to be included in computing the tax levied hereunder. Income from intangibles by way of dividends interest and
the like, should not be included if the property from which such income is derived is subject to taxation under the Intangible Personal Property Tax Laws of the State of Ohio, or is specifically exempted from taxation under said laws.
(14) Rentals received by the taxpayer are to be included only if and to the extent that the rental, ownership, management, or operation of the real estate from which such rentals are derived (whether so rented, managed or operated by taxpayer individually or through agents or other representatives) constitutes a business activity of the taxpayer in whole or in part.
(15) Following are the circumstances under which, in any instance, the rental of any real property shall or shall not be deemed to be a “Business Activity”:
A. Where the gross monthly rental of any and all real properties, regardless of number and value, aggregates in excess of one hundred dollars ($100.00) per month, it shall be prima facie evidence that the rental, ownership, management or operation of such properties is a business activity of such taxpayer, and the net income of such rental property shall be subject to tax; provided that in case of commercial property, the owner shall be considered engaged in a business activity when the rental is based on a fixed or fluctuating percentage of gross or net sales, receipts or profits of the lessee, whether or not such rental exceeds one hundred dollars ($100.00) per month; provided further that in the case of farm property, the owner shall be considered engaged in a business activity when he shares in the crops or when the rental is based on a percentage of the gross or net receipts derived from the farms, whether or not the gross income exceeds one hundred dollars ($100.00) per month; and provided further that the person who operates a rooming house shall be considered in business whether or not the gross income exceeds one hundred dollars ($100.00) per month.
B. In determining the amount of gross monthly rental of any real property, periods during which (by reason of vacancy or any other cause) rentals are not received shall not be taken into consideration by the taxpayer.
C. Rentals received by a taxpayer engaged in the business of buying and selling real estate shall be considered as part of business income.
D. Real property, as the term is used in this regulation, shall include commercial property, residential property, farm property, and any and all other types of real estate.
E. In determining the taxable net income from rentals, the deductible expense shall be of the same nature, extent and amount as are allowed by the Department of Internal Revenue for Federal Income Tax Purposes.
F. Residents of Windham are subject to taxation upon the net income from rentals (to the extent above specified) regardless of the location of the real property owned.
G. Non-residents of Windham are subject to such taxation only if the real property is situated within the Village of Windham. Non- residents, in determining whether gross monthly rentals exceed one hundred dollars ($100.00) shall take into consideration only real estate situated within Windham Village.
(16) Income from royalties or copyrights is not to be included.
(o) “Non-resident” means an individual, partnership, limited partnership, corporation, association or other entity domiciled outside the Village of Windham.
(p) “Other entity” means any person or unincorporated body not previously named or defined and includes, inter alia, fiduciaries located within the Village of Windham.
(q) “Person” means every natural person, partnership, limited partnership, fiduciary, association or corporation. Whenever used in any clause prescribing and imposing a penalty, the term “person” as applied to any unincorporated entity or association means the partners or members thereof and as applied to corporations, the officers thereof.
(r) “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 whether individually or through one or more employees regularly in attendance.
A taxpayer does not have a regular place of business outside Windham solely by consigning goods to an independent factor or contractor outside the Village for sale.
(s) “Resident” means an individual, partnership, limited partnership, corporation, association or other entity domiciled in the Village of Windham.
(Ord. 1455. Passed 12-9-97.)
(t) “Taxable Income” means wages, salaries and other compensation, including vacation benefits, paid by an employer or employers before any deduction and/or the net profits from the operation of a business, profession or other enterprise or activity adjusted in accordance with the provisions of this Chapter. In addition, Taxable Income shall also include net gambling winnings, lottery winnings, or other proceeds from games of chance which are equal to or exceed fifty thousand dollars ($50,000). Gambling winnings, lottery winnings or other proceeds from games of chance which are equal to or in excess of the limit set forth herein are taxable, regardless of the source of the winnings.
(Ord. 2012-12. Passed 4-26-12.)
(u) “Taxable Year” means the calender year, or the fiscal year upon the basis of which the net profits are to be computed under this Chapter, and in the case of a return for a fractional part of a year, the period for which such return is required to be made.
(v) “Tax Administrator” means the Fiscal Officer of the Village of Windham or any individual acting on behalf and at the designation of the Fiscal Officer of the Village of Windham to administer this Chapter of Windham’s Code of Ordinances and the system of Income Taxation created by the Chapter of Windham’s Code of Ordinances.
(w) “Taxpayer” means a person, whether an individual, partnership, limited partnership, association, corporation, or other entity required by this Chapter to file a return and/or pay a tax.
(Ord. 1455. Passed 12-9-97.)
(Ord. 1455. Passed 12-9-97.)