As Reported by the Senate Ways and Means and Economic Development Committee

128th General Assembly
Regular Session
2009-2010
Sub. H. B. No. 75


Representatives Chandler, Moran 

Cosponsors: Representatives Harwood, Harris, Fende, Williams, B., Dodd, Ujvagi, Evans, Okey, Williams, S., Newcomb, Gardner, Yates, Luckie, Yuko, Phillips, Patten, Stewart, Stebelton, Huffman, Hagan, Domenick, Skindell, Koziura, Brown, Gerberry, Lundy, Mallory, Sayre, Belcher, Daniels, Adams, J., Grossman, Hall, Hite, Adams, R., Bacon, Baker, Balderson, Beck, Blair, Blessing, Boose, Bubp, Carney, Celeste, Combs, DeBose, DeGeeter, Derickson, Dyer, Foley, Garland, Garrison, Hackett, Hottinger, Lehner, Letson, Maag, Mandel, Martin, Mecklenborg, Oelslager, Pillich, Pryor, Sears, Slesnick, Snitchler, Uecker, Winburn, Zehringer 

Senators Schaffer, Schuring 

A BILL
To amend sections 5747.113, 5751.08, and 5751.09 and 1
to enact sections 149.308 and 5502.23 of the 2
Revised Code to allow taxpayers to contribute a 3
portion of their income tax refunds to the Ohio 4
Historical Society and the American Red Cross Ohio 5
Disaster Readiness and Preparedness Fund, to 6
permanently authorize the Tax Commissioner to 7
refund erroneously made commercial activity tax 8
payments made by persons not required to pay the 9
tax, and to expressly permit consensual extensions 10
of the four-year time limit on assessments and 11
refund requests for the commercial activity tax.12


BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

       Section 1. That sections 5747.113, 5751.08, and 5751.09 be 13
amended and sections 149.308 and 5502.23 of the Revised Code be 14
enacted to read as follows:15

       Sec. 149.308. There is hereby created in the state treasury 16
the Ohio historical society income tax contribution fund, which 17
shall consist of money contributed to it under section 5747.113 of 18
the Revised Code and of contributions made directly to it. Any 19
person may contribute directly to the fund in addition to or 20
independently of the income tax refund contribution system 21
established in section 5747.113 of the Revised Code.22

        The Ohio historical society shall use money credited to the 23
fund in furtherance of the public functions with which the society 24
is charged under section 149.30 of the Revised Code.25

       Sec. 5502.23.  (A) There is hereby created in the state 26
treasury the American red cross Ohio disaster response readiness 27
and preparedness fund, which shall consist of money transferred to 28
it under section 5747.113 of the Revised Code and of contributions 29
made directly to it. Any person may contribute directly to the 30
fund in addition to or independently of the income tax 31
contribution system established in section 5747.113 of the Revised 32
Code.33

       (B) Each year, the executive director of the state emergency 34
management agency created under section 5502.22 of the Revised 35
Code shall make one or more grants to the American red cross 36
greater Columbus chapter from money appropriated for that purpose 37
from the American red cross Ohio disaster response readiness and 38
preparedness fund, to be used by the American red cross chapters 39
in Ohio for planning, for the implementation of programs to assist 40
in disaster preparedness and response throughout this state, and 41
for the costs of administering those programs. The American red 42
cross greater Columbus chapter, on behalf of American red cross 43
chapters in Ohio, shall submit to the executive director its plan 44
for the use of any grants received under this section within sixty 45
days after the effective date of any section of law appropriating 46
money from the fund for the purpose of such grants.47

       (C) If the American red cross greater Columbus chapter ceases 48
to exist, the executive director shall use money in the American 49
red cross Ohio disaster response readiness and preparedness fund 50
to make grants to the American red cross to be used for disaster 51
preparedness, response, and planning throughout this state.52

       Sec. 5747.113. (A)(1) Any taxpayer claiming a refund under 53
section 5747.11 of the Revised Code for taxable years ending on or 54
after October 14, 1983, who wishes to contribute any part of the 55
taxpayer's refund to the natural areas and preserves fund created 56
in section 1517.11 of the Revised Code, the nongame and endangered 57
wildlife fund created in section 1531.26 of the Revised Code, the 58
military injury relief fund created in section 5101.98 of the 59
Revised Code, the Ohio historical society income tax contribution 60
fund created in section 149.308 of the Revised Code, or all of 61
those funds, may designate on the taxpayer's income tax return the 62
amount that the taxpayer wishes to contribute to the fund or 63
funds. A64

       (2) For taxable years beginning in 2010 or thereafter, a 65
taxpayer who wishes to contribute to the American red cross Ohio 66
disaster response readiness and preparedness fund created in 67
section 5502.23 of the Revised Code may do so by contributing any 68
part of the taxpayer's refund. A taxpayer shall designate on the 69
taxpayer's income tax return the amount the taxpayer wishes to 70
contribute to the fund, provided that the amount contributed shall 71
be at least one dollar. In no case shall a contribution under this 72
division operate to reduce the combined amount of the state and 73
school district income taxes shown to be due on a taxpayer's 74
annual return.75

       (3) A designated contribution of any part of a refund is 76
irrevocable upon the filing of the return and shall be made in the 77
full amount designated if the refund found due the taxpayer upon 78
the initial processing of the taxpayer's return, after any 79
deductions including those required by section 5747.12 of the 80
Revised Code, is greater than or equal to the designated 81
contribution. If the refund due as initially determined is less 82
than the designated contribution, the contribution shall be made 83
in the full amount of the refund. The tax commissioner shall 84
subtract the amount of the contribution from the amount of the 85
refund initially found due the taxpayer and shall certify the 86
difference to the director of budget and management and treasurer 87
of state for payment to the taxpayer in accordance with section 88
5747.11 of the Revised Code. For the purpose of any subsequent 89
determination of the taxpayer's net tax payment, the contribution 90
shall be considered a part of the refund paid to the taxpayer.91

       (B) The tax commissioner shall provide a space on the income 92
tax return form in which a taxpayer may indicate that the taxpayer 93
wishes to make a donation in accordance with this section. The tax 94
commissioner shall also print in the instructions accompanying the 95
income tax return form a description of the purposes for which the 96
natural areas and preserves fund, the nongame and endangered 97
wildlife fund, and the military injury relief fund, the American 98
red cross Ohio disaster response readiness and preparedness fund, 99
and the Ohio historical society income tax contribution fund were 100
created and the use of moneys from the income tax refund 101
contribution system established in this section. No person shall 102
designate on the person's income tax return any part of a refund 103
claimed under section 5747.11 of the Revised Code as a 104
contribution to any fund other than the natural areas and 105
preserves fund, the nongame and endangered wildlife fund, the 106
military injury relief fund, the American red cross Ohio disaster 107
response readiness and preparedness fund, or all of those funds108
the Ohio historical society income tax contribution fund.109

       (C) The money collected under the income tax refund 110
contribution system established in this section shall be deposited 111
by the tax commissioner into the natural areas and preserves fund, 112
the nongame and endangered wildlife fund, and the military injury 113
relief fund, the American red cross Ohio disaster response 114
readiness and preparedness fund, and the Ohio historical society 115
income tax contribution fund in the amounts designated on the tax 116
returns.117

       (D) No later than the thirtieth day of September each year, 118
the tax commissioner shall determine the total amount contributed 119
to each fund under this section during the preceding eight months, 120
any adjustments to prior months, and the cost to the department of 121
taxation of administering the income tax refund contribution 122
system during that eight-month period. The commissioner shall make 123
an additional determination no later than the thirty-first day of 124
January of each year of the total amount contributed to each fund 125
under this section during the preceding four calendar months, any 126
adjustments to prior years made during that four-month period, and 127
the cost to the department of taxation of administering the income 128
tax contribution system during that period. The cost of 129
administering the income tax contribution system shall be 130
certified by the tax commissioner to the director of budget and 131
management, who shall transfer an amount equal to one-third132
one-fifth of such administrative costs from the natural areas and 133
preserves fund, one-third of such costs from the nongame and 134
endangered wildlife fund, and one-third of such costs from the 135
military injury relief fundeach of the five funds to the litter 136
control and natural resource tax administrationincome tax refund 137
contribution fund, which is hereby created, provided that the 138
moneys that the department receives to pay the cost of 139
administering the income tax refund contribution system in any 140
year shall not exceed two and one-half per cent of the total 141
amount contributed under that system during that year.142

       (E)(1) The director of natural resources, in January of every 143
odd-numbered year, shall report to the general assembly on the 144
effectiveness of the income tax refund contribution system as it 145
pertains to the natural areas and preserves fund and the nongame 146
and endangered wildlife fund. The report shall include the amount 147
of money contributed to each fund in each of the previous five 148
years, the amount of money contributed directly to each fund in 149
addition to or independently of the income tax refund contribution 150
system in each of the previous five years, and the purposes for 151
which the money was expended.152

       (2) The director of job and family services and the director 153
of the Ohio historical society, in January of every odd-numbered 154
year, each shall report to the general assembly on the 155
effectiveness of the income tax refund contribution system as it 156
pertains to the military injury relief fund and the Ohio 157
historical society income tax contribution fund, respectively. The 158
report shall include the amount of money contributed to the fund 159
in each of the previous five years, the amount of money 160
contributed directly to the fund in addition to or independently 161
of the income tax refund contribution system in each of the 162
previous five years, and the purposes for which the money was 163
expended164

       (3) In January of every odd-numbered year, beginning January 165
2012, the executive director of the state emergency management 166
agency created under section 5502.22 of the Revised Code shall 167
report to the general assembly on the effectiveness of the income 168
tax refund contribution system as it pertains to the American red 169
cross Ohio disaster response readiness and preparedness fund.170

       (4) Each report made under division (E) of this section also 171
shall include the amount of money contributed to each fund in each 172
of the previous five years, the amount of money contributed 173
directly to each fund in addition to or independently of the 174
income tax refund contribution system in each of the previous five 175
years, and the purposes for which the money in each fund was 176
expended.177

       Sec. 5751.08.  (A) An application for refund to the taxpayer 178
of the amount of taxes imposed under this chapter that are 179
overpaid, paid illegally or erroneously, or paid on any illegal or 180
erroneous assessment shall be filed by the reporting person with 181
the tax commissioner, on the form prescribed by the commissioner, 182
within four years after the date of the illegal or erroneous 183
payment of the tax, or within any additional period allowed under 184
division (F) of section 5751.09 of the Revised Code. The applicant 185
shall provide the amount of the requested refund along with the 186
claimed reasons for, and documentation to support, the issuance of 187
a refund.188

       (B) On the filing of the refund application, the tax 189
commissioner shall determine the amount of refund to which the 190
applicant is entitled. If the amount is not less than that 191
claimed, the commissioner shall certify the amount to the director 192
of budget and management and treasurer of state for payment from 193
the tax refund fund created under section 5703.052 of the Revised 194
Code. If the amount is less than that claimed, the commissioner 195
shall proceed in accordance with section 5703.70 of the Revised 196
Code.197

       (C) Interest on a refund applied for under this section, 198
computed at the rate provided for in section 5703.47 of the 199
Revised Code, shall be allowed from the later of the date the tax 200
was paid or when the tax payment was due.201

       (D) A calendar quarter taxpayer with more than one million 202
dollars in taxable gross receipts in a calendar year other than 203
calendar year 2005 and that is not able to exclude one million 204
dollars in taxable gross receipts because of the operation of the 205
taxpayer's business in that calendar year may file for a refund 206
under this section to obtain the full exclusion of one million 207
dollars in taxable gross receipts for that calendar year.208

       (E) No person with an active registration as a taxpayer under 209
this chapter may claim a refund under this section for the tax 210
imposed under division (B) of section 5751.03 of the Revised Code 211
unless the person cancelled the registration before the tenth day 212
of May of the current calendar year pursuant to division (D) of 213
section 5751.04 of the Revised Code.214

       (F) Except as provided in section 5751.0915751.081 of the 215
Revised Code, the tax commissioner may, with the consent of the 216
taxpayer, provide for the crediting against tax due for a tax year 217
the amount of any refund due the taxpayer under this chapter for a 218
preceding tax year.219

       Sec. 5751.09.  (A) The tax commissioner may make an 220
assessment, based on any information in the commissioner's 221
possession, against any person that fails to file a return or pay 222
any tax as required by this chapter. The commissioner shall give 223
the person assessed written notice of the assessment as provided 224
in section 5703.37 of the Revised Code. With the notice, the 225
commissioner shall provide instructions on the manner in which to 226
petition for reassessment and request a hearing with respect to 227
the petition. The commissioner shall send any assessments against 228
consolidated elected taxpayer and combined taxpayer groups under 229
section 5751.011 or 5751.012 of the Revised Code to the taxpayer's 230
"reporting person" as defined under division (R) of section 231
5751.01 of the Revised Code. The reporting person shall notify all 232
members of the group of the assessment and all outstanding taxes, 233
interest, and penalties for which the assessment is issued.234

       (B) Unless the person assessed, within sixty days after 235
service of the notice of assessment, files with the tax 236
commissioner, either personally or by certified mail, a written 237
petition signed by the person or the person's authorized agent 238
having knowledge of the facts, the assessment becomes final, and 239
the amount of the assessment is due and payable from the person 240
assessed to the treasurer of state. The petition shall indicate 241
the objections of the person assessed, but additional objections 242
may be raised in writing if received by the commissioner prior to 243
the date shown on the final determination.244

       If a petition for reassessment has been properly filed, the 245
commissioner shall proceed under section 5703.60 of the Revised 246
Code.247

       (C)(1) After an assessment becomes final, if any portion of 248
the assessment, including accrued interest, remains unpaid, a 249
certified copy of the tax commissioner's entry making the 250
assessment final may be filed in the office of the clerk of the 251
court of common pleas in the county in which the person resides or 252
has its principal place of business in this state, or in the 253
office of the clerk of court of common pleas of Franklin county.254

       (2) Immediately upon the filing of the entry, the clerk shall 255
enter judgment for the state against the person assessed in the 256
amount shown on the entry. The judgment may be filed by the clerk 257
in a loose-leaf book entitled, "special judgments for the 258
commercial activity tax" and shall have the same effect as other 259
judgments. Execution shall issue upon the judgment at the request 260
of the tax commissioner, and all laws applicable to sales on 261
execution shall apply to sales made under the judgment.262

       (3) The portion of the assessment not paid within sixty days 263
after the day the assessment was issued shall bear interest at the 264
rate per annum prescribed by section 5703.47 of the Revised Code 265
from the day the tax commissioner issues the assessment until it 266
is paid. Interest shall be paid in the same manner as the tax and 267
may be collected by the issuance of an assessment under this 268
section.269

       (D) If the tax commissioner believes that collection of the 270
tax will be jeopardized unless proceedings to collect or secure 271
collection of the tax are instituted without delay, the 272
commissioner may issue a jeopardy assessment against the person 273
liable for the tax. Immediately upon the issuance of the jeopardy 274
assessment, the commissioner shall file an entry with the clerk of 275
the court of common pleas in the manner prescribed by division (C) 276
of this section. Notice of the jeopardy assessment shall be served 277
on the person assessed or the person's authorized agent in the 278
manner provided in section 5703.37 of the Revised Code within five 279
days of the filing of the entry with the clerk. The total amount 280
assessed is immediately due and payable, unless the person 281
assessed files a petition for reassessment in accordance with 282
division (B) of this section and provides security in a form 283
satisfactory to the commissioner and in an amount sufficient to 284
satisfy the unpaid balance of the assessment. Full or partial 285
payment of the assessment does not prejudice the commissioner's 286
consideration of the petition for reassessment.287

       (E) The tax commissioner shall immediately forward to the 288
treasurer of state all amounts the commissioner receives under 289
this section, and such amounts shall be considered as revenue 290
arising from the tax imposed under this chapter.291

       (F) Except as otherwise provided in this division, no 292
assessment shall be made or issued against a taxpayer for the tax 293
imposed under this chapter more than four years after the due date 294
for the filing of the return for the tax period for which the tax 295
was reported, or more than four years after the return for the tax 296
period was filed, whichever is later. The time limit may be 297
extended if both the taxpayer and the commissioner consent in 298
writing to the extension or enter into an agreement waiving or 299
extending the time limit. Any such extension shall extend the 300
four-year time limit in division (B) of section 5751.08 of the 301
Revised Code for the same period of time. Nothing in this division 302
bars an assessment against a taxpayer that fails to file a return 303
required by this chapter or that files a fraudulent return.304

       (G) If the tax commissioner possesses information that 305
indicates that the amount of tax a taxpayer is required to pay 306
under this chapter exceeds the amount the taxpayer paid, the tax 307
commissioner may audit a sample of the taxpayer's gross receipts 308
over a representative period of time to ascertain the amount of 309
tax due, and may issue an assessment based on the audit. The tax 310
commissioner shall make a good faith effort to reach agreement 311
with the taxpayer in selecting a representative sample. The tax 312
commissioner may apply a sampling method only if the commissioner 313
has prescribed the method by rule.314

       (H) If the whereabouts of a person subject to this chapter is 315
not known to the tax commissioner, the commissioner shall follow 316
the procedures under section 5703.37 of the Revised Code.317

       Section 2. That existing sections 5747.113, 5751.08, and 318
5751.09 of the Revised Code are hereby repealed.319

       Section 3. The amendment by this act of section 5747.113 of 320
the Revised Code applies to taxable years beginning on or after 321
January 1, 2010.322

       Section 4. A person may request a refund of the annual 323
minimum commercial activity tax paid for calendar year 2007, 2008, 324
or 2009 under Chapter 5751. of the Revised Code if the person 325
satisfies both of the following:326

       (A) The person was not subject to the tax for 2007, 2008, or 327
2009 because the person was an excluded person under division 328
(E)(1) of section 5751.01 of the Revised Code.329

       (B) The person erroneously registered for the tax and failed 330
to cancel the registration before the tenth day of February of the 331
calendar year for which the tax was paid.332