As Reported by the House Ways and Means Committee

130th General Assembly
Regular Session
2013-2014
Sub. H. B. No. 5


Representatives Grossman, Henne 

Cosponsors: Representatives Amstutz, Beck 

A BILL
To amend sections 709.023, 718.02, 718.03, 718.051, 1
718.07, 718.09, 718.10, 718.11, 718.121, 718.13, 2
5703.059, 5703.57, 5717.011, 5717.03, 5739.12, 3
5739.124, 5741.122, 5747.063, 5747.064, 5747.50, 4
and 5751.07, to amend, for the purpose of adopting 5
a new section number as indicated in parentheses, 6
section 718.04 (718.50), to enact new sections 7
718.01, 718.011, 718.04, 718.05, 718.06, 718.08, 8
and 718.12 and sections 718.012, 718.031, 718.052, 9
718.18, 718.19, 718.22 to 718.28, 718.30, 718.31, 10
718.35, 718.38, 718.41, and 718.99, to repeal 11
sections 718.01, 718.011, 718.041, 718.05, 718.06, 12
718.08, 718.12, and 718.14 of the Revised Code, 13
and to amend the version of section 5703.02 of the 14
Revised Code that is scheduled to take effect 15
January 1, 2015, to revise the laws governing 16
income taxes imposed by municipal corporations.17


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

       Section 1.  That sections 709.023, 718.02, 718.03, 718.051, 18
718.07, 718.09, 718.10, 718.11, 718.121, 718.13, 5703.059, 19
5703.57, 5717.011, 5717.03, 5739.12, 5739.124, 5741.122, 5747.063, 20
5747.064, 5747.50, and 5751.07 be amended, section 718.04 (718.50) 21
be amended for the purpose of adopting a new section number as 22
indicated in parentheses, and new sections 718.01, 718.011, 23
718.04, 718.05, 718.06, 718.08, and 718.12 and sections 718.012, 24
718.031, 718.052, 718.18, 718.19, 718.22, 718.23, 718.24, 718.25, 25
718.26, 718.27, 718.28, 718.30, 718.31, 718.35, 718.38, 718.41, 26
and 718.99 of the Revised Code be enacted to read as follows:27

       Sec. 709.023. (A) A petition filed under section 709.021 of 28
the Revised Code that requests to follow this section is for the 29
special procedure of annexing land into a municipal corporation 30
when, subject to division (H) of this section, the land also is 31
not to be excluded from the township under section 503.07 of the 32
Revised Code. The owners who sign this petition by their signature 33
expressly waive their right to appeal in law or equity from the 34
board of county commissioners' entry of any resolution under this 35
section, waive any rights they may have to sue on any issue 36
relating to a municipal corporation requiring a buffer as provided 37
in this section, and waive any rights to seek a variance that 38
would relieve or exempt them from that buffer requirement.39

       The petition circulated to collect signatures for the special 40
procedure in this section shall contain in boldface capital 41
letters immediately above the heading of the place for signatures 42
on each part of the petition the following: "WHOEVER SIGNS THIS 43
PETITION EXPRESSLY WAIVES THEIR RIGHT TO APPEAL IN LAW OR EQUITY 44
FROM THE BOARD OF COUNTY COMMISSIONERS' ENTRY OF ANY RESOLUTION 45
PERTAINING TO THIS SPECIAL ANNEXATION PROCEDURE, ALTHOUGH A WRIT 46
OF MANDAMUS MAY BE SOUGHT TO COMPEL THE BOARD TO PERFORM ITS 47
DUTIES REQUIRED BY LAW FOR THIS SPECIAL ANNEXATION PROCEDURE."48

       (B) Upon the filing of the petition in the office of the 49
clerk of the board of county commissioners, the clerk shall cause 50
the petition to be entered upon the board's journal at its next 51
regular session. This entry shall be the first official act of the 52
board on the petition. Within five days after the filing of the 53
petition, the agent for the petitioners shall notify in the manner 54
and form specified in this division the clerk of the legislative 55
authority of the municipal corporation to which annexation is 56
proposed, the fiscal officer of each township any portion of which 57
is included within the territory proposed for annexation, the 58
clerk of the board of county commissioners of each county in which 59
the territory proposed for annexation is located other than the 60
county in which the petition is filed, and the owners of property 61
adjacent to the territory proposed for annexation or adjacent to a 62
road that is adjacent to that territory and located directly 63
across that road from that territory. The notice shall refer to 64
the time and date when the petition was filed and the county in 65
which it was filed and shall have attached or shall be accompanied 66
by a copy of the petition and any attachments or documents 67
accompanying the petition as filed.68

       Notice to a property owner is sufficient if sent by regular 69
United States mail to the tax mailing address listed on the county 70
auditor's records. Notice to the appropriate government officer 71
shall be given by certified mail, return receipt requested, or by 72
causing the notice to be personally served on the officer, with 73
proof of service by affidavit of the person who delivered the 74
notice. Proof of service of the notice on each appropriate 75
government officer shall be filed with the board of county 76
commissioners with which the petition was filed.77

       (C) Within twenty days after the date that the petition is 78
filed, the legislative authority of the municipal corporation to 79
which annexation is proposed shall adopt an ordinance or 80
resolution stating what services the municipal corporation will 81
provide, and an approximate date by which it will provide them, to 82
the territory proposed for annexation, upon annexation. The 83
municipal corporation is entitled in its sole discretion to 84
provide to the territory proposed for annexation, upon annexation, 85
services in addition to the services described in that ordinance 86
or resolution.87

       If the territory proposed for annexation is subject to zoning 88
regulations adopted under either Chapter 303. or 519. of the 89
Revised Code at the time the petition is filed, the legislative 90
authority of the municipal corporation also shall adopt an 91
ordinance or resolution stating that, if the territory is annexed 92
and becomes subject to zoning by the municipal corporation and 93
that municipal zoning permits uses in the annexed territory that 94
the municipal corporation determines are clearly incompatible with 95
the uses permitted under current county or township zoning 96
regulations in the adjacent land remaining within the township 97
from which the territory was annexed, the legislative authority of 98
the municipal corporation will require, in the zoning ordinance 99
permitting the incompatible uses, the owner of the annexed 100
territory to provide a buffer separating the use of the annexed 101
territory and the adjacent land remaining within the township. For 102
the purposes of this section, "buffer" includes open space, 103
landscaping, fences, walls, and other structured elements; streets 104
and street rights-of-way; and bicycle and pedestrian paths and 105
sidewalks.106

       The clerk of the legislative authority of the municipal 107
corporation to which annexation is proposed shall file the 108
ordinances or resolutions adopted under this division with the 109
board of county commissioners within twenty days following the 110
date that the petition is filed. The board shall make these 111
ordinances or resolutions available for public inspection.112

       (D) Within twenty-five days after the date that the petition 113
is filed, the legislative authority of the municipal corporation 114
to which annexation is proposed and each township any portion of 115
which is included within the territory proposed for annexation may 116
adopt and file with the board of county commissioners an ordinance 117
or resolution consenting or objecting to the proposed annexation. 118
An objection to the proposed annexation shall be based solely upon 119
the petition's failure to meet the conditions specified in 120
division (E) of this section.121

       If the municipal corporation and each of those townships 122
timely files an ordinance or resolution consenting to the proposed 123
annexation, the board at its next regular session shall enter upon 124
its journal a resolution granting the proposed annexation. If, 125
instead, the municipal corporation or any of those townships files 126
an ordinance or resolution that objects to the proposed 127
annexation, the board of county commissioners shall proceed as 128
provided in division (E) of this section. Failure of the municipal 129
corporation or any of those townships to timely file an ordinance 130
or resolution consenting or objecting to the proposed annexation 131
shall be deemed to constitute consent by that municipal 132
corporation or township to the proposed annexation.133

       (E) Unless the petition is granted under division (D) of this 134
section, not less than thirty or more than forty-five days after 135
the date that the petition is filed, the board of county 136
commissioners shall review it to determine if each of the 137
following conditions has been met:138

       (1) The petition meets all the requirements set forth in, and 139
was filed in the manner provided in, section 709.021 of the 140
Revised Code.141

       (2) The persons who signed the petition are owners of the 142
real estate located in the territory proposed for annexation and 143
constitute all of the owners of real estate in that territory.144

       (3) The territory proposed for annexation does not exceed 145
five hundred acres.146

       (4) The territory proposed for annexation shares a contiguous 147
boundary with the municipal corporation to which annexation is 148
proposed for a continuous length of at least five per cent of the 149
perimeter of the territory proposed for annexation.150

       (5) The annexation will not create an unincorporated area of 151
the township that is completely surrounded by the territory 152
proposed for annexation.153

       (6) The municipal corporation to which annexation is proposed 154
has agreed to provide to the territory proposed for annexation the 155
services specified in the relevant ordinance or resolution adopted 156
under division (C) of this section.157

       (7) If a street or highway will be divided or segmented by 158
the boundary line between the township and the municipal 159
corporation as to create a road maintenance problem, the municipal 160
corporation to which annexation is proposed has agreed as a 161
condition of the annexation to assume the maintenance of that 162
street or highway or to otherwise correct the problem. As used in 163
this section, "street" or "highway" has the same meaning as in 164
section 4511.01 of the Revised Code.165

       (F) Not less than thirty or more than forty-five days after 166
the date that the petition is filed, if the petition is not 167
granted under division (D) of this section, the board of county 168
commissioners, if it finds that each of the conditions specified 169
in division (E) of this section has been met, shall enter upon its 170
journal a resolution granting the annexation. If the board of 171
county commissioners finds that one or more of the conditions 172
specified in division (E) of this section have not been met, it 173
shall enter upon its journal a resolution that states which of 174
those conditions the board finds have not been met and that denies 175
the petition.176

       (G) If a petition is granted under division (D) or (F) of 177
this section, the clerk of the board of county commissioners shall 178
proceed as provided in division (C)(1) of section 709.033 of the 179
Revised Code, except that no recording or hearing exhibits would 180
be involved. There is no appeal in law or equity from the board's 181
entry of any resolution under this section, but any party may seek 182
a writ of mandamus to compel the board of county commissioners to 183
perform its duties under this section.184

       (H) Notwithstanding anything to the contrary in section 185
503.07 of the Revised Code, unless otherwise provided in an 186
annexation agreement entered into pursuant to section 709.192 of 187
the Revised Code or in a cooperative economic development 188
agreement entered into pursuant to section 701.07 of the Revised 189
Code, territory annexed into a municipal corporation pursuant to 190
this section shall not at any time be excluded from the township 191
under section 503.07 of the Revised Code and, thus, remains 192
subject to the township's real property taxes.193

       (I) Any owner of land that remains within a township and that 194
is adjacent to territory annexed pursuant to this section who is 195
directly affected by the failure of the annexing municipal 196
corporation to enforce compliance with any zoning ordinance it 197
adopts under division (C) of this section requiring the owner of 198
the annexed territory to provide a buffer zone, may commence in 199
the court of common pleas a civil action against that owner to 200
enforce compliance with that buffer requirement whenever the 201
required buffer is not in place before any development of the 202
annexed territory begins.203

       (J) Division (H)(12) of section 718.01 of the Revised Code 204
applies to the compensation paid to persons performing personal 205
services for a political subdivision on property owned by the 206
political subdivision after that property is annexed to a 207
municipal corporation under this section.208

       Sec. 718.01.  Any term used in this chapter that is not 209
otherwise defined in this chapter has the same meaning as when 210
used in a comparable context in laws of the United States relating 211
to federal income taxation or in Title LVII of the Revised Code, 212
unless a different meaning is clearly required. If a term used in 213
this chapter that is not otherwise defined in this chapter is used 214
in a comparable context in both the laws of the United States 215
relating to federal income tax and in Title LVII of the Revised 216
Code and the use is not consistent, then the use of the term in 217
the laws of the United States relating to federal income tax shall 218
control over the use of the term in Title LVII of the Revised 219
Code. 220

        As used in this chapter:221

       (A)(1) "Municipal taxable income" means the following:222

       (a) For a person other than an individual, income reduced by 223
exempt income to the extent otherwise included in income and then, 224
as applicable, apportioned or sitused to the municipal corporation 225
under section 718.02 of the Revised Code, and further reduced by 226
any pre-2016 net operating loss carryforward available to the 227
person for the municipal corporation.228

       (b)(i) For an individual who is a resident of a municipal 229
corporation other than a qualified municipal corporation, income 230
reduced by exempt income to the extent otherwise included in 231
income, then reduced as provided in division (A)(2) of this 232
section, and further reduced by any pre-2016 net operating loss 233
carryforward available to the individual for the municipal 234
corporation.235

       (ii) For an individual who is a resident of a qualified 236
municipal corporation, Ohio adjusted gross income reduced by 237
income exempted, and increased by deductions excluded, by the 238
qualified municipal corporation from the qualified municipal 239
corporation's tax on or before December 31, 2013. If a qualified 240
municipal corporation, on or before December 31, 2013, exempts 241
income earned by individuals who are not residents of the 242
qualified municipal corporation and net profit of persons that are 243
not wholly located within the qualified municipal corporation, 244
such individual or person shall have no municipal taxable income 245
for the purposes of the tax levied by the qualified municipal 246
corporation and may be exempted by the qualified municipal 247
corporation from the requirements of section 718.03 of the Revised 248
Code.249

       (c) For an individual who is a nonresident of a municipal 250
corporation, income reduced by exempt income to the extent 251
otherwise included in income and then, as applicable, apportioned 252
or sitused to the municipal corporation under section 718.02 of 253
the Revised Code, then reduced as provided in division (A)(2) of 254
this section, and further reduced by any pre-2016 net operating 255
loss carryforward available to the individual for the municipal 256
corporation.257

       (2) In computing the municipal taxable income of a taxpayer 258
who is an individual, the taxpayer may subtract, as provided in 259
division (A)(1)(b)(i) or (c) of this section, the amount of the 260
individual's employee business expenses reportable on the 261
individual's form 2106 that the individual deducted for federal 262
income tax purposes for the taxable year, subject to the 263
limitation imposed by section 67 of the Internal Revenue Code. For 264
the municipal corporation in which the taxpayer is a resident, the 265
taxpayer may deduct all such expenses. For a municipal corporation 266
in which the taxpayer is not a resident, the taxpayer may deduct 267
such expenses only to the extent the expenses are related to the 268
taxpayer's performance of personal services in that nonresident 269
municipal corporation.270

       (B) "Income" means the following:271

       (1)(a) For residents, all income, salaries, qualifying wages, 272
commissions, and other compensation from whatever source earned or 273
received by the resident, including the resident's distributive 274
share of the net profit of pass-through entities owned directly or 275
indirectly by the resident and any net profit of the resident.276

       (b) For the purposes of division (B)(1)(a) of this section, 277
the distributive share of any net operating loss attributable to 278
an ownership interest in a pass-through entity shall be allowed as 279
a deduction against any net profit of the resident generated 280
during the same taxable year, and any net operating loss of the 281
resident shall be allowed as a deduction against the distributive 282
share of any net profit attributable to an ownership interest in a 283
pass-through entity generated during the same taxable year.284

       (c) Division (B)(1)(b) of this section does not apply with 285
respect to any net profit or net operating loss attributable to an 286
ownership interest in an S corporation unless shareholders' 287
distributive shares of net profits from S corporations are subject 288
to tax in the municipal corporation as provided in division 289
(C)(14)(b) or (c) of this section.290

       (2) In the case of nonresidents, all income, salaries, 291
qualifying wages, commissions, and other compensation from 292
whatever source earned or received by the nonresident for work 293
done, services performed or rendered, or activities conducted in 294
the municipal corporation, including any net profit of the 295
nonresident, but excluding the nonresident's distributive share of 296
the net profit or loss of only pass-through entities owned 297
directly or indirectly by the nonresident.298

       (3) For taxpayers that are not individuals, net profit of the 299
taxpayer;300

       (4) Lottery, sweepstakes, gambling and sports winnings, 301
winnings from games of chance, and prizes and awards. If the 302
taxpayer is a professional gambler for federal income tax 303
purposes, the taxpayer may deduct related wagering losses and 304
expenses to the extent authorized under the Internal Revenue Code 305
and claimed against such winnings.306

       (C) "Exempt income" means all of the following:307

       (1) The military pay or allowances of members of the armed 308
forces of the United States or members of their reserve 309
components, including the national guard of any state;310

       (2)(a) Except as provided in division (C)(2)(b) of this 311
section, intangible income;312

       (b) A municipal corporation that taxed any type of intangible 313
income on March 29, 1988, pursuant to Section 3 of S.B. 238 of the 314
116th general assembly, may continue to tax that type of income if 315
a majority of the electors of the municipal corporation voting on 316
the question of whether to permit the taxation of that type of 317
intangible income after 1988 voted in favor thereof at an election 318
held on November 8, 1988.319

       (3) Social security benefits, railroad retirement benefits, 320
unemployment compensation, pensions, retirement benefit payments, 321
payments from annuities, and similar payments made to an employee 322
or to the beneficiary of an employee under a retirement program or 323
plan, disability payments received from private industry or local, 324
state, or federal governments or from charitable, religious or 325
educational organizations, and the proceeds of sickness, accident, 326
or liability insurance policies. As used in division (C)(3) of 327
this section, "unemployment compensation" does not include 328
supplemental unemployment compensation described in section 329
3402(o)(2) of the Internal Revenue Code.330

       (4) The income of religious, fraternal, charitable, 331
scientific, literary, or educational institutions to the extent 332
such income is derived from tax-exempt real estate, tax-exempt 333
tangible or intangible property, or tax-exempt activities.334

       (5) Compensation paid under section 3501.28 or 3501.36 of the 335
Revised Code to a person serving as a precinct election official 336
to the extent that such compensation does not exceed one thousand 337
dollars for the taxable year. Such compensation in excess of one 338
thousand dollars for the taxable year may be subject to taxation 339
by a municipal corporation. A municipal corporation shall not 340
require the payer of such compensation to withhold any tax from 341
that compensation.342

       (6) Dues, contributions, and similar payments received by 343
charitable, religious, educational, or literary organizations or 344
labor unions, lodges, and similar organizations;345

       (7) Alimony and child support received;346

       (8) Compensation for personal injuries or for damages to 347
property from insurance proceeds or otherwise, excluding 348
compensation paid for lost salaries or wages or compensation from 349
punitive damages;350

       (9) Income of a public utility when that public utility is 351
subject to the tax levied under section 5727.24 or 5727.30 of the 352
Revised Code. Division (C)(9) of this section does not apply for 353
purposes of Chapter 5745. of the Revised Code.354

       (10) Gains from involuntary conversions, interest on federal 355
obligations, items of income subject to a tax levied by the state 356
and that a municipal corporation is specifically prohibited by law 357
from taxing, and income of a decedent's estate during the period 358
of administration except such income from the operation of a trade 359
or business;360

       (11) Compensation or allowances excluded from federal gross 361
income under section 107 of the Internal Revenue Code;362

       (12) Employee compensation that is not qualifying wages;363

       (13) Compensation paid to a person employed within the 364
boundaries of a United States air force base under the 365
jurisdiction of the United States air force that is used for the 366
housing of members of the United States air force and is a center 367
for air force operations, unless the person is subject to taxation 368
because of residence or domicile. If the compensation is subject 369
to taxation because of residence or domicile, tax on such income 370
shall be payable only to the municipal corporation of residence or 371
domicile.372

       (14)(a) Except as provided in division (C)(14)(b) or (c) of 373
this section, an S corporation shareholder's distributive share of 374
net profits of the S corporation, other than any part of the 375
distributive share of net profits that represents wages as defined 376
in section 3121(a) of the Internal Revenue Code or net earnings 377
from self-employment as defined in section 1402(a) of the Internal 378
Revenue Code.379

       (b) If, pursuant to division (H) of former section 718.01 of 380
the Revised Code as it existed before March 11, 2004, a majority 381
of the electors of a municipal corporation voted in favor of the 382
question at an election held on November 4, 2003, the municipal 383
corporation may continue after 2002 to tax an S corporation 384
shareholder's distributive share of net profits of an S 385
corporation.386

       (c) If, on December 6, 2002, a municipal corporation was 387
imposing, assessing, and collecting a tax on an S corporation 388
shareholder's distributive share of net profits of the S 389
corporation to the extent the distributive share would be 390
allocated or apportioned to this state under divisions (B)(1) and 391
(2) of section 5733.05 of the Revised Code if the S corporation 392
were a corporation subject to taxes imposed under Chapter 5733. of 393
the Revised Code, the municipal corporation may continue to impose 394
the tax on such distributive shares to the extent such shares 395
would be so allocated or apportioned to this state only until 396
December 31, 2004, unless a majority of the electors of the 397
municipal corporation voting on the question of continuing to tax 398
such shares after that date vote in favor of that question at an 399
election held November 2, 2004. If a majority of those electors 400
vote in favor of the question, the municipal corporation may 401
continue after December 31, 2004, to impose the tax on such 402
distributive shares only to the extent such shares would be so 403
allocated or apportioned to this state.404

       (d) A municipal corporation shall be deemed to have elected 405
to tax S corporation shareholders' distributive shares of net 406
profits of the S corporation in the hands of the shareholders if a 407
majority of the electors of a municipal corporation vote in favor 408
of a question at an election held under division (C)(14)(b) or (c) 409
of this section. The municipal corporation shall specify by 410
resolution or ordinance that the tax applies to the distributive 411
share of a shareholder of an S corporation in the hands of the 412
shareholder of the S corporation.413

       (15) To the extent authorized under a resolution or ordinance 414
adopted by a municipal corporation before January 1, 2015, all or 415
a portion of the income of individuals or a class of individuals 416
under eighteen years of age.417

       (16)(a) Except as provided in divisions (C)(16)(b), (c), and 418
(d) of this section, qualifying wages described in division (B)(1) 419
or (E) of section 718.011 of the Revised Code to the extent the 420
qualifying wages are not subject to withholding for the municipal 421
corporation under either of those divisions.422

       (b) The exemption provided in division (C)(16)(a) of this 423
section does not apply with respect to the municipal corporation 424
in which the employee resided at the time the employee earned the 425
qualifying wages.426

       (c) The exemption provided in division (C)(16)(a) of this 427
section does not apply to qualifying wages that an employer elects 428
to withhold under division (D)(2) of section 718.011 of the 429
Revised Code.430

       (d) The exemption provided in division (C)(16)(a) of this 431
section does not apply to qualifying wages if both of the 432
following conditions apply:433

       (i) For qualifying wages described in division (B)(1) of 434
section 718.011 of the Revised Code, the employee's employer 435
withholds and remits tax on the qualifying wages to the municipal 436
corporation in which the employee's principal place of work is 437
situated, or, for qualifying wages described in division (E) of 438
section 718.011 of the Revised Code, the employee's employer 439
withholds and remits tax on the qualifying wages to the municipal 440
corporation in which the employer's fixed location is located;441

       (ii) The employee receives a refund of the tax described in 442
division (C)(16)(d)(i) of this section on the basis of the 443
employee not performing services in that municipal corporation.444

        (17) Compensation that is not qualifying wages paid to a 445
nonresident individual for personal services performed in the 446
municipal corporation as a member of the board of directors of a 447
corporation on not more than twenty days in a taxable year.448

       (18) Income the taxation of which is prohibited by the 449
constitution or laws of the United States.450

       Any item of income that is exempt income of a pass-through 451
entity under division (C) of this section is exempt income of each 452
owner of the pass-through entity to the extent of that owner's 453
distributive or proportionate share of that item of the entity's 454
income.455

       (D)(1) "Net profit" for a person other than an individual 456
means adjusted federal taxable income.457

       (2) "Net profit" for a person who is an individual means the 458
individual's net profit required to be reported on schedule C, 459
schedule E, or schedule F reduced by any net operating loss 460
carried forward. For the purposes of division (D)(2) of this 461
section, the net operating loss carried forward shall be 462
calculated and deducted in the same manner as provided in division 463
(E)(8) of this section.464

       (3) For the purposes of this chapter, and notwithstanding 465
division (D)(1) of this section, net profit of a disregarded 466
entity shall not be taxable as against that disregarded entity, 467
but shall instead be included in the net profit of the owner of 468
the disregarded entity.469

       (E) "Adjusted federal taxable income," for a person required 470
to file as a C corporation means a C corporation's federal taxable 471
income before net operating losses and special deductions as 472
determined under the Internal Revenue Code, adjusted as follows:473

       (1) Deduct intangible income to the extent included in 474
federal taxable income. The deduction shall be allowed regardless 475
of whether the intangible income relates to assets used in a trade 476
or business or assets held for the production of income.477

       (2) Add an amount equal to five per cent of intangible income 478
deducted under division (E)(1) of this section, but excluding that 479
portion of intangible income directly related to the sale, 480
exchange, or other disposition of property described in section 481
1221 of the Internal Revenue Code;482

       (3) Add any losses allowed as a deduction in the computation 483
of federal taxable income if the losses directly relate to the 484
sale, exchange, or other disposition of an asset described in 485
section 1221 or 1231 of the Internal Revenue Code; 486

       (4)(a) Except as provided in division (E)(4)(b) of this 487
section, deduct income and gain included in federal taxable income 488
to the extent the income and gain directly relate to the sale, 489
exchange, or other disposition of an asset described in section 490
1221 or 1231 of the Internal Revenue Code;491

       (b) Division (E)(4)(a) of this section does not apply to the 492
extent the income or gain is income or gain described in section 493
1245 or 1250 of the Internal Revenue Code.494

       (5) Add taxes on or measured by net income allowed as a 495
deduction in the computation of federal taxable income;496

       (6) In the case of a real estate investment trust or 497
regulated investment company, add all amounts with respect to 498
dividends to, distributions to, or amounts set aside for or 499
credited to the benefit of investors and allowed as a deduction in 500
the computation of federal taxable income;501

       (7) Deduct, to the extent not otherwise deducted or excluded 502
in computing federal taxable income, any income derived from a 503
transfer agreement or from the enterprise transferred under that 504
agreement under section 4313.02 of the Revised Code;505

       (8)(a) Except as limited by divisions (E)(8)(b), (c), and (d) 506
of this section, deduct the following:507

       (i) For a municipal corporation that levies an income tax 508
before January 1, 2015, any net operating loss incurred by the 509
person in taxable years beginning after 2015. 510

       (ii) For a municipal corporation that does not levy an income 511
tax before January 1, 2015, any net operating loss incurred by the 512
person in taxable years beginning on or after the effective date 513
of the income tax.514

       For any municipal corporation, the amount of the net 515
operating loss shall be deducted from net profit reduced by exempt 516
income to the extent necessary to reduce municipal taxable income 517
to zero, with any remaining unused portion of the net operating 518
loss carried forward to not more than five consecutive taxable 519
years following the taxable year in which the loss was incurred, 520
but in no case for more years than necessary for the deduction to 521
be fully utilized.522

       (b) No person shall use the deduction allowed by division 523
(E)(8) of this section to offset qualifying wages.524

       (c)(i) For taxable years beginning in 2017, 2018, 2019, 2020, 525
or 2021, a person may not deduct, for purposes of an income tax 526
levied by a municipal corporation that levies an income tax before 527
January 1, 2015, more than fifty per cent of the amount of the 528
deduction otherwise allowed by division (E)(8)(a) of this section.529

       (ii) For taxable years beginning in 2022 or thereafter, a 530
person may deduct, for purposes of an income tax levied by a 531
municipal corporation that levies an income tax before January 1, 532
2015, the full amount allowed by division (E)(8)(a) of this 533
section.534

       (d) Any pre-2016 net operating loss carryforward deduction 535
that is available must be utilized before a taxpayer may deduct 536
any amount pursuant to division (E)(8) of this section.537

       (e) Nothing in divisions (E)(8)(c)(i) and (ii) of this 538
section precludes a person from carrying forward, for the period 539
otherwise permitted under division (E)(8)(a) of this section, any 540
amount of net operating loss that was not fully utilized by 541
operation of divisions (E)(8)(c)(i) and (ii) of this section.542

       (9) Deduct any net profit of a pass-through entity owned 543
directly or indirectly by the taxpayer and included in the 544
taxpayer's federal taxable income unless an affiliated group of 545
corporations includes that net profit in the group's federal 546
taxable income in accordance with division (E)(3)(b) of section 547
718.06 of the Revised Code.548

       (10) Add any loss incurred by a pass-through entity owned 549
directly or indirectly by the taxpayer and included in the 550
taxpayer's federal taxable income unless an affiliated group of 551
corporations includes that loss in the group's federal taxable 552
income in accordance with division (E)(3)(b) of section 718.06 of 553
the Revised Code.554

       If the taxpayer is not a C corporation, is not a disregarded 555
entity, and is not an individual, the taxpayer shall compute 556
adjusted federal taxable income under this section as if the 557
taxpayer were a C corporation, except guaranteed payments and 558
other similar amounts paid or accrued to a partner, former 559
partner, shareholder, former shareholder, member, or former member 560
shall not be allowed as a deductible expense unless such payments 561
are in consideration for the use of capital and treated as payment 562
of interest under section 469 of the Internal Revenue Code or 563
United States treasury regulations. Amounts paid or accrued to a 564
qualified self-employed retirement plan with respect to a partner, 565
former partner, shareholder, former shareholder, member, or former 566
member of the taxpayer, amounts paid or accrued to or for health 567
insurance for a partner, former partner, shareholder, former 568
shareholder, member, or former member, and amounts paid or accrued 569
to or for life insurance for a partner, former partner, 570
shareholder, former shareholder, member, or former member shall 571
not be allowed as a deduction.572

       Nothing in division (E) of this section shall be construed as 573
allowing the taxpayer to add or deduct any amount more than once 574
or shall be construed as allowing any taxpayer to deduct any 575
amount paid to or accrued for purposes of federal self-employment 576
tax.577

       (F) "Schedule C" means internal revenue service schedule C 578
(form 1040) filed by a taxpayer pursuant to the Internal Revenue 579
Code.580

       (G) "Schedule E" means internal revenue service schedule E 581
(form 1040) filed by a taxpayer pursuant to the Internal Revenue 582
Code.583

       (H) "Schedule F" means internal revenue service schedule F 584
(form 1040) filed by a taxpayer pursuant to the Internal Revenue 585
Code.586

       (I) "Internal Revenue Code" has the same meaning as in 587
section 5747.01 of the Revised Code.588

       (J) "Resident" means an individual who is domiciled in the 589
municipal corporation as determined under section 718.012 of the 590
Revised Code.591

       (K) "Nonresident" means an individual that is not a resident.592

       (L)(1) "Taxpayer" means a person subject to a tax levied on 593
income by a municipal corporation in accordance with this chapter. 594
"Taxpayer" does not include a grantor trust or, except as provided 595
in division (L)(2)(a) of this section, a disregarded entity.596

       (2)(a) A single member limited liability company that is a 597
disregarded entity for federal tax purposes may be a separate 598
taxpayer from its single member in all Ohio municipal corporations 599
in which it either filed as a separate taxpayer or did not file 600
for its taxable year ending in 2003, if all of the following 601
conditions are met:602

       (i) The limited liability company's single member is also a 603
limited liability company.604

       (ii) The limited liability company and its single member were 605
formed and doing business in one or more Ohio municipal 606
corporations for at least five years before January 1, 2004.607

       (iii) Not later than December 31, 2004, the limited liability 608
company and its single member each made an election to be treated 609
as a separate taxpayer under division (L) of this section as this 610
section existed on December 31, 2004.611

       (iv) The limited liability company was not formed for the 612
purpose of evading or reducing Ohio municipal corporation income 613
tax liability of the limited liability company or its single 614
member.615

       (v) The Ohio municipal corporation that was the primary place 616
of business of the sole member of the limited liability company 617
consented to the election.618

       (b) For purposes of division (L)(2)(a)(v) of this section, a 619
municipal corporation was the primary place of business of a 620
limited liability company if, for the limited liability company's 621
taxable year ending in 2003, its income tax liability was greater 622
in that municipal corporation than in any other municipal 623
corporation in Ohio, and that tax liability to that municipal 624
corporation for its taxable year ending in 2003 was at least four 625
hundred thousand dollars.626

       (M) "Person" includes individuals, firms, companies, joint 627
stock companies, business trusts, estates, trusts, partnerships, 628
limited liability partnerships, limited liability companies, 629
associations, C corporations, S corporations, governmental 630
entities, and any other entity.631

       (N) "Pass-through entity" means a partnership not treated as 632
an association taxable as a C corporation for federal income tax 633
purposes, a limited liability company not treated as an 634
association taxable as a C corporation for federal income tax 635
purposes, an S corporation, or any other class of entity from 636
which the income or profits of the entity are given pass-through 637
treatment for federal income tax purposes. "Pass-through entity" 638
does not include a trust, estate, grantor of a grantor trust, or 639
disregarded entity.640

       (O) "S corporation" means a person that has made an election 641
under subchapter S of Chapter 1 of Subtitle A of the Internal 642
Revenue Code for its taxable year.643

       (P) "Single member limited liability company" means a limited 644
liability company that has one direct member.645

       (Q) "Limited liability company" means a limited liability 646
company formed under Chapter 1705. of the Revised Code or under 647
the laws of another state.648

       (R) "Qualifying wages" means wages, as defined in section 649
3121(a) of the Internal Revenue Code, without regard to any wage 650
limitations, adjusted as follows:651

       (1) Deduct the following amounts:652

       (a) Any amount included in wages if the amount constitutes 653
compensation attributable to a plan or program described in 654
section 125 of the Internal Revenue Code.655

       (b) Any amount included in wages if the amount constitutes 656
payment on account of a disability related to sickness or an 657
accident paid by a party unrelated to the employer, agent of an 658
employer, or other payer.659

       (c) Any amount attributable to a nonqualified deferred 660
compensation plan or program described in section 3121(v)(2)(C) of 661
the Internal Revenue Code if the compensation is included in wages 662
and the municipal corporation has, by resolution or ordinance 663
adopted before January 1, 2015, exempted the amount from 664
withholding and tax.665

       (d) Any amount included in wages if the amount arises from 666
the sale, exchange, or other disposition of a stock option, the 667
exercise of a stock option, or the sale, exchange, or other 668
disposition of stock purchased under a stock option and the 669
municipal corporation has, by resolution or ordinance adopted 670
before January 1, 2015, exempted the amount from withholding and 671
tax.672

       (e) Any amount that is exempt income.673

       (2) Add the following amounts:674

       (a) Any amount not included in wages solely because the 675
employee was employed by the employer before April 1, 1986.676

       (b) Any amount not included in wages because the amount 677
arises from the sale, exchange, or other disposition of a stock 678
option, the exercise of a stock option, or the sale, exchange, or 679
other disposition of stock purchased under a stock option and the 680
municipal corporation has not, by resolution or ordinance, 681
exempted the amount from withholding and tax adopted before 682
January 1, 2015. Division (R)(2)(b) of this section applies only 683
to those amounts constituting ordinary income.684

       (c) Any amount not included in wages if the amount is an 685
amount described in section 401(k), 403(b), or 457 of the Internal 686
Revenue Code. Division (R)(2)(c) of this section applies only to 687
employee contributions and employee deferrals.688

       (d) Any amount that is supplemental unemployment compensation 689
benefits described in section 3402(o)(2) of the Internal Revenue 690
Code and not included in wages.691

       (e) Any amount received that is treated as self-employment 692
income for federal tax purposes in accordance with section 693
1402(a)(8) of the Internal Revenue Code.694

       (f) Any amount not included in wages if all of the following 695
apply:696

       (i) For the taxable year the amount is employee compensation 697
that is included in the taxpayer's gross income for federal income 698
tax purposes;699

       (ii) For no preceding taxable year did the amount constitute 700
wages as defined in section 3121(a) of the Internal Revenue Code;701

       (iii) For no succeeding taxable year will the amount 702
constitute wages; and 703

       (iv) For any taxable year the amount has not otherwise been 704
added to wages pursuant to either division (R)(2) of this section 705
or section 718.03 of the Revised Code, as that section existed 706
before the effective date of H.B. 5 of the 130th general assembly.707

       (S) "Intangible income" means income of any of the following 708
types: income yield, interest, capital gains, dividends, or other 709
income arising from the ownership, sale, exchange, or other 710
disposition of intangible property including, but not limited to, 711
investments, deposits, money, or credits as those terms are 712
defined in Chapter 5701. of the Revised Code, and patents, 713
copyrights, trademarks, tradenames, investments in real estate 714
investment trusts, investments in regulated investment companies, 715
and appreciation on deferred compensation. "Intangible income" 716
does not include prizes, awards, or other income associated with 717
any lottery winnings, gambling winnings, or other similar games of 718
chance.719

       (T) "Taxable year" means the corresponding tax reporting 720
period as prescribed for the taxpayer under the Internal Revenue 721
Code.722

       (U) "Tax administrator" means the individual charged with 723
direct responsibility for administration of an income tax levied 724
by a municipal corporation in accordance with this chapter, and 725
also includes the following:726

       (1) A municipal corporation acting as the agent of another 727
municipal corporation;728

       (2) A person retained by a municipal corporation to 729
administer a tax levied by the municipal corporation, but only if 730
the municipal corporation does not compensate the person in whole 731
or in part on a contingency basis;732

       (3) The central collection agency or the regional income tax 733
agency or their successors in interest, or another entity 734
organized to perform functions similar to those performed by the 735
central collection agency and the regional income tax agency.736

       (V) "Employer" means a person that is an employer for federal 737
income tax purposes.738

       (W) "Employee" means an individual who is an employee for 739
federal income tax purposes.740

       (X) "Other payer" means any person, other than an 741
individual's employer or the employer's agent, that pays an 742
individual any amount included in the federal gross income of the 743
individual. "Other payer" includes casino operators and video 744
lottery terminal sales agents.745

       (Y) "Calendar quarter" means the three-month period ending on 746
the last day of March, June, September, or December.747

       (Z) "Form 2106" means internal revenue service form 2106 748
filed by a taxpayer pursuant to the Internal Revenue Code.749

       (AA) "Municipal corporation" includes a joint economic 750
development district or joint economic development zone that 751
levies an income tax under section 715.691, 715.70, 715.71, or 752
715.74 of the Revised Code.753

       (BB) "Disregarded entity" means a single member limited 754
liability company, a qualifying subchapter S subsidiary, or 755
another entity if the company, subsidiary, or entity is a 756
disregarded entity for federal income tax purposes.757

       (CC) "Generic form" means an electronic or paper form 758
designed for reporting taxes withheld by an employer, agent of an 759
employer, or other payer, estimated municipal income taxes, or 760
annual municipal income tax liability or for filing a refund 761
claim.762

       (DD) "Tax return preparer" means any individual described in 763
section 7701(a)(36) of the Internal Revenue Code and 26 C.F.R. 764
301.7701-15.765

       (EE) "Ohio business gateway" means the online computer 766
network system, created under section 125.30 of the Revised Code, 767
that allows persons to electronically file business reply forms 768
with state agencies and includes any successor electronic filing 769
and payment system.770

       (FF) "Local board of tax review" and "board of tax review" 771
mean the entity created under section 718.11 of the Revised Code.772

       (GG) "Net operating loss" means a loss incurred by a person 773
in the operation of a trade or business. "Net operating loss" does 774
not include unutilized losses resulting from basis limitations, 775
at-risk limitations, or passive activity loss limitations.776

       (HH) "Casino operator" and "casino facility" have the same 777
meanings as in section 3772.01 of the Revised Code.778

       (II) "Video lottery terminal" has the same meaning as in 779
section 3770.21 of the Revised Code.780

       (JJ) "Video lottery terminal sales agent" means a lottery 781
sales agent licensed under Chapter 3770. of the Revised Code to 782
conduct video lottery terminals on behalf of the state pursuant to 783
section 3770.21 of the Revised Code.784

       (KK) "Postal service" means the United States postal service.785

       (LL) "Certified mail," "express mail," "United States mail," 786
"postal service," and similar terms include any delivery service 787
authorized pursuant to section 5703.056 of the Revised Code.788

       (MM) "Postmark date," "date of postmark," and similar terms 789
include the date recorded and marked in the manner described in 790
division (B)(3) of section 5703.056 of the Revised Code.791

       (NN) "Related member" means a person that, with respect to 792
the taxpayer during all or any portion of the taxable year, is 793
either a related entity, a component member as defined in section 794
1563(b) of the Internal Revenue Code, or a person to or from whom 795
there is attribution of stock ownership in accordance with section 796
1563(e) of the Internal Revenue Code except, for purposes of 797
determining whether a person is a related member under this 798
division, "twenty per cent" shall be substituted for "5 percent" 799
wherever "5 percent" appears in section 1563(e) of the Internal 800
Revenue Code.801

       (OO) "Related entity" means any of the following: 802

       (1) An individual stockholder, or a member of the 803
stockholder's family enumerated in section 318 of the Internal 804
Revenue Code, if the stockholder and the members of the 805
stockholder's family own directly, indirectly, beneficially, or 806
constructively, in the aggregate, at least fifty per cent of the 807
value of the taxpayer's outstanding stock;808

       (2) A stockholder, or a stockholder's partnership, estate, 809
trust, or corporation, if the stockholder and the stockholder's 810
partnerships, estates, trusts, or corporations own directly, 811
indirectly, beneficially, or constructively, in the aggregate, at 812
least fifty per cent of the value of the taxpayer's outstanding 813
stock;814

       (3) A corporation, or a party related to the corporation in a 815
manner that would require an attribution of stock from the 816
corporation to the party or from the party to the corporation 817
under division (OO)(4) of this section, provided the taxpayer owns 818
directly, indirectly, beneficially, or constructively, at least 819
fifty per cent of the value of the corporation's outstanding 820
stock;821

       (4) The attribution rules described in section 318 of the 822
Internal Revenue Code apply for the purpose of determining whether 823
the ownership requirements in divisions (OO)(1) to (3) of this 824
section have been met.825

       (PP)(1) "Written determination by the tax administrator" 826
means a written ruling by a tax administrator in response to a 827
written request by a taxpayer regarding the taxpayer's municipal 828
income tax liability, including tax, penalty, interest, or any 829
combination thereof, to the municipal corporation that commences 830
the person's time limitation for making an appeal to the local 831
board of tax review pursuant to section 718.11 of the Revised Code 832
and that has "written determination" printed in all capital 833
letters in a font size no smaller than eighteen point at the top 834
of the first page of the written ruling.835

       (2) "Written determination by the tax administrator" does not 836
include a denial, in whole or in part, of a taxpayer's refund 837
claim based on an originally filed annual tax return, a billing 838
statement notifying a taxpayer of current or past-due balances 839
owed to the municipal corporation, a tax administrator's request 840
for additional information, a notification to the taxpayer of 841
mathematical errors, or a tax administrator's other written 842
correspondence to a person or taxpayer.843

       (QQ) "Taxpayer rights and responsibilities" means the rights 844
provided to taxpayers in sections 718.11, 718.12, 718.18, 718.19, 845
718.23, 718.38, 5717.011, and 5717.03 of the Revised Code and the 846
responsibilities of taxpayers to file, report, withhold, remit, 847
and pay municipal income tax and otherwise comply with Chapter 848
718. of the Revised Code and resolutions, ordinances, and rules 849
adopted by a municipal corporation for the imposition and 850
administration of a municipal income tax.851

       (RR) "Qualified municipal corporation" means a municipal 852
corporation that, by resolution or ordinance adopted on or before 853
December 31, 2011, adopted Ohio adjusted gross income, as defined 854
by section 5747.01 of the Revised Code, as the income subject to 855
tax for the purposes of imposing a municipal income tax.856

       (SS)(1) "Pre-2016 net operating loss carryforward" means any 857
net operating loss incurred in a taxable year beginning before 858
January 1, 2016, to the extent such loss was permitted, by a 859
resolution or ordinance of the municipal corporation that was 860
adopted by the municipal corporation before January 1, 2016, to be 861
carried forward and utilized to offset income or net profit 862
generated in such municipal corporation in future taxable years.863

       (2) For the purpose of calculating municipal taxable income, 864
any pre-2016 net operating loss carryforward may be carried 865
forward to any taxable year, including taxable years beginning in 866
2016 or thereafter, for the number of taxable years provided in 867
the resolution or ordinance or until fully utilized, whichever is 868
earlier.869

       Sec. 718.011.  (A) As used in this section:870

       (1) "Employer" includes a person that is a related member to 871
or of an employer.872

       (2) "Professional athlete" means an athlete who performs 873
services in a professional athletic event for wages or other 874
remuneration.875

       (3) "Professional entertainer" means a person who performs 876
services in the professional performing arts for wages or other 877
remuneration on a per-event basis.878

       (4) "Public figure" means a person of prominence who performs 879
services at discrete events, such as speeches, public appearances, 880
or similar events, for wages or other remuneration on a per-event 881
basis.882

       (5) "Fixed location" means a permanent place of doing 883
business in this state, such as an office, warehouse, storefront, 884
or similar location owned or controlled by an employer.885

       (6) "Worksite location" means a construction site or other 886
temporary worksite in this state at which the employer provides 887
services for more than twenty days during the calendar year. 888
"Worksite location" does not include the home of an employee.889

        (7) "Principal place of work" means the fixed location to 890
which an employee is required to report for employment duties on a 891
regular and ordinary basis. If the employee is not required to 892
report for employment duties on a regular and ordinary basis to a 893
fixed location, "principal place of work" means the worksite 894
location to which the employee is required to report for 895
employment duties on a regular and ordinary basis. If the employee 896
is not required to report for employment duties on a regular and 897
ordinary basis to a fixed location or worksite location, 898
"principal place of work" means the location in this state at 899
which the employee spends the greatest number of days in a 900
calendar year performing services for or on behalf of the 901
employee's employer. For the purposes of this division, the 902
location at which an employee spends a particular day shall be 903
determined in accordance with division (B)(2) of this section, 904
except that "location" shall be substituted for "municipal 905
corporation" wherever "municipal corporation" appears in that 906
division.907

       (B)(1) Subject to divisions (C), (E), and (F) of this 908
section, an employer is not required to withhold municipal income 909
tax on qualifying wages paid to an employee for the performance of 910
personal services in a municipal corporation that imposes such a 911
tax if the employee performed such services in the municipal 912
corporation on twenty or fewer days in a calendar year, unless one 913
of the following conditions applies:914

       (a) The employee's principal place of work is located in the 915
municipal corporation.916

       (b) The employee is a resident of the municipal corporation 917
and has requested that the employer withhold tax from the 918
employee's qualifying wages as provided in section 718.03 of the 919
Revised Code.920

       (c) The employee is a professional athlete, professional 921
entertainer, or public figure, and the qualifying wages are paid 922
for the performance of services in the employee's capacity as a 923
professional athlete, professional entertainer, or public figure.924

       (2) For the purposes of division (B)(1) of this section, an 925
employee shall be considered to have spent a day performing 926
services in a municipal corporation only if the employee spent 927
more time performing services for or on behalf of the employer in 928
that municipal corporation than in any other municipal corporation 929
on that day. For the purposes of determining the amount of time an 930
employee spent in a particular location, the time spent performing 931
one of more of the following activities shall be considered to 932
have been spent at the employee's principal place of work:933

       (a) Traveling to the location at which the employee will 934
first perform services for the employer for the day;935

       (b) Traveling from a location at which the employee was 936
performing services for the employer to any other location;937

       (c) Traveling from any location to another location in order 938
to pick up or load, for the purpose of transportation or delivery, 939
property that has been purchased, sold, assembled, fabricated, 940
repaired, refurbished, processed, remanufactured, or improved by 941
the employee's employer;942

       (d) Transporting or delivering property described in division 943
(B)(2)(c) of this section, provided that, upon delivery of the 944
property, the employee does not temporarily or permanently affix 945
the property to real estate owned, used, or controlled by a person 946
other than the employee's employer;947

       (e) Traveling from the location at which the employee makes 948
the employee's final delivery or pick-up for the day to either the 949
employee's principal place of work or a location at which the 950
employee will not perform services for the employer.951

       (C) If the principal place of work of an employee is located 952
in a municipal corporation that imposes an income tax in 953
accordance with this chapter, the exception from withholding 954
requirements described in division (B)(1) of this section shall 955
apply only if, with respect to the employee's qualifying wages 956
described in that division, the employer withholds and remits tax 957
on such qualifying wages to the municipal corporation in which the 958
employee's principal place of work is located.959

       (D)(1) Except as provided in division (D)(2) of this section, 960
if, during a calendar year, the number of days an employee spends 961
performing personal services in a municipal corporation exceeds 962
the twenty-day threshold described in division (B)(1) of this 963
section, the employer shall withhold and remit tax to that 964
municipal corporation for any subsequent days in that calendar 965
year on which the employer pays qualifying wages to the employee 966
for personal services performed in that municipal corporation.967

       (2) An employer required to begin withholding tax for a 968
municipal corporation under division (D)(1) of this section may 969
elect to withhold tax for that municipal corporation for the first 970
twenty days on which the employer paid qualifying wages to the 971
employee for personal services performed in that municipal 972
corporation. The employer shall make the election on the annual 973
tax return the employer files with the municipal corporation under 974
section 718.05 or 718.06 of the Revised Code. Taxes withheld and 975
paid by such an employer during those first twenty days to the 976
municipal corporation in which the employee's principal place of 977
work is located are refundable to the employee.978

       (E) Without regard to the number of days in a calendar year 979
on which an employee performs personal services in any municipal 980
corporation, an employer shall withhold municipal income tax on 981
all of the employee's qualifying wages for a taxable year and 982
remit that tax only to the municipal corporation in which the 983
employer's fixed location is located if the total gross receipts 984
of the employer for the preceding taxable year were less than five 985
hundred thousand dollars.986

       To determine whether an employer meets the requirements of 987
division (E) of this section for a taxable year, a tax 988
administrator may require the employer to provide the tax 989
administrator with the employer's federal income tax return for 990
the preceding taxable year.991

       (F) Divisions (B)(1) and (D) of this section shall not apply 992
to the extent that a tax administrator and an employer enter into 993
an agreement regarding the manner in which the employer shall 994
comply with the requirements of section 718.03 of the Revised 995
Code.996

       Sec. 718.012.  (A)(1) As used in this chapter, "domicile" 997
means the principal residence that an individual intends to use 998
for an indefinite period of time and to which, whenever absent, 999
the individual intends to return. An individual is domiciled in a 1000
municipal corporation for all or part of a taxable year if, based 1001
on the factors described in division (B) of this section and any 1002
other factor the tax administrator considers relevant or which 1003
demonstrates an intent to return, the tax administrator reasonably 1004
concludes that the individual is domiciled in the municipal 1005
corporation for all or part of the taxable year.1006

       (2) An individual may rebut the conclusion of domicile 1007
described in division (A)(1) of this section only if, based on the 1008
factors described in division (B) of this section and any other 1009
factor the individual considers relevant, the individual 1010
establishes by a preponderance of the evidence that the individual 1011
was not domiciled in the municipal corporation for all or part of 1012
the taxable year.1013

       (B) The factors that a tax administrator may consider when 1014
determining whether an individual is domiciled in a municipal 1015
corporation for all or part of a taxable year include, but are not 1016
limited to, the following:1017

       (1) The location of law firms, accounting firms, health care 1018
providers, and similar professionals utilized by the individual or 1019
the individual's spouse;1020

       (2) The location of organizations described in section 501(c) 1021
of the Internal Revenue Code to which the individual or the 1022
individual's spouse make contributions or other payments or in 1023
which they participate as a congregant, member, board member, 1024
committee member, adviser, or consultant;1025

       (3) The location, place of business, or place of organization 1026
or incorporation of a corporation, partnership, limited liability 1027
company, or other business venture or entity in which the 1028
individual or the individual's spouse is a shareholder or limited 1029
partner or for which the individual or individual's spouse is a 1030
member of the board of directors;1031

       (4) The location of the individual's friends, dependents as 1032
defined in section 152 of the Internal Revenue Code, and family 1033
members other than the individual's spouse;1034

       (5) The location of educational institutions that are 1035
attended by the individual's dependents as defined in section 152 1036
of the Internal Revenue Code or from which the individual or the 1037
individual's spouse or dependents claimed the benefit of in-state 1038
tuition rates available only to individuals domiciled in the 1039
state; 1040

       (6) The location of all businesses at which the individual or 1041
the individual's spouse makes purchases of tangible personal 1042
property;1043

       (7) Whether the individual is registered to vote, or has 1044
voted, in the municipal corporation during the taxable year;1045

       (8) The location at which the individual acquired or renewed 1046
the individual's Ohio driver's license, or the location at which 1047
the individual's vehicle is registered, for the taxable year;1048

       (9) The place of employment of the individual or the 1049
individual's spouse.1050

       (10) The location of any real property owned or leased by the 1051
individual or the individual's spouse.1052

       (11) The address used by the individual or the individual's 1053
spouse on federal or state tax returns, bills, invoices, credit 1054
card statements, utility bills, and other mailings for the taxable 1055
year.1056

       (C) A taxpayer has only one domicile. A domicile once 1057
acquired is presumed to continue until it is shown to have been 1058
changed. When a taxpayer alleges a change of domicile, the 1059
taxpayer bears the burden of proof of demonstrating the change as 1060
provided in division (A)(2) of this section. 1061

       Sec. 718.02.  This section does not apply to taxpayers that 1062
are subject to and required to file reports under Chapter 5745. of 1063
the Revised Code.applies to any taxpayer engaged in a business or 1064
profession in a municipal corporation that imposes an income tax 1065
in accordance with this chapter, unless the taxpayer is an 1066
individual who resides in the municipal corporation or the 1067
taxpayer is an electric company, combined company, or telephone 1068
company that is subject to and required to file reports under 1069
Chapter 5745. of the Revised Code.1070

       (A) Except as otherwise provided in division (D)(B) of this 1071
section, net profit from a business or profession conducted both 1072
within and without the boundaries of a municipal corporation shall 1073
be considered as having a taxable situs in suchthe municipal 1074
corporation for purposes of municipal income taxation in the same 1075
proportion as the average ratio of the following:1076

       (1) The average original cost of the real and tangible 1077
personal property owned or used by the taxpayer in the business or 1078
profession in suchthe municipal corporation during the taxable 1079
period to the average original cost of all of the real and 1080
tangible personal property owned or used by the taxpayer in the 1081
business or profession during the same period, wherever situated.1082

       As used in the preceding paragraph, tangible personal or real 1083
property shall include property rented or leased by the taxpayer 1084
and the value of such property shall be determined by multiplying 1085
the annual rental thereon by eight;1086

       (2) Wages, salaries, and other compensation paid during the 1087
taxable period to personsindividuals employed in the business or 1088
profession for services performed in suchthe municipal 1089
corporation to wages, salaries, and other compensation paid during 1090
the same period to personsindividuals employed in the business or 1091
profession, wherever theirthe individual's services are 1092
performed, excluding compensation that is not taxable by the 1093
municipal corporation under section 718.011from which taxes are 1094
not required to be withheld under section 718.011 of the Revised 1095
Code;1096

       (3) GrossTotal gross receipts of the business or profession 1097
from sales and rentals made and services performed during the 1098
taxable period in suchthe municipal corporation to total gross 1099
receipts of the business or profession during the same period from 1100
sales, rentals, and services, wherever made or performed.1101

       If the foregoing apportionment formula does not produce an 1102
equitable result, another basis may be substituted, under uniform 1103
regulations, so as to produce an equitable result.1104

       (B) As used in division (A) of this section, "sales made in a 1105
municipal corporation" mean:1106

       (1) All sales of tangible personal property delivered within 1107
such municipal corporation regardless of where title passes if 1108
shipped or delivered from a stock of goods within such municipal 1109
corporation;1110

       (2) All sales of tangible personal property delivered within 1111
such municipal corporation regardless of where title passes even 1112
though transported from a point outside such municipal corporation 1113
if the taxpayer is regularly engaged through its own employees in 1114
the solicitation or promotion of sales within such municipal 1115
corporation and the sales result from such solicitation or 1116
promotion;1117

       (3) All sales of tangible personal property shipped from a 1118
place within such municipal corporation to purchasers outside such 1119
municipal corporation regardless of where title passes if the 1120
taxpayer is not, through its own employees, regularly engaged in 1121
the solicitation or promotion of sales at the place where delivery 1122
is made.1123

       (C) Except as otherwise provided in division (D) of this 1124
section, net(B)(1) If it is determined by a preponderance of the 1125
evidence that the apportionment factors described in division (A) 1126
of this section do not fairly represent the extent of a taxpayer's 1127
business activity in a municipal corporation, the tax 1128
administrator of the municipal corporation may require the 1129
taxpayer to use, with respect to all or any portion of the income 1130
of the taxpayer, an alternative apportionment method involving one 1131
or more of the following:1132

       (a) Separate accounting;1133

       (b) The exclusion of one or more of the factors;1134

       (c) The inclusion of one or more additional factors that 1135
would provide for a more fair apportionment of the income of the 1136
taxpayer to the municipal corporation;1137

       (d) A modification of one or more of the factors.1138

       (2) A taxpayer may use an alternative apportionment method on 1139
the taxpayer's tax return, provided the taxpayer notifies the tax 1140
administrator before filing the return. A taxpayer may not use an 1141
alternative apportionment method, an alternative method of 1142
accounting, or an alternative method of filing on a timely filed 1143
amended tax return without notifying the tax administrator before 1144
filing the return. An alternative apportionment method shall apply 1145
only to the taxable years included in the taxpayer's notification 1146
to the tax administrator.1147

       (C) As used in division (A)(2) of this section, "wages, 1148
salaries, and other compensation" includes only wages, salaries, 1149
or other compensation paid to an employee for services performed 1150
at any of the following locations:1151

       (1) A location that is owned, controlled, or used by, rented 1152
to, or under the possession of one of the following:1153

       (a) The employer;1154

       (b) A vendor, customer, client, or patient of the employer, 1155
or a related member of such a vendor, customer, client, or 1156
patient;1157

       (c) A vendor, customer, client, or patient of a person 1158
described in division (C)(1)(b) of this section, or a related 1159
member of such a vendor, customer, client, or patient.1160

       (2) Any location at which a trial, appeal, hearing, 1161
investigation, inquiry, review, court-martial, or similar 1162
administrative, judicial, or legislative matter or proceeding is 1163
being conducted, provided that the compensation is paid for 1164
services performed for, or on behalf of, the employer or that the 1165
employee's presence at the location directly or indirectly 1166
benefits the employer;1167

       (3) Any other location, if the tax administrator determines 1168
that the employer directed the employee to perform the services at 1169
the other location in lieu of a location described in division 1170
(C)(1) or (2) of this section solely in order to avoid or reduce 1171
the employer's municipal income tax liability. If a tax 1172
administrator makes such a determination, the employer may dispute 1173
the determination by establishing, by a preponderance of the 1174
evidence, that the tax administrator's determination was 1175
unreasonable.1176

       (D) For the purposes of division (A)(3) of this section, 1177
receipts from sales and rentals made and services performed shall 1178
be sitused to a municipal corporation as follows:1179

       (1) Gross receipts from the sale of tangible personal 1180
property shall be sitused to the municipal corporation in which 1181
the sale originated. For the purposes of this division, a sale of 1182
property originates in a municipal corporation if, regardless of 1183
where title passes, the property meets any of the following 1184
criteria:1185

       (a) The property is shipped to or delivered within the 1186
municipal corporation from a stock of goods located within the 1187
municipal corporation.1188

       (b) The property is delivered within the municipal 1189
corporation from a location outside the municipal corporation, 1190
provided the taxpayer is regularly engaged through its own 1191
employees in the solicitation or promotion of sales within such 1192
municipal corporation and the sales result from such solicitation 1193
or promotion. 1194

       (c) The property is shipped from a place within the municipal 1195
corporation to purchasers outside the municipal corporation, 1196
provided that the taxpayer is not regularly engaged in the 1197
solicitation or promotion of sales at the place where delivery is 1198
made.1199

       (2) Gross receipts from the sale of services shall be sitused 1200
to the municipal corporation to the extent that such services are 1201
performed in the municipal corporation.1202

       (3) To the extent included in income, gross receipts from the 1203
sale of real property located in the municipal corporation shall 1204
be sitused to the municipal corporation.1205

       (4) To the extent included in income, gross receipts from 1206
rents and royalties from real property located in the municipal 1207
corporation shall be sitused to the municipal corporation.1208

       (5) Gross receipts from rents and royalties from tangible 1209
personal property shall be sitused to the municipal corporation 1210
based upon the extent to which the tangible personal property is 1211
used in the municipal corporation.1212

       (E) The net profit of an individual from rental activity not 1213
constituting a business or profession shall be subject to tax only 1214
by the municipal corporation in which the property generating the 1215
net profit is located and the municipal corporation in which the 1216
taxpayer that receives the net profit resides.1217

       (D) This section does not apply to individuals who are 1218
residents of the municipal corporation and, except as otherwise 1219
provided in section 718.01 of the Revised Code, a municipal 1220
corporation may impose a tax on all income earned by residents of 1221
the municipal corporation to the extent allowed by the United 1222
States Constitution.1223

       (E) If, in computing the taxpayer's adjusted federal taxable 1224
income, the taxpayer deducted any amount with respect to a stock 1225
option granted to an employee, and if the employee is not required 1226
to include in income any amount or any portion thereof because it 1227
is exempted from taxation under division (H)(10) of section 718.01 1228
of the Revised Code and division (A)(2)(d) of section 718.03 of 1229
the Revised Code by a municipal corporation to which the taxpayer 1230
has apportioned a portion of its net profit, the taxpayer shall 1231
add the amount that is exempt from taxation to the taxpayer's net 1232
profit that was apportioned to that municipal corporation. In no 1233
case shall a taxpayer be required to add to its net profit that 1234
was apportioned to that municipal corporation any amount other 1235
than the amount upon which the employee would be required to pay 1236
tax were the amount related to the stock option not exempted from 1237
taxation.1238

       This division applies solely for the purpose of making an 1239
adjustment to the amount of a taxpayer's net profit that was 1240
apportioned to a municipal corporation under divisions (A) and (B) 1241
of this section.1242

       A municipal corporation shall allow taxpayers to elect to use 1243
separate accounting for the purpose of calculating net profit 1244
sitused to the municipal corporation under this division, but 1245
shall permit such an election only if the taxpayer requests to 1246
make the same election in every municipal corporation in which the 1247
taxpayer must report such net profit for the taxable year and if 1248
the taxpayer agrees to use separate accounting with respect to 1249
such net profit in every municipal corporation that approves such 1250
a request for at least five consecutive taxable years after making 1251
the election. 1252

       (F)(1) Except as provided in division (F)(2) of this section, 1253
commissions received by a real estate agent or broker relating to 1254
the sale, purchase, or lease of real estate shall be sitused to 1255
the municipal corporation in which the real estate is located. Net 1256
profit reported by the real estate agent or broker shall be 1257
allocated to a municipal corporation based upon the ratio of the 1258
commissions the agent or broker received from the sale, purchase, 1259
or lease of real estate located in the municipal corporation to 1260
the commissions received from the sale, purchase, or lease of real 1261
estate everywhere in the taxable year.1262

       (2) An individual who is a resident of a municipal 1263
corporation that imposes a municipal income tax shall report the 1264
individual's net profit from all real estate activity on the 1265
individual's annual tax return for that municipal corporation. The 1266
individual may claim a credit for taxes the individual paid on 1267
such net profit to another municipal corporation to the extent 1268
that such a credit is allowed under the municipal income tax 1269
ordinance, or rules of the municipal corporation of residence.1270

       (G) If, in computing a taxpayer's adjusted federal taxable 1271
income, the taxpayer deducted any amount with respect to a stock 1272
option granted to an employee, and if the employee is not required 1273
to include in the employee's income any such amount or a portion 1274
thereof because it is exempted from taxation under divisions 1275
(C)(12) and (R)(1)(d) of section 718.01 of the Revised Code by a 1276
municipal corporation to which the taxpayer has apportioned a 1277
portion of its net profit, the taxpayer shall add the amount that 1278
is exempt from taxation to the taxpayer's net profit that was 1279
apportioned to that municipal corporation. In no case shall a 1280
taxpayer be required to add to its net profit that was apportioned 1281
to that municipal corporation any amount other than the amount 1282
upon which the employee would be required to pay tax were the 1283
amount related to the stock option not exempted from taxation.1284

       This division applies solely for the purpose of making an 1285
adjustment to the amount of a taxpayer's net profit that was 1286
apportioned to a municipal corporation under this section.1287

       (H) When calculating the ratios described in division (A) of 1288
this section for the purposes of that division or division (B) of 1289
this section, the owner of a disregarded entity shall include in 1290
the owner's ratios the property, payroll, and gross receipts of 1291
such disregarded entity. 1292

       Sec. 718.03. (A) As used in this section:1293

       (1) "Other payer" means any person, other than an 1294
individual's employer or the employer's agent, that pays an 1295
individual any amount included in the federal gross income of the 1296
individual.1297

       (2) "Qualifying wages" means wages, as defined in section 1298
3121(a) of the Internal Revenue Code, without regard to any wage 1299
limitations, adjusted as follows:1300

       (a) Deduct the following amounts:1301

       (i) Any amount included in wages if the amount constitutes 1302
compensation attributable to a plan or program described in 1303
section 125 of the Internal Revenue Code;1304

       (ii) For purposes of division (B) of this section, any amount 1305
included in wages if the amount constitutes payment on account of 1306
sickness or accident disability.1307

       (b) Add the following amounts:1308

       (i) Any amount not included in wages solely because the 1309
employee was employed by the employer prior to April 1, 1986;1310

        (ii) Any amount not included in wages because the amount 1311
arises from the sale, exchange, or other disposition of a stock 1312
option, the exercise of a stock option, or the sale, exchange, or 1313
other disposition of stock purchased under a stock option and the 1314
municipal corporation has not, by resolution or ordinance, 1315
exempted the amount from withholding and tax. Division 1316
(A)(2)(b)(ii) of this section applies only to those amounts 1317
constituting ordinary income.1318

        (iii) Any amount not included in wages if the amount is an 1319
amount described in section 401(k) or 457 of the Internal Revenue 1320
Code. Division (A)(2)(b)(iii) of this section applies only to 1321
employee contributions and employee deferrals.1322

       (iv) Any amount that is supplemental unemployment 1323
compensation benefits described in section 3402(o)(2) of the 1324
Internal Revenue Code and not included in wages.1325

       (c) Deduct any amount attributable to a nonqualified deferred 1326
compensation plan or program described in section 3121(v)(2)(C) of 1327
the Internal Revenue Code if the compensation is included in wages 1328
and has, by resolution or ordinance, been exempted from taxation 1329
by the municipal corporation.1330

        (d) Deduct any amount included in wages if the amount arises 1331
from the sale, exchange, or other disposition of a stock option, 1332
the exercise of a stock option, or the sale, exchange, or other 1333
disposition of stock purchased under a stock option and the 1334
municipal corporation has, by resolution or ordinance, exempted 1335
the amount from withholding and tax.1336

       (B) Except as provided in division (F) of this section, for 1337
taxable years beginning after 2003, no municipal corporation shall 1338
require any employer or any agent of any employer or any other 1339
payer, to withhold tax with respect to any amount other than 1340
qualifying wages. Nothing in this section prohibits an employer 1341
from withholding tax on a basis greater than qualifying wages.1342

       (C)Each employer, agent of an employer, or other payer 1343
located or doing business in a municipal corporation that imposes 1344
a tax on income in accordance with this chapter shall withhold 1345
from each employee an amount equal to the qualifying wages of the 1346
employee earned by the employee in the municipal corporation 1347
multiplied by the applicable rate of the municipal corporation's 1348
income tax, except for qualifying wages for which withholding is 1349
not required under section 718.011 of the Revised Code or division 1350
(D) or (F) of this section. An employer, agent of an employer, or 1351
other payer shall deduct and withhold the tax from qualifying 1352
wages on the date that the employer, agent, or other payer 1353
directly, indirectly, or constructively pays the qualifying wages 1354
to, or credits the qualifying wages to the benefit of, the 1355
employee.1356

       An employer, agent of an employer, or other payer may deduct 1357
and withhold, on the request of an employee, taxes for the 1358
municipal corporation in which the employee is a resident.1359

       (B)(1) Except as provided in division (B)(2) of this section, 1360
an employer, agent of an employer, or other payer shall remit to 1361
the tax administrator of a municipal corporation the greater of 1362
the income taxes deducted and withheld or the income taxes 1363
required to be deducted and withheld by the employer, agent, or 1364
other payer according to the following schedule:1365

       (a) Taxes required to be deducted and withheld shall be 1366
remitted monthly to the tax administrator if the total taxes 1367
deducted and withheld or required to be deducted and withheld by 1368
the employer, agent, or other payer on behalf of the municipal 1369
corporation in the preceding calendar year exceeded two thousand 1370
three hundred ninety-nine dollars, or if the total amount of taxes 1371
deducted and withheld or required to be deducted and withheld on 1372
behalf of the municipal corporation in any month of the preceding 1373
calendar quarter exceeded two hundred dollars.1374

        Payment under division (B)(1)(a) of this section shall be 1375
made so that the payment is received by the tax administrator not 1376
later than fifteen days after the last day of each month.1377

       (b) Any employer, agent of an employer, or other payer not 1378
required to make payments under division (B)(1)(a) of this section 1379
of taxes required to be deducted and withheld shall make quarterly 1380
payments to the tax administrator not later than the fifteenth day 1381
of the month following the end of the fifteenth day of each 1382
calendar quarter.1383

       (2) Notwithstanding division (B)(1) of this section, a 1384
municipal corporation may require, by resolution, ordinance, or 1385
rule, an employer, agent of an employer, or other payer to do any 1386
of the following:1387

       (a) Remit taxes deducted and withheld semimonthly to the tax 1388
administrator if the total taxes deducted and withheld or required 1389
to be deducted and withheld on behalf of the municipal corporation 1390
in the preceding calendar year exceeded eleven thousand nine 1391
hundred ninety-nine dollars, or if the total amount of taxes 1392
deducted and withheld or required to be deducted and withheld on 1393
behalf of the municipal corporation in any month of the preceding 1394
calendar year exceeded one thousand dollars. The payment under 1395
division (B)(2)(a) of this section shall be made so that the 1396
payment is received by the tax administrator not later than one of 1397
the following:1398

       (i) If the taxes were deducted and withheld or required to be 1399
deducted and withheld during the first fifteen days of a month, 1400
the third banking day after the fifteenth day of that month;1401

       (ii) If the taxes were deducted and withheld or required to 1402
be deducted and withheld after the fifteenth day of a month and 1403
before the first day of the immediately following month, the third 1404
banking day after the last day of that month.1405

       (b) Remit electronically to the tax administrator on the 1406
following business day all taxes deducted and withheld on behalf 1407
of the municipal corporation if on any day the total amount of 1408
such taxes withheld but not remitted is at least one hundred 1409
thousand dollars.1410

       (c) Make payment by electronic funds transfer to the tax 1411
administrator of all taxes deducted and withheld on behalf of the 1412
municipal corporation if the employer, agent of an employer, or 1413
other payer that is required to make payments electronically for 1414
the purpose of paying federal taxes withheld on payments to 1415
employees under section 6302 of the Internal Revenue Code, 26 1416
C.F.R. 31.6302-1, or any other federal statute or regulation. The 1417
payment of tax by electronic funds transfer under this division 1418
does not affect an employer's, agent's, or other payer's 1419
obligation to file any return as required under this section.1420

       (C) An employer, agent of an employer, or other payer shall 1421
make and file a return showing the amount of tax withheld by the 1422
employer, agent, or other payer from the qualifying wages of each 1423
employee and remitted to the tax administrator. Unless the tax 1424
administrator requires all individual taxpayers to file a tax 1425
return under section 718.05 of the Revised Code, a return filed by 1426
an employer, agent, or other payer under this division shall be 1427
accepted by a tax administrator and municipal corporation as the 1428
return required of an employee whose sole income subject to the 1429
tax under this chapter is the qualifying wages reported by the 1430
employee's employer, agent of an employer, or other payer.1431

       (D) An employer, agent of an employer, or other payer is not 1432
required to make any withholdingwithhold municipal income tax1433
with respect to an individual's disqualifying disposition of an 1434
incentive stock option if, at the time of the disqualifying 1435
disposition, the individual is not an employee of either the 1436
corporation with respect to whose stock the option has been issued 1437
or of such corporation's successor entity.1438

       (D)(E)(1) An employee is not relieved from liability for a 1439
tax by the failure of the employer, agent of an employer, or other 1440
payer to withhold the tax as required by a municipal corporation1441
under this chapter or by the employer's, agent's, or other payer's1442
exemption from the requirement to withhold the tax.1443

       (2) The failure of an employer, agent of an employer, or 1444
other payer to remit to the municipal corporation the tax withheld 1445
relieves the employee from liability for that tax unless the 1446
employee colluded with the employer, agent, or other payer in 1447
connection with the failure to remit the tax withheld.1448

       (E)(F) Compensation deferred before June 26, 2003, is not 1449
subject to any municipal corporation income tax or municipal 1450
income tax withholding requirement to the extent the deferred 1451
compensation does not constitute qualifying wages at the time the 1452
deferred compensation is paid or distributed.1453

       (F) A municipal corporation may require a casino facility or 1454
a casino operator, as defined in Section 6(C)(9) of Article XV, 1455
Ohio Constitution, and section 3772.01 of the Revised Code, 1456
respectively, or a lottery sales agent conducting video lottery 1457
terminals on behalf of the state to withhold and remit tax with 1458
respect to amounts other than qualifying wages.1459

       (G) Each employer, agent of an employer, or other payer 1460
required to withhold taxes is liable for the payment of that 1461
amount required to be withheld, whether or not such taxes have 1462
been withheld, and such amount shall be deemed to be held in trust 1463
for the municipal corporation until such time as the withheld 1464
amount is remitted to the tax administrator.1465

       (H) On or before the last day of February of each year, an 1466
employer shall file a withholding reconciliation return with the 1467
tax administrator listing the names, addresses, and social 1468
security numbers of all employees from whose qualifying wages tax 1469
was withheld or should have been withheld for the municipal 1470
corporation during the preceding calendar year and of all 1471
employees from whose qualifying wages tax was not withheld for the 1472
municipal corporation during the preceding calendar year as a 1473
result of those wages qualifying as exempt income under division 1474
(C)(16) of section 718.01 of the Revised Code, the amount of tax 1475
withheld, if any, from each such employee, the total amount of 1476
qualifying wages paid to such employee during the preceding 1477
calendar year, and other information as may be required by the tax 1478
administrator.1479

       (I) The officer or the employee of the employer, agent of an 1480
employer, or other payer with control or direct supervision of or 1481
charged with the responsibility for withholding the tax or filing 1482
the reports and making payments as required by this section, shall 1483
be personally liable for a failure to file a report or pay the tax 1484
due as required by this section. The dissolution of an employer, 1485
agent of an employer, or other payer does not discharge the 1486
officer's or employee's liability for a failure of the employer, 1487
agent of an employer, or other payer to file returns or pay any 1488
tax due.1489

       (J) An employer is required to deduct and withhold municipal 1490
income tax on tips and gratuities received by the employer's 1491
employees and constituting qualifying wages only to the extent 1492
that the tips and gratuities are under the employer's control. For 1493
the purposes of this division, a tip or gratuity is under the 1494
employer's control if the tip or gratuity is paid by the customer 1495
to the employer for subsequent remittance to the employee, or if 1496
the customer pays the tip or gratuity by credit card, debit card, 1497
or other electronic means.1498

       (K) A tax administrator shall consider any tax withheld by an 1499
employer at the request of an employee when such tax is not 1500
otherwise required to be withheld by this chapter to be tax 1501
required to be withheld and remitted for the purposes of this 1502
section.1503

       Sec. 718.031. (A) A municipal corporation shall require a 1504
casino facility or a casino operator, as defined in Section 1505
6(C)(9) of Article XV, Ohio Constitution, and section 3772.01 of 1506
the Revised Code, respectively, or a lottery sales agent 1507
conducting video lottery terminals on behalf of the state to 1508
withhold and remit municipal income tax with respect to amounts 1509
other than qualifying wages as provided in this section.1510

       (B) If a person's winnings at a casino facility are an amount 1511
for which reporting to the internal revenue service of the amount 1512
is required by section 6041 of the Internal Revenue Code, as 1513
amended, the casino operator shall deduct and withhold municipal 1514
income tax from the person's winnings at the rate of the tax 1515
imposed by the municipal corporation in which the casino facility 1516
is located. 1517

       (C) Amounts deducted and withheld by a casino operator are 1518
held in trust for the benefit of the municipal corporation to 1519
which the tax is owed.1520

       (1) On or before the tenth day of each month, the casino 1521
operator shall file a return electronically with the tax 1522
administrator of the municipal corporation, identifying the person 1523
from whose winnings amounts were deducted and withheld, the amount 1524
of each such deduction and withholding during the preceding 1525
calendar month, the amount of the winnings from which each such 1526
amount was withheld, the type of casino gaming that resulted in 1527
such winnings, and any other information required by the tax 1528
administrator. With this return, the casino operator shall remit 1529
electronically to the municipal corporation all amounts deducted 1530
and withheld during the preceding month.1531

       (2) Annually, on or before the thirty-first day of January, a 1532
casino operator shall file an annual return electronically with 1533
the tax administrator of the municipal corporation in which the 1534
casino facility is located, indicating the total amount deducted 1535
and withheld during the preceding calendar year. The casino 1536
operator shall remit electronically with the annual return any 1537
amount that was deducted and withheld and that was not previously 1538
remitted. If the identity of a person and the amount deducted and 1539
withheld with respect to that person were omitted on a monthly 1540
return for that reporting period, that information shall be 1541
indicated on the annual return.1542

       (3) Annually, on or before the thirty-first day of January, a 1543
casino operator shall issue an information return to each person 1544
with respect to whom an amount has been deducted and withheld 1545
during the preceding calendar year. The information return shall 1546
show the total amount of municipal income tax deducted from the 1547
person's winnings during the preceding year. The casino operator 1548
shall provide to the tax administrator a copy of each information 1549
return issued under this division. The administrator may require 1550
that such copies be transmitted electronically.1551

       (4) A casino operator that fails to file a return and remit 1552
the amounts deducted and withheld shall be personally liable for 1553
the amount withheld and not remitted. Such personal liability 1554
extends to any penalty and interest imposed for the late filing of 1555
a return or the late payment of tax deducted and withheld.1556

       (5) If a casino operator sells the casino facility or 1557
otherwise quits the casino business, the amounts deducted and 1558
withheld along with any penalties and interest thereon are 1559
immediately due and payable. The successor shall withhold an 1560
amount of the purchase money that is sufficient to cover the 1561
amounts deducted and withheld along with any penalties and 1562
interest thereon until the predecessor casino operator produces 1563
either of the following:1564

       (a) A receipt from the tax administrator showing that the 1565
amounts deducted and withheld and penalties and interest thereon 1566
have been paid;1567

       (b) A certificate from the tax administrator indicating that 1568
no amounts are due.1569

       If the successor fails to withhold purchase money, the 1570
successor is personally liable for the payment of the amounts 1571
deducted and withheld and penalties and interest thereon. 1572

       (6) The failure of a casino operator to deduct and withhold 1573
the required amount from a person's winnings does not relieve that 1574
person from liability for the municipal income tax with respect to 1575
those winnings.1576

       (D) If a person's prize award from a video lottery terminal 1577
is an amount for which reporting to the internal revenue service 1578
is required by section 6041 of the Internal Revenue Code, as 1579
amended, the video lottery sales agent shall deduct and withhold 1580
municipal income tax from the person's prize award at the rate of 1581
the tax imposed by the municipal corporation in which the video 1582
lottery terminal facility is located. 1583

       (E) Amounts deducted and withheld by a video lottery sales 1584
agent are held in trust for the benefit of the municipal 1585
corporation to which the tax is owed.1586

       (1) The video lottery sales agent shall issue to a person 1587
from whose prize award an amount has been deducted and withheld a 1588
receipt for the amount deducted and withheld, and shall obtain 1589
from the person receiving a prize award the person's name, 1590
address, and social security number in order to facilitate the 1591
preparation of returns required by this section.1592

       (2) On or before the tenth day of each month, the video 1593
lottery sales agent shall file a return electronically with the 1594
tax administrator of the municipal corporation identifying the 1595
persons from whose prize awards amounts were deducted and 1596
withheld, the amount of each such deduction and withholding during 1597
the preceding calendar month, the amount of the prize award from 1598
which each such amount was withheld, and any other information 1599
required by the tax administrator. With the return, the video 1600
lottery sales agent shall remit electronically to the tax 1601
administrator all amounts deducted and withheld during the 1602
preceding month.1603

       (3) A video lottery sales agent shall maintain a record of 1604
all receipts issued under division (E) of this section and shall 1605
make those records available to the tax administrator upon 1606
request. Such records shall be maintained in accordance with 1607
section 5747.17 of the Revised Code and any rules adopted pursuant 1608
thereto.1609

       (4) Annually, on or before the thirty-first day of January, 1610
each video lottery terminal sales agent shall file an annual 1611
return electronically with the tax administrator of the municipal 1612
corporation in which the facility is located indicating the total 1613
amount deducted and withheld during the preceding calendar year. 1614
The video lottery sales agent shall remit electronically with the 1615
annual return any amount that was deducted and withheld and that 1616
was not previously remitted. If the identity of a person and the 1617
amount deducted and withheld with respect to that person were 1618
omitted on a monthly return for that reporting period, that 1619
information shall be indicated on the annual return.1620

       (5) Annually, on or before the thirty-first day of January, a 1621
video lottery sales agent shall issue an information return to 1622
each person with respect to whom an amount has been deducted and 1623
withheld during the preceding calendar year. The information 1624
return shall show the total amount of municipal income tax 1625
deducted and withheld from the person's prize award by the video 1626
lottery sales agent during the preceding year. A video lottery 1627
sales agent shall provide to the tax administrator of the 1628
municipal corporation a copy of each information return issued 1629
under this division. The tax administrator may require that such 1630
copies be transmitted electronically.1631

       (6) A video lottery sales agent who fails to file a return 1632
and remit the amounts deducted and withheld is personally liable 1633
for the amount deducted and withheld and not remitted. Such 1634
personal liability extends to any penalty and interest imposed for 1635
the late filing of a return or the late payment of tax deducted 1636
and withheld.1637

       (F) If a video lottery sales agent ceases to operate video 1638
lottery terminals, the amounts deducted and withheld along with 1639
any penalties and interest thereon are immediately due and 1640
payable. The successor of the video lottery sales agent that 1641
purchases the video lottery terminals from the agent shall 1642
withhold an amount from the purchase money that is sufficient to 1643
cover the amounts deducted and withheld and any penalties and 1644
interest thereon until the predecessor video lottery sales agent 1645
operator produces either of the following:1646

       (1) A receipt from the tax administrator showing that the 1647
amounts deducted and withheld and penalties and interest thereon 1648
have been paid;1649

       (2) A certificate from the tax administrator indicating that 1650
no amounts are due.1651

       If the successor fails to withhold purchase money, the 1652
successor is personally liable for the payment of the amounts 1653
deducted and withheld and penalties and interest thereon. 1654

       (G) The failure of a video lottery sales agent to deduct and 1655
withhold the required amount from a person's prize award does not 1656
relieve that person from liability for the municipal income tax 1657
with respect to that prize award.1658

       (H) The tax administrator of a municipal corporation may 1659
impose a penalty of up to one thousand dollars if a casino 1660
operator or video lottery sales agent files a return late, fails 1661
to file a return, remits amounts deducted and withheld late, or 1662
fails to remit amounts deducted and withheld as required under 1663
this section. Interest shall accrue on past due amounts deducted 1664
and withheld at the rate prescribed in section 5703.47 of the 1665
Revised Code.1666

       (I) Amounts deducted and withheld on behalf of a municipal 1667
corporation shall be allowed as a credit against payment of the 1668
tax imposed by the municipal corporation and shall be treated as 1669
taxes paid for purposes of section 718.08 of the Revised Code. 1670
This division applies only to the person for whom the amount is 1671
deducted and withheld.1672

       (J) The tax administrator shall prescribe the forms of the 1673
receipts and returns required under this section.1674

       Sec. 718.04. (A) A municipal corporation may levy a tax on 1675
income only in accordance with the limitations specified in this 1676
chapter. On or after January 1, 2015, the ordinance or resolution 1677
levying the tax, as adopted or amended by the legislative 1678
authority of the municipal corporation, shall include all of the 1679
following:1680

        (1) A statement that the tax is an annual tax levied on the 1681
income of every person residing in or earning or receiving income 1682
in the municipal corporation and that the tax shall be measured by 1683
municipal taxable income;1684

        (2) A statement that the municipal corporation is levying the 1685
tax in accordance with the limitations specified in this chapter 1686
and that the resolution or ordinance thereby incorporates the 1687
provisions of this chapter;1688

        (3) The rate of the tax;1689

        (4) Whether, and the extent to which, a credit, as described 1690
in division (D) of this section, will be allowed against the tax;1691

        (5) The purpose or purposes of the tax;1692

        (6) Any other provision necessary for the administration of 1693
the tax, provided that the provision does not conflict with any 1694
provision of this chapter.1695

        (B) Any municipal corporation that, on or before the 1696
effective date of the enactment of this section, levies an income 1697
tax at a rate in excess of one per cent may continue to levy the 1698
tax at the rate specified in the original ordinance or resolution, 1699
provided that such rate continues in effect as specified in the 1700
original ordinance or resolution.1701

        (C)(1) No municipal corporation shall tax income at other 1702
than a uniform rate.1703

        (2) Except as provided in division (B) of this section, no 1704
municipal corporation shall levy a tax on income at a rate in 1705
excess of one per cent without having obtained the approval of the 1706
excess by a majority of the electors of the municipality voting on 1707
the question at a general, primary, or special election. The 1708
legislative authority of the municipal corporation shall file with 1709
the board of elections at least ninety days before the day of the 1710
election a copy of the ordinance together with a resolution 1711
specifying the date the election is to be held and directing the 1712
board of elections to conduct the election. The ballot shall be in 1713
the following form: "Shall the Ordinance providing for a ... per 1714
cent levy on income for (Brief description of the purpose of the 1715
proposed levy) be passed?1716

        1717

  FOR THE INCOME TAX 1718
  AGAINST THE INCOME TAX  " 1719

         1720

In the event of an affirmative vote, the proceeds of the levy may 1721
be used only for the specified purpose.1722

        (D) A municipal corporation may, by ordinance or resolution, 1723
grant a credit to residents of the municipal corporation for all 1724
or a portion of the taxes paid to other municipal corporations, in 1725
this state or elsewhere, by the resident or by a pass-through 1726
entity owned, directly or indirectly, by a resident, on the 1727
resident's distributive or proportionate share of the income of 1728
the pass-through entity. A municipal corporation is not required 1729
to refund taxes not paid to the municipal corporation.1730

        (E) Except as otherwise provided in this chapter, a municipal 1731
corporation that levies an income tax in effect for taxable years 1732
beginning before January 1, 2015, may continue to administer and 1733
enforce the provisions of such tax for all taxable years beginning 1734
before January 1, 2015, provided that the provisions of such tax 1735
are consistent with this chapter as it existed prior to the 1736
effective date of the enactment of this section.1737

        (F) Nothing in this chapter authorizes a municipal 1738
corporation to levy a tax on income or net profit, or to 1739
administer or collect such a tax or penalties or interest related 1740
to such a tax, contrary to the limitations specified in this 1741
chapter.1742

       Sec. 718.05. An annual return with respect to the income tax 1743
levied by a municipal corporation shall be completed and filed by 1744
every taxpayer for any taxable year for which the taxpayer is 1745
liable for the tax. If the total credit allowed against the tax as 1746
described in division (D) of section 718.04 of the Revised Code 1747
for the year is equal to or exceeds the tax imposed by the 1748
municipal corporation, no return shall be required unless the 1749
municipal ordinance or resolution levying the tax requires the 1750
filing of a return in such circumstances.1751

       (A) If an individual is deceased, any return or notice 1752
required of that individual shall be completed and filed by that 1753
decedent's executor, administrator, or other person charged with 1754
the property of that decedent.1755

       (B) If an individual is unable to complete and file a return 1756
or notice required by a municipal corporation in accordance with 1757
this chapter, the return or notice required of that individual 1758
shall be completed and filed by the individual's duly authorized 1759
agent, guardian, conservator, fiduciary, or other person charged 1760
with the care of the person or property of that individual. 1761

       (C) Returns or notices required of an estate or a trust shall 1762
be completed and filed by the fiduciary of the estate or trust.1763

       (D) No municipal corporation shall deny spouses the ability 1764
to file a joint return.1765

       (E)(1) Each return required to be filed under this section 1766
shall contain the signature of the taxpayer or the taxpayer's duly 1767
authorized agent and of the person who prepared the return for the 1768
taxpayer, and shall include the taxpayer's social security number 1769
or taxpayer identification number. Each return shall be verified 1770
by a declaration under penalty of perjury.1771

       (2) A tax administrator may require any taxpayer who is an 1772
individual to include, with each annual return, amended return, or 1773
application for refund required under this section, complete 1774
copies of any of the following that are applicable to the 1775
taxpayer: all of the taxpayer's Internal Revenue Service form W-2, 1776
"Wage and Tax Statements," including all information reported on 1777
the taxpayer's federal W-2, as well as taxable wages reported or 1778
withheld for any municipal corporation; any Internal Revenue 1779
Service form 1099-MISC received by the taxpayer, schedule K1, form 1780
2106, schedule C, schedule E, and schedule F; and pages one and 1781
two of the taxpayer's Internal Revenue Service form 1040. An 1782
individual taxpayer who files the annual return required by this 1783
section electronically shall provide paper copies of any of the 1784
foregoing to the tax administrator upon the tax administrator's 1785
request.1786

       (3) A tax administrator may require any taxpayer that is not 1787
an individual to include, with each annual net profit return, 1788
amended net profit return, or application for refund required 1789
under this section, complete copies of any of the following that 1790
are applicable to the taxpayer: the taxpayer's Internal Revenue 1791
Service form 1041, form 1065, form 1120, form 1120-REIT, form 1792
1120F, form 1120S, schedule D, schedule E, schedule M-3, form 1793
1125-A, form 4562, form 8825, form 8903, and form 8949; supporting 1794
statements for "other income," "taxes and licenses," "other 1795
deductions," and "other costs" reported on the foregoing forms and 1796
schedules; the method of accounting and allocation used to 1797
determine the income allocable to the municipal corporation; and, 1798
if the taxpayer is a pass-through entity, any Internal Revenue 1799
Service K-1 schedules issued or received by the taxpayer or a 1800
schedule summarizing the information contained on such K-1 1801
schedules, Internal Revenue Service forms 1096, the taxpayer's 1802
federal consolidated schedules if filing a consolidated return 1803
pursuant to section 718.06 of the Revised Code, and the taxpayer's 1804
net operating loss carry forward schedule providing for each year 1805
in which the net operating loss was sustained, the method of 1806
accounting and allocation used to determine the portion of net 1807
operating loss allocable to the taxing municipal corporation, the 1808
amount of net operating loss used as a deduction in prior years, 1809
and the amount of net operating loss claimed as a deduction in the 1810
current year.1811

        A taxpayer that is not an individual and that files an annual 1812
net profit return electronically through the Ohio business gateway 1813
or in some other manner shall either mail the documents required 1814
under this division to the tax administrator at the time of filing 1815
or, if electronic submission is available, submit the documents 1816
electronically through the Ohio business gateway. The department 1817
of taxation shall publish a method of electronically submitting 1818
the documents required under this division through the Ohio 1819
business gateway on or before January 1, 2015. The department 1820
shall transmit all documents submitted electronically under this 1821
division to the appropriate tax administrator.1822

       (4) A tax administrator may require that each annual 1823
withholding reconciliation return required to be filed under this 1824
chapter include complete copies of any of the following that are 1825
applicable: an information return for each employee from whom 1826
municipal income tax has been withheld that specifies the 1827
municipal corporation for which the tax is withheld and all 1828
information required for federal income tax reporting purposes on 1829
Internal Revenue Service form W-2 or its equivalent.1830

       (5) Pursuant to section 718.24 of the Revised Code, the tax 1831
administrator may request, and the taxpayer shall provide, any 1832
information, statements, or documents required by the municipal 1833
corporation to determine and verify the taxpayer's municipal 1834
income tax liability. The requirements imposed under division (E) 1835
of this section apply regardless of whether the taxpayer files on 1836
a generic form or on a form prescribed by the tax administrator.1837

       (F)(1) Except as otherwise provided in this chapter, each 1838
return required to be filed under this section shall be completed 1839
and filed as required by the tax administrator on or before the 1840
date prescribed for the filing of federal individual income tax 1841
returns and notices under section 6072(a) of the Internal Revenue 1842
Code. The taxpayer shall complete and file the return or notice on 1843
forms prescribed by the tax administrator or on generic forms, 1844
together with remittance made payable to the municipal corporation 1845
or tax administrator. No remittance is required if the amount 1846
shown to be due is ten dollars or less.1847

       (2) Any taxpayer that has requested an extension for filing a 1848
federal income tax return may request an extension for the filing 1849
of a municipal income tax return. The taxpayer shall make the 1850
request by filing a copy of the taxpayer's request for a federal 1851
filing extension through the Ohio business gateway or directly 1852
with the tax administrator. The request for extension shall be 1853
filed not later than the last day for filing the municipal income 1854
tax return. The extended due date of the municipal income tax 1855
return shall be the last day of the month following the month to 1856
which the due date of the federal income tax return has been 1857
extended. A municipal corporation may deny a taxpayer's request 1858
for extension only if the taxpayer fails to timely file the 1859
request, fails to file a copy of the request for the federal 1860
extension, owes the municipal corporation any delinquent income 1861
tax, penalty, or interest, or has failed to file any required 1862
income tax return for a prior tax period. An extension of time to 1863
file under this division is not an extension of the time to pay 1864
any tax due unless the tax administrator grants an extension of 1865
that date.1866

        (3) If a taxpayer does not request and obtain a federal 1867
extension as described in division (F)(2) of this section, the 1868
taxpayer may request an extension of time to file a municipal 1869
income tax return by filing the request through the Ohio business 1870
gateway or directly with the tax administrator of the municipal 1871
corporation with which the return is required to be filed. The 1872
request for extension shall be filed not later than the last day 1873
for filing the municipal income tax return. The extended due date 1874
of the municipal income tax return shall be the last day of the 1875
month following the month to which the due date of the federal 1876
income tax return has been extended.1877

       Upon good cause shown, the tax administrator may extend the 1878
period for filing any notice or return.1879

       (4) In order to facilitate the filing of extension requests, 1880
the tax commissioner and the Ohio business gateway steering 1881
committee shall take all steps necessary to provide taxpayers with 1882
the ability to file such requests through the Ohio business 1883
gateway and to notify tax administrators when such requests are 1884
filed.1885

        (5) If the tax administrator considers it necessary in order 1886
to ensure the payment of the tax imposed by the municipal 1887
corporation in accordance with this chapter, the tax administrator 1888
may require taxpayers to file returns and make payments otherwise 1889
than as provided in this section, including taxpayers not 1890
otherwise required to file annual returns.1891

       (6) To the extent that any provision in this division 1892
conflicts with any provision in section 718.052 of the Revised 1893
Code, the provision in that section prevails.1894

       (G)(1) For taxable years beginning after 2014, a municipal 1895
corporation shall not require a taxpayer to remit tax with respect 1896
to net profits if the amount due is less than ten dollars.1897

        (2) Any taxpayer not required to remit tax to a municipal 1898
corporation for a taxable year pursuant to division (G)(1) of this 1899
section shall file with the municipal corporation an annual net 1900
profit return under division (E)(3) of this section.1901

       (H) This division shall not apply to payments required to be 1902
made under division (B)(1)(a) or (2)(a) of section 718.03 of the 1903
Revised Code. Except as provided in section 718.08 of the Revised 1904
Code:1905

       (1) If any report, claim, statement, or other document 1906
required to be filed, or any payment required to be made, within a 1907
prescribed period or on or before a prescribed date under this 1908
chapter is delivered after that period or that date by United 1909
States mail to the tax administrator or other municipal official 1910
with which the report, claim, statement, or other document is 1911
required to be filed, or to which the payment is required to be 1912
made, the date of the postmark stamped on the cover in which the 1913
report, claim, statement, or other document, or payment is mailed 1914
shall be deemed to be the date of delivery or the date of payment. 1915
"The date of postmark" means, in the event there is more than one 1916
date on the cover, the earliest date imprinted on the cover by the 1917
postal service.1918

       (2) If a payment is required to be made by electronic funds 1919
transfer, the payment is considered to be made when the payment is 1920
credited to an account designated by the tax administrator for the 1921
receipt of tax payments, except that, when a payment made by 1922
electronic funds transfer is delayed due to circumstances not 1923
under the control of the taxpayer, the payment is considered to be 1924
made when the taxpayer submitted the payment.1925

       (I) The amounts withheld by an employer, the agent of an 1926
employer, or an other payer as described in section 718.03 of the 1927
Revised Code shall be allowed to the recipient of the compensation 1928
as credits against payment of the tax imposed on the recipient by 1929
the municipal corporation, unless the amounts withheld were not 1930
remitted to the municipal corporation and the recipient colluded 1931
with the employer, agent, or other payer in connection with the 1932
failure to remit the amounts withheld.1933

       (J) Each return required by a municipal corporation to be 1934
filed in accordance with this section shall include a box that the 1935
taxpayer may check to authorize another person, including a tax 1936
return preparer who prepared the return, to communicate with the 1937
tax administrator about matters pertaining to the return. The 1938
return or instructions accompanying the return shall indicate that 1939
by checking the box the taxpayer authorizes the tax administrator 1940
to contact the preparer or other person concerning questions that 1941
arise during the examination or other review of the return and 1942
authorizes the preparer or other person only to provide the tax 1943
administrator with information that is missing from the return, to 1944
contact the tax administrator for information about the 1945
examination or other review of the return or the status of the 1946
taxpayer's refund or payments, and to respond to notices about 1947
mathematical errors, offsets, or return preparation that the 1948
taxpayer has received from the tax administrator and has shown to 1949
the preparer or other person.1950

       (K) The tax administrator of a municipal corporation shall 1951
accept for filing a generic form of any income tax return, report, 1952
or document required by the municipal corporation in accordance 1953
with this chapter, provided that the generic form, once completed 1954
and filed, contains all of the information required by ordinance, 1955
resolution, or rules adopted by the municipal corporation or tax 1956
administrator, and provided that the taxpayer or tax return 1957
preparer filing the generic form otherwise complies with the 1958
provisions of this chapter and of the municipal corporation 1959
ordinance or resolution governing the filing of returns, reports, 1960
or documents.1961

        (L) When income tax returns, reports, or other documents 1962
require the signature of a tax return preparer, the tax 1963
administrator shall accept a facsimile of such a signature in lieu 1964
of a manual signature.1965

       Sec. 718.051. (A) As used in this section, "Ohio business 1966
gateway" means the online computer network system, initially 1967
created by the department of administrative services under section 1968
125.30 of the Revised Code, that allows private businesses to 1969
electronically file business reply forms with state agencies and 1970
includes any successor electronic filing and payment system.1971

       (B) Notwithstanding section 718.05 of the Revised Code, on 1972
and after January 1, 2005, any taxpayer that is subject to any 1973
municipal corporation's tax on the net profit from a business or 1974
profession and has received an extension to file the federal 1975
income tax return shall not be required to notify the municipal 1976
corporation of the federal extension and shall not be required to 1977
file any municipal income tax return until the last day of the 1978
month to which the due date for filing the federal return has been 1979
extended, provided that, on or before the date for filing the 1980
municipal income tax return, the person notifies the tax 1981
commissioner of the federal extension through the Ohio business 1982
gateway. An extension of time to file is not an extension of the 1983
time to pay any tax due.1984

       (C) For taxable years beginning on or after January 1, 2005, 1985
aAny taxpayer subject to any municipal corporation's tax on1986
income taxation with respect to the taxpayer's net profit from a 1987
business or profession may file any municipal income tax return 1988
or, estimated municipal income tax return, or extension for filing 1989
a municipal income tax return, and may make payment of amounts 1990
shown to be due on such returns, by using the Ohio business 1991
gateway.1992

       (D)(1) As used in this division, "qualifying wages" has the 1993
same meaning as in section 718.03 of the Revised Code.1994

       (2)(B) Any employer, agent of an employer, or other payer may 1995
report the amount of municipal income tax withheld from qualifying 1996
wages paid on or after January 1, 2007, and may make remittance of 1997
such amounts, by using the Ohio business gateway.1998

       (E)(C) Nothing in this section affects the due dates for 1999
filing employer withholding tax returns.2000

       (F)(D) No municipal corporation shall be required to pay any 2001
fee or charge for the operation or maintenance of the Ohio 2002
business gateway.2003

       (G)(E) The use of the Ohio business gateway by municipal 2004
corporations, taxpayers, or other persons pursuant to this section 2005
does not affect the legal rights of municipalities or taxpayers as 2006
otherwise permitted by law. This state shall not be a party to the 2007
administration of municipal income taxes or to an appeal of a 2008
municipal income tax matter, except as otherwise specifically 2009
provided by law.2010

       (H)(F)(1) The tax commissioner shall adopt rules 2011
establishing:2012

        (a) The format of documents to be used by taxpayers to file 2013
returns and make payments through the Ohio business gateway; and2014

        (b) The information taxpayers must submit when filing 2015
municipal income tax returns through the Ohio business gateway.2016

       The commissioner shall not adopt rules under this division 2017
that conflict with the requirements of section 718.05 of the 2018
Revised Code.2019

        (2) The commissioner shall consult with the Ohio business 2020
gateway steering committee before adopting the rules described in 2021
division (H)(F)(1) of this section.2022

       (I)(G) Nothing in this section shall be construed as limiting 2023
or removing the abilityauthority of any municipal corporation to 2024
administer, audit, and enforce the provisions of its municipal 2025
income tax.2026

       (H) Within sixty days after a request by a tax administrator, 2027
the tax commissioner shall provide to the tax administrator any 2028
municipal income tax data the commissioner has acquired under 2029
Chapter 5745. of the Revised Code. The tax commissioner may not 2030
impose a fee or charge to defray the costs of providing such data, 2031
including costs associated with the inspection, review, 2032
production, photocopying, or transmission of that data.2033

       Sec. 718.052.  (A) Each member of the national guard of any 2034
state and each member of a reserve component of the armed forces 2035
of the United States called to active duty pursuant to an 2036
executive order issued by the president of the United States or an 2037
act of the congress of the United States, and each civilian 2038
serving as support personnel in a combat zone or contingency 2039
operation in support of the armed forces, may apply to the tax 2040
administrator of a municipal corporation for both an extension of 2041
time for filing of the return and an extension of time for payment 2042
of taxes required by the municipal corporation in accordance with 2043
this chapter during the period of the member's or civilian's duty 2044
service and for one hundred eighty days thereafter. The 2045
application shall be filed on or before the one hundred eightieth 2046
day after the member's or civilian's duty terminates. An applicant 2047
shall provide such evidence as the tax administrator considers 2048
necessary to demonstrate eligibility for the extension.2049

       (B)(1) If the tax administrator ascertains that an applicant 2050
is qualified for an extension under this section, the tax 2051
administrator shall enter into a contract with the applicant for 2052
the payment of the tax in installments that begin on the one 2053
hundred eighty-first day after the applicant's active duty or 2054
service terminates. Except as provided in division (B)(3) of this 2055
section, the tax administrator may prescribe such contract terms 2056
as the tax administrator considers appropriate.2057

       (2) If the tax administrator ascertains that an applicant is 2058
qualified for an extension under this section, the applicant shall 2059
neither be required to file any return, report, or other tax 2060
document nor be required to pay any tax otherwise due to the 2061
municipal corporation before the one hundred eighty-first day 2062
after the applicant's active duty or service terminates.2063

       (3) Taxes paid pursuant to a contract entered into under 2064
division (B)(1) of this section are not delinquent. The tax 2065
administrator shall not require any payments of penalties or 2066
interest in connection with those taxes for the extension period.2067

       (C)(1) Nothing in this division denies to any person 2068
described in this division the application of divisions (A) and 2069
(B) of this section.2070

       (2)(a) A qualifying taxpayer who is eligible for an extension 2071
under the Internal Revenue Code shall receive both an extension of 2072
time in which to file any return, report, or other tax document 2073
and an extension of time in which to make any payment of taxes 2074
required by a municipal corporation in accordance with this 2075
chapter. The length of any extension granted under division 2076
(C)(2)(a) of this section shall be equal to the length of the 2077
corresponding extension that the taxpayer receives under the 2078
Internal Revenue Code. As used in this section, "qualifying 2079
taxpayer" means a member of the national guard, or a member of the 2080
reserve component of the armed forces of the United States, who is 2081
called to active duty pursuant to either an executive order issued 2082
by the president of the United States or an act of the congress of 2083
the United States.2084

       (b) Taxes whose payment is extended in accordance with 2085
division (C)(2)(a) of this section are not delinquent during the 2086
extension period. Such taxes become delinquent on the first day 2087
after the expiration of the extension period if the taxes are not 2088
paid prior to that date. The tax administrator shall not require 2089
any payment of penalties or interest in connection with those 2090
taxes for the extension period. The tax administrator shall not 2091
include any period of extension granted under division (C)(2)(a) 2092
of this section in calculating the penalty or interest due on any 2093
unpaid tax.2094

       (D) For each taxable year to which division (A), (B), or (C) 2095
of this section applies to a taxpayer, the provisions of divisions 2096
(B)(2) and (3) or (C) of this section, as applicable, apply to the 2097
spouse of that taxpayer if the filing status of the spouse and the 2098
taxpayer is married filing jointly for that year.2099

       Sec. 718.06. (A) As used in this section:2100

       (1) "Affiliated group of corporations" means an affiliated 2101
group as defined in section 1504 of the Internal Revenue Code. 2102
"Affiliated group of corporations" does not include an incumbent 2103
local exchange carrier primarily engaged in the business of 2104
providing local exchange telephone service in this state, or any 2105
member of such a carrier's affiliated group that is an incumbent 2106
local exchange carrier primarily engaged in the business of 2107
providing local exchange telephone service, other than cellular 2108
radio service, outside this state.2109

       (2) "Consolidated federal income tax return" means a 2110
consolidated return filed for federal income tax purposes pursuant 2111
to section 1501 of the Internal Revenue Code.2112

       (3) "Consolidated federal taxable income" means the 2113
consolidated taxable income of an affiliated group of 2114
corporations, as computed for the purposes of filing a 2115
consolidated federal income tax return, before consideration of 2116
net operating losses or special deductions. "Consolidated federal 2117
taxable income" does not include income or loss of an incumbent 2118
local exchange carrier primarily engaged in the business of 2119
providing local exchange telephone service in this state, or 2120
income or loss of any member of such a carrier's affiliated group 2121
that is an incumbent local exchange carrier primarily engaged in 2122
the business of providing local exchange telephone service, other 2123
than cellular radio service, outside this state.2124

       (4) "Incumbent local exchange carrier" has the same meaning 2125
as in section 4927.01 of the Revised Code.2126

       (5) "Local exchange telephone service" has the same meaning 2127
as in section 5727.01 of the Revised Code.2128

       (B)(1) For taxable years beginning on or after January 1, 2129
2015, a taxpayer that is a member of an affiliated group of 2130
corporations may elect to file a consolidated municipal income tax 2131
return for a taxable year if at least one member of the affiliated 2132
group of corporations is subject to the municipal income tax in 2133
that taxable year and if the affiliated group of corporations 2134
filed a consolidated federal income tax return with respect to 2135
that taxable year. The election is binding for a five-year period 2136
beginning with the first taxable year of the initial election 2137
unless a change in the reporting method is required under federal 2138
law. The election continues to be binding for each subsequent 2139
five-year period unless the taxpayer elects to discontinue filing 2140
consolidated municipal income tax returns under division (B)(2) of 2141
this section or a taxpayer receives permission from the tax 2142
administrator. The tax administrator shall approve such a request 2143
for good cause shown. 2144

       (2) An election to discontinue filing consolidated municipal 2145
income tax returns under this section must be made in the first 2146
year following the last year of a five-year consolidated municipal 2147
income tax return election period in effect under division (B)(1) 2148
of this section. The election to discontinue filing a consolidated 2149
municipal income tax return is binding for a five-year period 2150
beginning with the first taxable year of the election.2151

       (3) An election made under division (B)(1) or (2) of this 2152
section is binding on all members of the affiliated group of 2153
corporations subject to a municipal income tax.2154

       (C) A taxpayer that is a member of an affiliated group of 2155
corporations that filed a consolidated federal income tax return 2156
for a taxable year shall file a consolidated municipal income tax 2157
return for that taxable year if the tax administrator determines, 2158
by a preponderance of the evidence, that intercompany transactions 2159
have not been conducted at arm's length or that there has been a 2160
distortive shifting of income or expenses with regard to 2161
allocation of net profits to the municipal corporation. A taxpayer 2162
that is required to file a consolidated municipal income tax 2163
return for a taxable year shall file a consolidated municipal 2164
income tax return for all subsequent taxable years unless the 2165
taxpayer receives written permission from the tax administrator to 2166
file a separate return or a taxpayer has experienced a change in 2167
circumstances.2168

       (D) A taxpayer shall prepare a consolidated municipal income 2169
tax return in the same manner as is required under the United 2170
States department of treasury regulations that prescribe 2171
procedures for the preparation of the consolidated federal income 2172
tax return required to be filed by the common parent of the 2173
affiliated group of which the taxpayer is a member.2174

       (E)(1) Except as otherwise provided in divisions (E)(2) and 2175
(3) of this section, corporations that file a consolidated 2176
municipal income tax return shall compute adjusted federal taxable 2177
income, as defined in section 718.01 of the Revised Code, by 2178
substituting "consolidated federal taxable income" for "federal 2179
taxable income" wherever "federal taxable income" appears in that 2180
division and by substituting "an affiliated group of 2181
corporation's" for "a C corporation's" wherever "a C 2182
corporation's" appears in that division.2183

       (2) No corporation filing a consolidated municipal income tax 2184
return shall make any adjustment otherwise required under division 2185
(E) of section 718.01 of the Revised Code to the extent that the 2186
item of income or deduction otherwise subject to the adjustment 2187
has been eliminated or consolidated in the computation of 2188
consolidated federal taxable income.2189

       (3) If the net profit or loss of a pass-through entity is 2190
included in an affiliated group of corporations' consolidated 2191
federal taxable income for a taxable year, the corporation filing 2192
a consolidated municipal income tax return shall do one of the 2193
following with respect to that pass-through entity's net profit or 2194
loss for that taxable year:2195

       (a) Exclude the pass-through entity's net profit or loss from 2196
the consolidated federal taxable income of the affiliated group 2197
and, for the purpose of making the computations required in 2198
section 718.02 of the Revised Code, exclude the property, payroll, 2199
and gross receipts of the pass-through entity in the computation 2200
of the affiliated group's net profit sitused to a municipal 2201
corporation. If the entity's net profit or loss is so excluded, 2202
the entity shall be subject to taxation as a separate taxpayer on 2203
the basis of the entity's net profits that would otherwise be 2204
included in the consolidated federal taxable income of the 2205
affiliated group.2206

       (b) Include the pass-through entity's net profit or loss in 2207
the consolidated federal taxable income of the affiliated group 2208
and, for the purpose of making the computations required in 2209
section 718.02 of the Revised Code, include the property, payroll, 2210
and gross receipts of the pass-through entity in the computation 2211
of the affiliated group's net profit sitused to a municipal 2212
corporation. If the entity's net profit or loss is so included, 2213
the entity shall not be subject to taxation as a separate taxpayer 2214
on the basis of the entity's net profits that are included in the 2215
consolidated federal taxable income of the affiliated group.2216

       (F) Corporations filing a consolidated municipal income tax 2217
return shall make the computations required under section 718.02 2218
of the Revised Code by substituting "consolidated federal taxable 2219
income attributable to" for "net profit from" wherever "net profit 2220
from" appears in that section and by substituting "affiliated 2221
group of corporations" for "taxpayer" wherever "taxpayer" appears 2222
in that section.2223

       (G) Each corporation filing a consolidated municipal income 2224
tax return is jointly and severally liable for any tax, interest, 2225
penalties, fines, charges, or other amounts imposed by a municipal 2226
corporation in accordance with this chapter on the corporation, an 2227
affiliated group of which the corporation is a member for any 2228
portion of the taxable year, or any one or more members of such an 2229
affiliated group.2230

       (H) Corporations that made an election with a municipal 2231
corporation before January 1, 2015, to file a consolidated tax 2232
return with such municipal corporation in a manner similar to that 2233
provided in division (B) of this section shall continue to file 2234
consolidated tax returns in such manner for any taxable year 2235
beginning before January 1, 2020, unless the corporations obtain 2236
permission from the tax administrator to discontinue such filing.2237

       Sec. 718.07. On and after January 1, 2002, eachThe tax 2238
administrator of a municipal corporation that imposes a tax on 2239
income in accordance with this chapter shall make electronic 2240
versions of any rules or ordinances governing the tax available to 2241
the public through the internet, including, but not limited to, 2242
ordinances or rules governing the rate of tax; payment and 2243
withholding of taxes; filing any prescribed returns, reports, or 2244
other documents; dates for filing or paying taxes, including 2245
estimated taxes; penalties, interest, assessment, and other 2246
collection remedies; rights of taxpayers to appeal; and procedures 2247
for filing appeals; and a summary of taxpayers' rights and 2248
responsibilities. On and after that date, any municipal 2249
corporation that requires taxpayers to file income tax returns, 2250
reports, or other documentsThe tax administrator shall make 2251
blanks of suchany prescribed returns, reports, or documents, and 2252
any instructions pertaining thereto, available to the public 2253
electronically through the internet. Electronic versions of rules, 2254
ordinances, blanks, and instructions shall be made available2255
either by posting them on the electronic site established by the 2256
tax commissioner under section 5703.49 of the Revised Code orand, 2257
if the municipal corporation or tax administrator maintains an 2258
electronic site for the posting of such documents that is 2259
accessible through the internet, by posting them on anthat2260
electronic site established by the municipal corporation that is 2261
accessible through the internet. If a municipal corporation or tax 2262
administrator establishes such an electronic site, the municipal 2263
corporation shall incorporate an electronic link between that site 2264
and the site established pursuant to section 5703.49 of the 2265
Revised Code, and shall provide to the tax commissioner the 2266
uniform resource locator of the site established pursuant to this 2267
division.2268

       Sec. 718.08.  (A) As used in this section:2269

       (1) "Estimated taxes" means the amount that the taxpayer 2270
reasonably estimates to be the taxpayer's tax liability for a 2271
municipal corporation's income tax for the current taxable year.2272

       (2) "Tax liability" means the total taxes due to a municipal 2273
corporation for the taxable year, after allowing any credit to 2274
which the taxpayer is entitled, and after applying any estimated 2275
tax payment, withholding payment, or credit from another taxable 2276
year.2277

       (B)(1) Every taxpayer shall make a declaration of estimated 2278
taxes for the current taxable year, on the form prescribed by the 2279
tax administrator, if the amount payable as estimated taxes is 2280
more than one hundred dollars. For the purposes of this section:2281

       (a) Taxes withheld from compensation shall be considered as 2282
paid to the municipal corporation for which the taxes were 2283
withheld in equal amounts on each payment date unless the taxpayer 2284
establishes the dates on which all amounts were actually withheld, 2285
in which case the amounts withheld shall be considered as paid on 2286
the dates on which the amounts were actually withheld.2287

       (b) An overpayment of tax applied as a credit to a subsequent 2288
taxable year is deemed to be paid on the date of the postmark 2289
stamped on the cover in which the payment is mailed or, if the 2290
payment is made by electronic funds transfer, the date the payment 2291
is submitted. As used in this division, "date of the postmark" 2292
means, in the event there is more than one date on the cover, the 2293
earliest date imprinted on the cover by the postal service.2294

        (c) Taxes withheld by a casino operator or by a lottery sales 2295
agent under section 718.031 of the Revised Code are deemed to be 2296
paid to the municipal corporation for which the taxes were 2297
withheld on the date the taxes are withheld from the taxpayer's 2298
winnings. 2299

        (2) Taxpayers filing joint returns shall file joint 2300
declarations of estimated taxes. A taxpayer may amend a 2301
declaration under rules prescribed by the tax administrator. A 2302
taxpayer having a taxable year of less than twelve months shall 2303
make a declaration under rules prescribed by the tax 2304
administrator.2305

       (3) The declaration of estimated taxes shall be filed on or 2306
before the date prescribed for the filing of municipal income tax 2307
returns under division (F) of section 718.05 of the Revised Code 2308
or on or before the fifteenth day of the fourth month after the 2309
taxpayer becomes subject to tax for the first time.2310

       (4) Taxpayers reporting on a fiscal year basis shall file a 2311
declaration on or before the fifteenth day of the fourth month 2312
after the beginning of each fiscal year or period.2313

       (5) The original declaration or any subsequent amendment may 2314
be increased or decreased on or before any subsequent quarterly 2315
payment day as provided in this section.2316

       (C)(1) The required portion of the tax liability for the 2317
taxable year that shall be paid through estimated taxes made 2318
payable to the municipal corporation or tax administrator, 2319
including the application of tax refunds to estimated taxes and 2320
withholding on or before the applicable payment date, shall be as 2321
follows:2322

       (a) On or before the fifteenth day of the fourth month after 2323
the beginning of the taxable year, twenty-two and one-half per 2324
cent of the tax liability for the taxable year;2325

       (b) On or before the fifteenth day of the sixth month after 2326
the beginning of the taxable year, forty-five per cent of the tax 2327
liability for the taxable year;2328

       (c) On or before the fifteenth day of the ninth month after 2329
the beginning of the taxable year, sixty-seven and one-half per 2330
cent of the tax liability for the taxable year;2331

       (d) On or before the fifteenth day of the twelfth month of 2332
the taxable year, ninety per cent of the tax liability for the 2333
taxable year.2334

       (2) When an amended declaration has been filed, the unpaid 2335
balance shown due on the amended declaration shall be paid in 2336
equal installments on or before the remaining payment dates.2337

       (3) On or before the fifteenth day of the fourth month of the 2338
year following that for which the declaration or amended 2339
declaration was filed, an annual return shall be filed and any 2340
balance which may be due shall be paid with the return in 2341
accordance with section 718.05 of the Revised Code.2342

       (D)(1) In the case of any underpayment of any portion of a 2343
tax liability, penalty and interest shall be imposed pursuant to 2344
section 718.27 of the Revised Code upon the amount of underpayment 2345
for the period of underpayment, unless the underpayment is due to 2346
reasonable cause as described in division (E) of this section. The 2347
amount of the underpayment shall be determined as follows:2348

       (a) For the first payment of estimated taxes each year, 2349
twenty-two and one-half per cent of the tax liability, less the 2350
amount of taxes paid by the date prescribed for that payment;2351

       (b) For the second payment of estimated taxes each year, 2352
forty-five per cent of the tax liability, less the amount of taxes 2353
paid by the date prescribed for that payment;2354

       (c) For the third payment of estimated taxes each year, 2355
sixty-seven and one-half per cent of the tax liability, less the 2356
amount of taxes paid by the date prescribed for that payment;2357

       (d) For the fourth payment of estimated taxes each year, 2358
ninety per cent of the tax liability, less the amount of taxes 2359
paid by the date prescribed for that payment.2360

       (2) The period of the underpayment shall run from the day the 2361
estimated payment was required to be made to the date on which the 2362
payment is made. For purposes of this section, a payment of 2363
estimated taxes on or before any payment date shall be considered 2364
a payment of any previous underpayment only to the extent the 2365
payment of estimated taxes exceeds the amount of the payment 2366
presently required to be paid to avoid any penalty.2367

       (E)(1) An underpayment of any portion of tax liability 2368
determined under division (D) of this section shall be due to 2369
reasonable cause and the penalty imposed by this section shall not 2370
be added to the taxes for the taxable year if any of the following 2371
apply:2372

       (a) The amount of estimated taxes that were paid equals at 2373
least ninety per cent of the tax liability for the current taxable 2374
year, determined by annualizing the income received during the 2375
year up to the end of the month immediately preceding the month in 2376
which the payment is due.2377

       (b) The amount of estimated taxes that were paid equals at 2378
least one hundred per cent of the tax liability shown on the 2379
return of the taxpayer for the preceding taxable year, provided 2380
that the immediately preceding taxable year reflected a period of 2381
twelve months and the taxpayer filed a return with the municipal 2382
corporation under section 718.05 of the Revised Code for that 2383
year.2384

       (c) The taxpayer is an individual who resides in the 2385
municipal corporation but was not domiciled there on the first day 2386
of the taxable year.2387

       (2) The tax administrator may waive the requirement for 2388
filing a declaration of estimated taxes for any class of taxpayers 2389
after finding that the waiver is reasonable and proper in view of 2390
administrative costs and other factors.2391

       Sec. 718.09.  (A) This section applies to either of the 2392
following:2393

       (1) A municipal corporation that shares the same territory as 2394
a city, local, or exempted village school district, to the extent 2395
that not more than five per cent of the territory of the municipal 2396
corporation is located outside the school district and not more 2397
than five per cent of the territory of the school district is 2398
located outside the municipal corporation;2399

       (2) A municipal corporation that shares the same territory as 2400
a city, local, or exempted village school district, to the extent 2401
that not more than five per cent of the territory of the municipal 2402
corporation is located outside the school district, more than five 2403
per cent but not more than ten per cent of the territory of the 2404
school district is located outside the municipal corporation, and 2405
that portion of the territory of the school district that is 2406
located outside the municipal corporation is located entirely 2407
within another municipal corporation having a population of four 2408
hundred thousand or more according to the federal decennial census 2409
most recently completed before the agreement is entered into under 2410
division (B) of this section.2411

       (B) The legislative authority of a municipal corporation to 2412
which this section applies may propose to the electors an income 2413
tax, one of the purposes of which shall be to provide financial 2414
assistance to the school district through payment to the district 2415
of not less than twenty-five per cent of the revenue generated by 2416
the tax, except that the legislative authority may not propose to 2417
levy the income tax on the incomes of nonresident individuals. 2418
Prior to proposing the tax, the legislative authority shall 2419
negotiate and enter into a written agreement with the board of 2420
education of the school district specifying the tax rate, the 2421
percentage of tax revenue to be paid to the school district, the 2422
purpose for which the school district will use the money, the 2423
first year the tax will be levied, which shall be the first year 2424
after the year in which the levy is approved or any later year,2425
the date of the special election on the question of the tax, and 2426
the method and schedule by which the municipal corporation will 2427
make payments to the school district. The special election shall 2428
be held on a day specified in division (D) of section 3501.01 of 2429
the Revised Code, except that the special election may not be held 2430
on the day for holding a primary election as authorized by the 2431
municipal corporation's charter unless the municipal corporation 2432
is to have a primary election on that day.2433

       After the legislative authority and board of education have 2434
entered into the agreement, the legislative authority shall 2435
provide for levying the tax by ordinance. The ordinance shall 2436
include the provisions described in division (A) of section 718.04 2437
of the Revised Code and shall state the tax rate, the percentage 2438
of tax revenue to be paid to the school district, the purpose for 2439
which the municipal corporation will use its share of the tax 2440
revenue, the first year the tax will be levied, and that the 2441
question of the income tax will be submitted to the electors of 2442
the municipal corporation. The legislative authority also shall 2443
adopt a resolution specifying the regular or special election date 2444
the election will be held and directing the board of elections to 2445
conduct the election. At least ninety days before the date of the 2446
election, the legislative authority shall file certified copies of 2447
the ordinance and resolution with the board of elections.2448

       (C) The board of elections shall make the necessary 2449
arrangements for the submission of the question to the electors of 2450
the municipal corporation, and shall conduct the election in the 2451
same manner as any other municipal income tax election. Notice of 2452
the election shall be published in a newspaper of general 2453
circulation in the municipal corporation once a week for four 2454
consecutive weeks, or as provided in section 7.16 of the Revised 2455
Code, prior to the election, and shall include statements of the 2456
rate and municipal corporation and school district purposes of the 2457
income tax, the percentage of tax revenue that will be paid to the 2458
school district, and the first year the tax will be levied. The 2459
ballot shall be in the following form:2460

       "Shall the ordinance providing for a ..... per cent levy on 2461
income for (brief description of the municipal corporation and 2462
school district purposes of the levy, including a statement of the 2463
percentage of tax revenue that will be paid to the school 2464
district) be passed? The income tax, if approved, will not be 2465
levied on the incomes of individuals who do not reside in (the 2466
name of the municipal corporation).2467

        2468

 For the income tax 2469
 Against the income tax  " 2470

        2471

       (D) If the question is approved by a majority of the 2472
electors, the municipal corporation shall impose the income tax 2473
beginning inon the first day of January of the year specified in 2474
the ordinance. The proceeds of the levy may be used only for the 2475
specified purposes, including payment of the specified percentage 2476
to the school district.2477

       Sec. 718.10.  (A) This section applies to a group of two or 2478
more municipal corporations that, taken together, share the same 2479
territory as a single city, local, or exempted village school 2480
district, to the extent that not more than five per cent of the 2481
territory of the municipal corporations as a group is located 2482
outside the school district and not more than five per cent of the 2483
territory of the school district is located outside the municipal 2484
corporations as a group.2485

       (B) The legislative authorities of the municipal corporations 2486
in a group of municipal corporations to which this section applies 2487
each may propose to the electors an income tax, to be levied in 2488
concert with income taxes in the other municipal corporations of 2489
the group, except that a legislative authority may not propose to 2490
levy the income tax on the incomes of individuals who do not 2491
reside in the municipal corporation. One of the purposes of such a 2492
tax shall be to provide financial assistance to the school 2493
district through payment to the district of not less than 2494
twenty-five per cent of the revenue generated by the tax. Prior to 2495
proposing the taxes, the legislative authorities shall negotiate 2496
and enter into a written agreement with each other and with the 2497
board of education of the school district specifying the tax rate, 2498
the percentage of the tax revenue to be paid to the school 2499
district, the first year the tax will be levied, which shall be 2500
the first year after the year in which the levy is approved or any 2501
later year, and the date of the election on the question of the 2502
tax, all of which shall be the same for each municipal 2503
corporation. The agreement also shall state the purpose for which 2504
the school district will use the money, and specify the method and 2505
schedule by which each municipal corporation will make payments to 2506
the school district. The special election shall be held on a day 2507
specified in division (D) of section 3501.01 of the Revised Code, 2508
including a day on which all of the municipal corporations are to 2509
have a primary election.2510

       After the legislative authorities and board of education have 2511
entered into the agreement, each legislative authority shall 2512
provide for levying its tax by ordinance. Each ordinance shall 2513
include the provisions described in division (A) of section 718.04 2514
of the Revised Code and shall state the rate of the tax, the 2515
percentage of tax revenue to be paid to the school district, the 2516
purpose for which the municipal corporation will use its share of 2517
the tax revenue, and the first year the tax will be levied. Each 2518
ordinance also shall state that the question of the income tax 2519
will be submitted to the electors of the municipal corporation on 2520
the same date as the submission of questions of an identical tax 2521
to the electors of each of the other municipal corporations in the 2522
group, and that unless the electors of all of the municipal 2523
corporations in the group approve the tax in their respective 2524
municipal corporations, none of the municipal corporations in the 2525
group shall levy the tax. Each legislative authority also shall 2526
adopt a resolution specifying the regular or special election date 2527
the election will be held and directing the board of elections to 2528
conduct the election. At least ninety days before the date of the 2529
election, each legislative authority shall file certified copies 2530
of the ordinance and resolution with the board of elections.2531

       (C) For each of the municipal corporations, the board of 2532
elections shall make the necessary arrangements for the submission 2533
of the question to the electors, and shall conduct the election in 2534
the same manner as any other municipal income tax election. For 2535
each of the municipal corporations, notice of the election shall 2536
be published in a newspaper of general circulation in the 2537
municipal corporation once a week for four consecutive weeks, or 2538
as provided in section 7.16 of the Revised Code, prior to the 2539
election. The notice shall include a statement of the rate and 2540
municipal corporation and school district purposes of the income 2541
tax, the percentage of tax revenue that will be paid to the school 2542
district, and the first year the tax will be levied, and an 2543
explanation that the tax will not be levied unless an identical 2544
tax is approved by the electors of each of the other municipal 2545
corporations in the group. The ballot shall be in the following 2546
form:2547

       "Shall the ordinance providing for a ... per cent levy on 2548
income for (brief description of the municipal corporation and 2549
school district purposes of the levy, including a statement of the 2550
percentage of income tax revenue that will be paid to the school 2551
district) be passed? The income tax, if approved, will not be 2552
levied on the incomes of individuals who do not reside in (the 2553
name of the municipal corporation). In order for the income tax to 2554
be levied, the voters of (the other municipal corporations in the 2555
group), which are also in the (name of the school district) school 2556
district, must approve an identical income tax and agree to pay 2557
the same percentage of the tax revenue to the school district.2558

        2559

 For the income tax 2560
 Against the income tax  " 2561

        2562

       (D) If the question is approved by a majority of the electors 2563
and identical taxes are approved by a majority of the electors in 2564
each of the other municipal corporations in the group, the 2565
municipal corporation shall impose the tax beginning inon the 2566
first day of January of the year specified in the ordinance. The 2567
proceeds of the levy may be used only for the specified purposes, 2568
including payment of the specified percentage to the school 2569
district.2570

       Sec. 718.11. (A)(1) The legislative authority of each 2571
municipal corporation that imposes a tax on income in accordance 2572
with this chapter shall maintain a local board of tax review to 2573
hear appeals as provided in this section. The legislative 2574
authority of any municipal corporation that does not impose a tax 2575
on income on the effective date of this amendmentJune 26, 2003, 2576
but that imposes such a tax after that date, shall establish such 2577
a board by ordinance not later than one hundred eighty days after 2578
the tax takes effect.2579

       (2) The local board of tax review shall consist of three 2580
members. Two members shall be appointed by the legislative 2581
authority of the municipal corporation, but such appointees may 2582
not be employees, elected officials, or contractors with the 2583
municipal corporation at any time during their term or in the five 2584
years immediately preceding the date of appointment. One member 2585
shall be appointed by the top administrative official of the 2586
municipal corporation. This member may be an employee of the 2587
municipal corporation, but may not be the director of finance or 2588
equivalent officer, or the tax administrator or other similar 2589
official or an employee directly involved in municipal tax 2590
matters, or any direct subordinate thereof.2591

       (3) The term for members of the local board of tax review 2592
appointed by the legislative authority of the municipal 2593
corporation shall be two years. There is no limit on the number of 2594
terms that a member may serve if the member is reappointed by the 2595
legislative authority. The board member appointed by the top 2596
administrative official of the municipal corporation shall serve 2597
at the discretion of the administrative official.2598

       (4) Members of the board of tax review appointed by the 2599
legislative authority may be removed by the legislative authority 2600
by majority vote for malfeasance, misfeasance, or nonfeasance in 2601
office. To remove such a member, the legislative authority must 2602
give the member a copy of the charges against the member and 2603
afford the member an opportunity to be publicly heard in person or 2604
by counsel in the member's own defense upon not less than ten 2605
days' notice. The decision by the legislative authority on the 2606
charges is final and not appealable.2607

       (5) A member of the board who, for any reason, ceases to meet 2608
the qualifications for the position prescribed by this section 2609
shall resign immediately by operation of law.2610

       (6) A vacancy in an unexpired term shall be filled in the 2611
same manner as the original appointment within sixty days of when 2612
the vacancy was created. Any member appointed to fill a vacancy 2613
occurring prior to the expiration of the term for which the 2614
member's predecessor was appointed shall hold office for the 2615
remainder of such term. No vacancy on the board shall impair the 2616
power and authority of the remaining members to exercise all the 2617
powers of the board.2618

       (B) Whenever a written determination by the tax administrator 2619
issues a decision regarding a municipal income tax obligation that 2620
is subject to appeal as provided in this section or in an 2621
ordinance or regulation of the municipal corporationis issued, 2622
the tax administrator shall notify the taxpayer in writing at the 2623
same time of the taxpayer's right to appeal the decision and of2624
written determination, the manner in which the taxpayer may appeal 2625
the decisionruling, and the address to which the appeal should be 2626
directed.2627

       (C) Any person who is aggrieved by a decision by the tax 2628
administrator and who has filed with the municipal corporation the 2629
required returns or other documents pertaining to the municipal 2630
income tax obligation at issue in the decisionhas been issued a 2631
written determination by the tax administrator may appeal the 2632
decisionruling to the board created pursuant to this section by 2633
filing a request with the board. The request shall be in writing, 2634
shall statespecify the reason or reasons why the decisionruling2635
should be deemed incorrect or unlawful, and shall be filed within 2636
thirtysixty days after the tax administrator issuestaxpayer 2637
receives the decision complained ofruling.2638

       (D) The local board of tax review shall schedule a hearing to 2639
be held within forty-fivesixty days after receiving the request2640
an appeal of a written determination by the tax administrator 2641
under division (C) of this section, unless the taxpayer requests 2642
additional time to prepare or waives a hearing. If the taxpayer 2643
does not waive the hearing, the taxpayer may appear before the 2644
board and may be represented by an attorney at law, certified 2645
public accountant, or other representative. The board may allow a 2646
hearing to be continued as jointly agreed to by the parties, but 2647
the hearing must be completed within one hundred twenty days after 2648
the first day of the hearing.2649

       (E) The board may affirm, reverse, or modify the tax 2650
administrator's decisiona written determination by the tax 2651
administrator or any part of that decisionruling. The board 2652
shall issue a final decision on the appeal within ninety days 2653
after the board's final hearing on the appeal, and send a copy of 2654
its final decision by ordinary mail to all of the parties to the 2655
appeal within fifteen days after issuing the decision. The 2656
taxpayer or the tax administrator may appeal the board's decision 2657
as provided in section 5717.011 of the Revised Code.2658

       Each(F) The local board of appealtax review created 2659
pursuant to this section shall adopt rules governing its 2660
procedures and shall keep a record of its transactions. Such 2661
records are not public records available for inspection under 2662
section 149.43 of the Revised Code. Hearings requested by a 2663
taxpayer before a local board of appealtax review created 2664
pursuant to this section are not meetings of a public body subject 2665
to section 121.22 of the Revised Code.2666

       Sec. 718.12.  (A)(1)(a) Civil actions to recover municipal 2667
income taxes and penalties and interest on municipal income taxes 2668
shall be brought within the later of:2669

       (i) Three years after the tax was due or the return was 2670
filed, whichever is later; or2671

       (ii) One year after the conclusion of the qualifying deferral 2672
period, if any. 2673

       (b) The time limit described in division (A)(1)(a) of this 2674
section may be extended at any time if both the tax administrator 2675
and the employer, agent of the employer, other payer, or taxpayer 2676
consent in writing to the extension. Any extension shall also 2677
extend for the same period of time the time limit described in 2678
division (C) of this section.2679

       (2) As used in this section, "qualifying deferral period" 2680
means a period of time beginning and ending as follows: 2681

       (a) Beginning on the date a person who is aggrieved by a 2682
written determination by the tax administrator files with a local 2683
board of tax review the request described in section 718.11 of the 2684
Revised Code. That date shall not be affected by any subsequent 2685
decision, finding, or holding by any administrative body or court 2686
that the local board of tax review with which the aggrieved person 2687
filed the request did not have jurisdiction to affirm, reverse, or 2688
modify the written determination by the tax administrator or any 2689
part of that determination.2690

       (b) Ending the later of the sixtieth day after the date on 2691
which the decision of the local board of tax review becomes final 2692
or, if any party appeals from the decision of the local board of 2693
tax review, the sixtieth day after the date on which the decision 2694
of the local board of tax review is either ultimately affirmed in 2695
whole or in part or ultimately reversed and no further appeal of 2696
either that affirmation, in whole or in part, or that reversal is 2697
available or taken.2698

       (B) Prosecutions for an offense made punishable under a 2699
resolution or ordinance imposing an income tax shall be commenced 2700
within three years after the commission of the offense, provided 2701
that in the case of fraud, failure to file a return, or the 2702
omission of twenty-five per cent or more of income required to be 2703
reported, prosecutions may be commenced within six years after the 2704
commission of the offense.2705

       (C) A claim for a refund of municipal income taxes shall be 2706
brought within the time limitation provided in section 718.19 of 2707
the Revised Code.2708

       (D) Interest shall be allowed and paid on any overpayment by 2709
a taxpayer of any municipal income tax obligation from the date of 2710
the overpayment until the date of the refund of the overpayment, 2711
except that if any overpayment is refunded within ninety days 2712
after the final filing date of the annual return or ninety days 2713
after the completed return is filed, whichever is later, no 2714
interest shall be allowed on the refund. For the purpose of 2715
computing the payment of interest on amounts overpaid, no amount 2716
of tax for any taxable year shall be considered to have been paid 2717
before the date on which the return on which the tax is reported 2718
is due, without regard to any extension of time for filing that 2719
return. Interest shall be paid at the interest rate, as that term 2720
is defined in section 718.27 of the Revised Code.2721

       (E) Within sixty days after the final determination of any 2722
federal or state tax liability affecting the taxpayer's municipal 2723
tax liability, that taxpayer shall make and file an amended 2724
municipal return showing income subject to the municipal income 2725
tax based upon such final determination of federal or state tax 2726
liability, and pay any additional municipal income tax shown due 2727
thereon or make a claim for refund of any overpayment, unless the 2728
tax or overpayment is less than ten dollars.2729

       (F)(1) Notwithstanding the fact that an appeal is pending, 2730
the petitioner may pay all or a portion of the written 2731
determination by the tax administrator that is the subject of the 2732
appeal. The acceptance of a payment by the municipal corporation 2733
does not prejudice any claim for refund upon final determination 2734
of the appeal.2735

       (2) If upon final determination of the appeal an error in the 2736
written determination by the tax administrator is corrected by the 2737
tax administrator, upon an appeal so filed or pursuant to a 2738
decision of the local board of tax review created under section 2739
718.11 of the Revised Code, of the Ohio board of tax appeals, or 2740
any court to which the decision of the Ohio board of tax appeals 2741
has been appealed, so that the amount due from the party assessed 2742
under the corrected written determination is less than the amount 2743
paid, there shall be issued to the appellant or to the appellant's 2744
assigns or legal representative a refund in the amount of the 2745
overpayment as provided by section 718.19 of the Revised Code, 2746
with interest on that amount as provided by division (D) of this 2747
section.2748

       (G) No civil action to recover municipal income tax or 2749
related penalties or interest shall be brought during either of 2750
the following time periods:2751

        (1) The period during which a taxpayer has a right to appeal 2752
the imposition of that tax or interest or those penalties;2753

        (2) The period during which an appeal related to the 2754
imposition of that tax or interest or those penalties is pending.2755

       Sec. 718.121. (A) Except as provided in division (B) of this 2756
section, if tax or withholding is paid to a municipal corporation 2757
on income or wages, and if a second municipal corporation imposes 2758
or assesses a tax on that income or wages after the time period 2759
allowed for a refund of the tax or withholding paid to the first 2760
municipal corporation, the second municipal corporation shall 2761
allow a nonrefundable credit, against the tax or withholding the 2762
second municipality claims is due with respect to such income or 2763
wages, equal to the tax or withholding paid to the first municipal 2764
corporation with respect to such income or wages.2765

       (B) If the tax rate in the second municipal corporation is 2766
less than the tax rate in the first municipal corporation, then 2767
the credit described in division (A) of this section shall be 2768
calculated using the tax rate in effect in the second municipal 2769
corporation.2770

        (C) If the tax rate in the second municipal corporation is 2771
greater than the tax rate in the first municipal corporation, the 2772
tax due in excess of the credit afforded is to be paid to the 2773
second municipal corporation, along with any interest accruing 2774
thereto during the period of nonpayment.2775

        (D) Nothing in this section permits any credit carryforward.2776

       Sec. 718.13.  (A) Any information gained as a result of 2777
returns, investigations, hearings, or verifications required or 2778
authorized by this chapter or by a charter or ordinance of a 2779
municipal corporation levying an income tax pursuant to this 2780
chapter is confidential, and no person shall access or disclose 2781
such information except in accordance with a proper judicial order 2782
or in connection with the performance of that person's official 2783
duties or the official business of the municipal corporation as 2784
authorized by this chapter or the charter or ordinance authorizing 2785
the levy. The tax administrator of the municipal corporation or a 2786
designee thereof may furnish copies of returns filed or otherwise 2787
received under this chapter and other related tax information to 2788
the internal revenue service and to, the tax commissioner, and tax 2789
administrators of other municipal corporations.2790

       (B) This section does not prohibit the legislative authority 2791
of a municipal corporation, by ordinance or resolution, from 2792
authorizing the tax administrator to publishpublishing or 2793
disclosing statistics in a form that does not disclose information 2794
with respect to particular taxpayers.2795

       Sec. 718.18. (A)(1) Subject to division (B) of this section, 2796
a copy of each written determination by the tax administrator 2797
shall be served upon the person affected thereby either by 2798
personal service, by certified mail, or by a delivery service 2799
authorized under section 5703.056 of the Revised Code.2800

       (2) With the permission of the person affected by a written 2801
determination by the tax administrator, the tax administrator may 2802
deliver the determination through alternative means as provided in 2803
this section, including, but not limited to, delivery by secure 2804
electronic mail. Delivery by such means satisfies the requirements 2805
for delivery under this section.2806

       (B)(1)(a) If certified mail is returned because of an 2807
undeliverable address, a tax administrator shall utilize 2808
reasonable means to ascertain a new last known address, including 2809
the use of a change of address service offered by the postal 2810
service or an authorized delivery service under section 5703.056 2811
of the Revised Code. If, after using reasonable means, the tax 2812
administrator is unable to ascertain a new last known address, the 2813
written determination by the tax administrator shall be sent by 2814
ordinary mail and considered served. If the ordinary mail is 2815
subsequently returned because of an undeliverable address, the 2816
determination remains appealable within sixty days after the 2817
determination's postmark.2818

       (b) Notwithstanding delivery for collection under division 2819
(B)(1)(a) of this section, once the tax administrator or other 2820
municipal official, or the designee of either, serves a written 2821
determination by the tax administrator on the person to whom the 2822
determination is directed, the person may protest the ruling of 2823
that determination by filing an appeal with the local board of tax 2824
review within sixty days after the receipt of service. The 2825
delivery of a written determination of the tax administrator under 2826
division (B)(1)(a) of this section is prima facie evidence that 2827
delivery is complete and that the determination is served.2828

       (2) If mailing of a written determination by a tax 2829
administrator by certified mail is returned for some cause other 2830
than an undeliverable address, the tax administrator shall resend 2831
the written determination by ordinary mail. The written 2832
determination shall show the date the tax administrator sends the 2833
written determination and include the following statement:2834

       "This written determination by the tax administrator is 2835
deemed to be served on the addressee under applicable law ten days 2836
from the date this written determination was mailed by the tax 2837
administrator as shown on the written determination, and all 2838
periods within which an appeal may be filed apply from and after 2839
that date."2840

       Unless the mailing is returned because of an undeliverable 2841
address, the mailing of that information is prima facie evidence 2842
that delivery of the written determination was completed ten days 2843
after the tax administrator sent the written determination by 2844
ordinary mail and that the written determination was served.2845

       If the ordinary mail is subsequently returned because of an 2846
undeliverable address, the tax administrator shall proceed under 2847
division (B)(1)(a) of this section. A person may challenge the 2848
presumption of delivery and service under this division in 2849
accordance with division (C) of this section.2850

       (C)(1) A person disputing the presumption of delivery and 2851
service under division (B) of this section bears the burden of 2852
proving by a preponderance of the evidence that the address to 2853
which the written determination by the tax administrator was sent 2854
was not an address with which the person was associated at the 2855
time the tax administrator originally mailed the written 2856
determination by certified mail. For the purposes of this section, 2857
a person is associated with an address at the time the tax 2858
administrator originally mailed the written determination if, at 2859
that time, the person was residing, receiving legal documents, or 2860
conducting business at the address; or if, before that time, the 2861
person had conducted business at the address and, when the written 2862
determination was mailed, the person's agent or the person's 2863
affiliate was conducting business at the address. For the purposes 2864
of this section, a person's affiliate is any other person that, at 2865
the time the written determination was mailed, owned or controlled 2866
at least twenty per cent, as determined by voting rights, of the 2867
addressee's business.2868

       (2) If the person elects to appeal a written determination by 2869
the tax administrator that has otherwise become final and is 2870
subject to collection, the person must do so within sixty days 2871
after the initial contact by the official, or the official's 2872
designee, with the person. The official may enter into a 2873
compromise with the person if the person does not file an appeal 2874
with the local board of tax review.2875

       (D) Nothing in this section prohibits the tax administrator 2876
or the tax administrator's designee from delivering a written 2877
determination by a tax administrator by personal service.2878

       (E) Collection actions taken upon any written determination 2879
by the tax administrator being appealed under division (B)(1)(b) 2880
of this section shall be stayed upon the pendency of an appeal 2881
under this section. If an appeal is filed pursuant to this section 2882
on a claim that has been delivered for collection, the collection 2883
activities with respect to the written determination shall be 2884
stayed.2885

       (F) As used in this section:2886

       (1) "Last known address" means the address the tax 2887
administrator has at the time a document is originally sent by 2888
certified mail, or any address the tax administrator can ascertain 2889
using reasonable means such as the use of a change of address 2890
service offered by the postal service or an authorized delivery 2891
service under section 5703.056 of the Revised Code.2892

       (2) "Undeliverable address" means an address to which the 2893
postal service or an authorized delivery service under section 2894
5703.056 of the Revised Code is not able to deliver a written 2895
determination of the tax administrator, except when the reason for 2896
nondelivery is because the addressee fails to acknowledge or 2897
accept the determination.2898

       Sec. 718.19. (A) Upon receipt of a refund application, the 2899
tax administrator of a municipal corporation, in accordance with 2900
this section, shall refund to employers, agents of employers, 2901
other payers, or taxpayers, with respect to any income or 2902
withholding tax levied by the municipal corporation:2903

       (1) Overpayments of more than ten dollars;2904

       (2) Amounts in excess of ten dollars paid erroneously.2905

       (B) Except as otherwise provided in this chapter, 2906
applications for refund shall be filed with the tax administrator, 2907
on the form prescribed by the tax administrator within three years 2908
after the tax was due or paid, whichever is later. The tax 2909
administrator may require an applicant to file with the 2910
application any documentation that substantiates the applicant's 2911
claim for a refund.2912

       On filing of the refund application, the tax administrator 2913
shall determine the amount of refund due and certify such amount 2914
to the appropriate municipal corporation official for payment.2915

       (C) An application for a refund that is received after the 2916
last day for filing specified in division (B) of this section 2917
shall be considered to have been filed in a timely manner if any 2918
of the following situations exist: 2919

       (1) The application is delivered by the postal service, and 2920
the earliest postal service postmark on the cover in which the 2921
application is enclosed is not later than the last day for filing 2922
the application.2923

       (2) The application is delivered by the postal service, the 2924
only postmark on the cover in which the application is enclosed 2925
was affixed by a private postal meter, the date of that postmark 2926
is not later than the last day for filing the application, and the 2927
application is received within seven days of such last day.2928

       (3) The application is delivered by the postal service, no 2929
postmark date was affixed to the cover in which the application is 2930
enclosed or the date of the postmark so affixed is not legible, 2931
and the application is received within seven days of the last day 2932
for making the application. 2933

       (D) As used in this section, "withholding tax" has the same 2934
meaning as in section 718.27 of the Revised Code. 2935

       Sec. 718.22. (A) A tax administrator may, by rule, prescribe 2936
uniform requirements as to the keeping of records and other 2937
pertinent documents related to the liability of any person for a 2938
tax imposed by a municipal corporation in accordance with this 2939
chapter, and as to the filing of copies of federal income tax 2940
returns and determinations. Such records and other documents shall 2941
be open to the tax administrator's inspection during business 2942
hours and shall be preserved for a period of six years following 2943
the end of the taxable year to which the records or documents 2944
relate, unless the tax administrator, in writing, consents to 2945
their destruction within that period, or by order requires that 2946
they be kept longer.2947

       (B) In addition to any requirements prescribed pursuant to 2948
division (A) of this section, the tax administrator of a municipal 2949
corporation may require any person, by notice served on that 2950
person, to keep such records as the tax administrator determines 2951
necessary to show whether or not that person is liable, and the 2952
extent of such liability, for the income tax levied by the 2953
municipal corporation or for the withholding of such tax. 2954

       Sec. 718.23. (A) A tax administrator, or any authorized agent 2955
or employee thereof may examine the books, papers, records, and 2956
federal and state income tax returns of any employer, taxpayer, or 2957
other person that is subject to, or that the tax administrator 2958
believes is subject to, the provisions of this chapter for the 2959
purpose of verifying the accuracy of any return made or, if no 2960
return was filed, to ascertain the tax due under this chapter. 2961
Upon written request by the tax administrator or a duly authorized 2962
agent or employee thereof, every employer, taxpayer, or other 2963
person subject to this section is required to furnish the 2964
opportunity for the tax administrator, authorized agent, or 2965
employee to investigate and examine such books, papers, records, 2966
and federal and state income tax returns at a reasonable time and 2967
place designated in the request.2968

       (B) The tax administrator may examine under oath any person 2969
that the tax administrator reasonably believes has knowledge 2970
concerning any income that was or would have been returned for 2971
taxation or any transaction tending to affect such income. The tax 2972
administrator may, for this purpose, compel any such person to 2973
attend a hearing or examination and to produce any books, papers, 2974
records, and federal income tax returns in such person's 2975
possession or control. The person may be assisted or represented 2976
by an attorney, accountant, bookkeeper, or other tax practitioner 2977
at any such hearing or examination. This division does not 2978
authorize the practice of law by a person who is not an attorney.2979

       No person issued written notice by the tax administrator 2980
compelling such attendance or production of books, papers, 2981
records, or federal income tax returns under this division shall 2982
fail to comply.2983

       Sec. 718.24.  Nothing in this chapter shall limit the 2984
authority of a tax administrator to perform any of the following 2985
duties or functions, unless the performance of such duties or 2986
functions is expressly limited by a provision of the Revised Code 2987
or the charter or ordinances of the municipal corporation:2988

       (A) Exercise all powers whatsoever of an inquisitorial nature 2989
as provided by law, including, the right to inspect books, 2990
accounts, records, memorandums, and federal and state income tax 2991
returns, to examine persons under oath, to issue orders or 2992
subpoenas for the production of books, accounts, papers, records, 2993
documents, and testimony, to take depositions, to apply to a court 2994
for attachment proceedings as for contempt, to approve vouchers 2995
for the fees of officers and witnesses, and to administer oaths; 2996
provided that the powers referred to in this division of this 2997
section shall be exercised by the tax administrator only in 2998
connection with the performance of the duties respectively 2999
assigned to the tax administrator under a municipal corporation 3000
income tax ordinance or resolution adopted in accordance with this 3001
chapter;3002

       (B) Appoint agents and prescribe their powers and duties;3003

       (C) Confer and meet with officers of other municipal 3004
corporations and states and officers of the United States on any 3005
matters pertaining to their respective official duties as provided 3006
by law;3007

       (D) Exercise the authority provided by law, including orders 3008
from bankruptcy courts, relative to remitting or refunding taxes, 3009
including penalties and interest thereon, illegally or erroneously 3010
imposed or collected, or for any other reason overpaid, and, in 3011
addition, the tax administrator may investigate any claim of 3012
overpayment and make a written statement of the tax 3013
administrator's findings, and, if the tax administrator finds that 3014
there has been an overpayment, approve and issue a refund payable 3015
to the taxpayer, the taxpayer's assigns, or legal representative 3016
as provided in this chapter;3017

       (E) Exercise the authority provided by law relative to 3018
consenting to the compromise and settlement of tax claims;3019

       (F) Exercise the authority provided by law relative to the 3020
use of alternative apportionment methods by taxpayers in 3021
accordance with section 718.02 of the Revised Code;3022

       (G) Make all tax findings, determinations, computations, and 3023
orders the tax administrator is by law authorized and required to 3024
make and, pursuant to time limitations provided by law, on the tax 3025
administrator's own motion, review, redetermine, or correct any 3026
tax findings, determinations, computations, or orders the tax 3027
administrator has made, but the tax administrator shall not 3028
review, redetermine, or correct any tax finding, determination, 3029
computation, or order which the tax administrator has made as to 3030
which an appeal has been filed with the local board of tax review 3031
or other appropriate tribunal, unless such appeal or application 3032
is withdrawn by the appellant or applicant, is dismissed, or is 3033
otherwise final;3034

       (H) Destroy any or all returns or other tax documents in the 3035
manner authorized by law;3036

       (I) Enter into an agreement with a taxpayer to simplify the 3037
withholding obligations described in section 718.03 of the Revised 3038
Code.3039

       Sec. 718.25.  A person may round to the nearest whole dollar 3040
all amounts the person is required to enter on any return, report, 3041
voucher, or other document required under this chapter. Any 3042
fractional part of a dollar that equals or exceeds fifty cents 3043
shall be rounded to the next whole dollar, and any fractional part 3044
of a dollar that is less than fifty cents shall be dropped. If a 3045
person chooses to round amounts entered on a document, the person 3046
shall round all amounts entered on the document.3047

       Sec. 718.26.  (A) Nothing in this chapter prohibits a tax 3048
administrator from requiring any person filing a tax document with 3049
the tax administrator to provide identifying information, which 3050
may include the person's social security number, federal employer 3051
identification number, or other identification number requested by 3052
the tax administrator. A person required by the tax administrator 3053
to provide identifying information that has experienced any change 3054
with respect to that information shall notify the tax 3055
administrator of the change before, or upon, filing the next tax 3056
document requiring the identifying information.3057

       (B) When transmitting or otherwise making use of a tax 3058
document that contains a person's social security number, the tax 3059
administrator shall take all reasonable measures necessary to 3060
ensure that the number is not capable of being viewed by the 3061
general public, including, when necessary, masking the number so 3062
that it is not readily discernible by the general public. The tax 3063
administrator shall not put a person's social security number on 3064
the outside of any material mailed to the person.3065

       (C)(1) If the tax administrator makes a request for 3066
identifying information and the tax administrator does not receive 3067
valid identifying information within thirty days of making the 3068
request, nothing in this chapter prohibits the tax administrator 3069
from imposing a penalty upon the person to whom the request was 3070
directed pursuant to section 718.27 of the Revised Code, in 3071
addition to any applicable penalty described in section 718.99 of 3072
the Revised Code. 3073

       (2) If a person required by the tax administrator to provide 3074
identifying information does not notify the tax administrator of a 3075
change with respect to that information as required under division 3076
(A) of this section within thirty days after filing the next tax 3077
document requiring such identifying information, nothing in this 3078
chapter prohibits the tax administrator from imposing a penalty 3079
pursuant to section 718.27 of the Revised Code.3080

       (3) The penalties provided for under divisions (C)(1) and (2) 3081
of this section may be billed and imposed in the same manner as 3082
the tax or fee with respect to which the identifying information 3083
is sought and are in addition to any applicable criminal penalties 3084
described in section 718.99 of the Revised Code for a violation of 3085
section 718.35 of the Revised Code and any other penalties that 3086
may be imposed by the tax administrator by law.3087

       Sec. 718.27.  (A) As used in this section:3088

       (1) "Applicable law" means this chapter, the resolutions, 3089
ordinances, codes, directives, instructions, and rules adopted by 3090
a municipal corporation provided such resolutions, ordinances, 3091
codes, directives, instructions, and rules impose or directly or 3092
indirectly address the levy, payment, remittance, or filing 3093
requirements of a municipal income tax.3094

       (2) "Income tax," "estimated income tax," and "withholding 3095
tax" means any income tax, estimated income tax, and withholding 3096
tax imposed by a municipal corporation pursuant to applicable law, 3097
including at any time before January 1, 2015.3098

       (3) A "return" includes any tax return, report, 3099
reconciliation, schedule, and other document required to be filed 3100
with a tax administrator or municipal corporation by a taxpayer, 3101
employer, any agent of the employer, or any other payer pursuant 3102
to applicable law, including at any time before January 1, 2015.3103

       (4) "Federal short-term rate" means the rate of the average 3104
market yield on outstanding marketable obligations of the United 3105
States with remaining periods to maturity of three years or less, 3106
as determined under section 1274 of the Internal Revenue Code, for 3107
July of the current year.3108

       (5) "Interest rate as described in division (A) of this 3109
section" means the federal short-term rate, rounded to the nearest 3110
whole number per cent, plus five per cent. The rate shall apply 3111
for the calendar year next following the July of the year in which 3112
the federal short-term rate is determined in accordance with 3113
division (A)(4) of this section.3114

       (6) "Unpaid estimated income tax" means estimated income tax 3115
due but not paid by the date the tax is required to be paid under 3116
applicable law.3117

       (7) "Unpaid income tax" means income tax due but not paid by 3118
the date the income tax is required to be paid under applicable 3119
law.3120

       (8) "Unpaid withholding tax" means withholding tax due but 3121
not paid by the date the withholding tax is required to be paid 3122
under applicable law.3123

       (9) "Withholding tax" includes amounts an employer, any agent 3124
of an employer, or any other payer did not withhold in whole or in 3125
part from an employee's qualifying wages, but that, under 3126
applicable law, the employer, agent, or other payer is required to 3127
withhold from an employee's qualifying wages. 3128

       (B)(1) This section applies to the following:3129

       (a) Any return required to be filed under applicable law for 3130
taxable years beginning on or after January 1, 2015;3131

       (b) Income tax, estimated income tax, and withholding tax 3132
required to be paid or remitted to the municipal corporation on or 3133
after January 1, 2015;3134

       (c) Income tax, estimated income tax, and withholding tax 3135
required to be paid or remitted to the municipal corporation any 3136
time before January 1, 2015, if the income tax, estimated income 3137
tax, or withholding tax has not been paid or remitted on or before 3138
June 30, 2015.3139

       (2) This section does not apply to returns required to be 3140
filed or payments required to be made before January 1, 2015, 3141
regardless of the filing or payment date. Returns required to be 3142
filed or payments required to be made before January 1, 2015, but 3143
filed or paid after that date shall be subject to the ordinances 3144
or rules, as adopted before January 1, 2015, of the municipal 3145
corporation to which the return is to be filed or the payment is 3146
to be made.3147

       (C) Each municipal corporation levying a tax on income shall 3148
impose on a taxpayer, employer, any agent of the employer, and any 3149
other payer, and must attempt to collect, the interest amounts and 3150
penalties prescribed under division (C) of this section when the 3151
taxpayer, employer, any agent of the employer, or any other payer 3152
for any reason fails, in whole or in part, to make to the 3153
municipal corporation timely and full payment or remittance of 3154
income tax, estimated income tax, or withholding tax or to file 3155
timely with the municipal corporation any return required to be 3156
filed.3157

       (1) Interest shall be imposed at the rate described in 3158
division (A) of this section, per annum, on all unpaid income tax, 3159
unpaid estimated income tax, and unpaid withholding tax.3160

       (2)(a) With respect to unpaid income tax and unpaid estimated 3161
income tax, a municipal corporation shall impose a penalty equal 3162
to fifteen per cent of the amount not timely paid.3163

       (b) With respect to any unpaid withholding tax, a municipal 3164
corporation shall impose a penalty equal to fifty per cent of the 3165
amount not timely paid.3166

       (3)(a) With respect to annual income tax returns for 3167
individuals, a municipal corporation shall impose a penalty of 3168
twenty-five dollars for each failure to timely file each return, 3169
regardless of the liability shown thereon.3170

       (b) With respect to returns other than annual income tax 3171
returns for individuals and estimated income tax returns, a 3172
municipal corporation shall impose a penalty of twenty-five 3173
dollars for each failure to timely file each return, regardless of 3174
the liability shown thereon for each month, or any fraction 3175
thereof, during which the return remains unfiled regardless of the 3176
liability shown thereon. The penalty shall not exceed one hundred 3177
fifty dollars for each failure.3178

       (D)(1) With respect to the income taxes, estimated income 3179
taxes, withholding taxes, and returns, no municipal corporation 3180
shall impose, seek to collect, or collect any penalty, amount of 3181
interest, charges, or additional fees not described in this 3182
section. 3183

       (2) With respect to the income taxes, estimated income taxes, 3184
withholding taxes, and returns not described in division (A) of 3185
this section, nothing in this section requires a municipal 3186
corporation to refund or credit any penalty, amount of interest, 3187
charges, or additional fees that the municipal corporation has 3188
properly imposed or collected before January 1, 2015.3189

       (E) Nothing in this section limits the authority of a 3190
municipal corporation to abate or partially abate penalties or 3191
interest imposed under this section when the tax administrator 3192
determines, in the tax administrator's sole discretion, that such 3193
abatement is appropriate. 3194

       (F) By the thirty-first day of October of each year the 3195
municipal corporation shall publish the rate described in division 3196
(A) of this section applicable to the next succeeding calendar 3197
year. 3198

       (G) The municipal corporation may impose on the taxpayer, 3199
employer, any agent of the employer, or any other payer the 3200
municipal corporation's post-judgment collection costs and fees, 3201
including attorney's fees.3202

       Sec. 718.28.  (A) As used in this section, "claim" means a 3203
claim for an amount payable to a municipal corporation that arises 3204
pursuant to the municipal income tax imposed in accordance with 3205
this chapter.3206

       (B) Nothing in this chapter prohibits a tax administrator 3207
from doing either of the following if such action is in the best 3208
interests of the municipal corporation:3209

       (1) Compromise a claim;3210

       (2) Extend for a reasonable period the time for payment of a 3211
claim by agreeing to accept monthly or other periodic payments.3212

       (C) The tax administrator may consider the following 3213
standards when ascertaining with respect to a claim whether a 3214
compromise or payment-over-time agreement is in the best interests 3215
of the municipal corporation:3216

       (1) There exists a doubt as to whether the claim can be 3217
collected.3218

       (2) There exists an economic hardship such that a compromise 3219
or agreement would facilitate effective tax administration.3220

       (3) There exists a joint liability among spouses, one of whom 3221
is an innocent spouse, provided that any relief under this 3222
standard shall only affect the claim as to the innocent spouse. A 3223
spouse granted relief under section 6015 of the Internal Revenue 3224
Code with regard to any income item is rebuttably presumed to be 3225
an innocent spouse with regard to that income item to the extent 3226
that income item is included in or otherwise affects the 3227
computation of a municipal income tax or any penalty or interest 3228
on that tax.3229

       (4) Any other reasonable standard that the tax administrator 3230
establishes.3231

       (D) The tax administrator's rejection of a compromise or 3232
payment-over-time agreement proposed by a person with respect to a 3233
claim shall not be appealable.3234

       (E) A compromise or payment-over-time agreement with respect 3235
to a claim shall be binding upon and shall inure to the benefit of 3236
only the parties to the compromise or agreement, and shall not 3237
extinguish or otherwise affect the liability of any other person.3238

       (F) A compromise or payment-over-time agreement with respect 3239
to a claim shall be void if the taxpayer defaults under the 3240
compromise or agreement or if the compromise or agreement was 3241
obtained by fraud or by misrepresentation of a material fact. Any 3242
amount that was due before the compromise or agreement and that is 3243
unpaid shall remain due, and any penalties or interest that would 3244
have accrued in the absence of the compromise or agreement shall 3245
continue to accrue and be due.3246

       Sec. 718.30.  Nothing in this chapter prohibits the 3247
legislative authority of a municipal corporation, or a tax 3248
administrator pursuant to authority granted to the administrator 3249
by resolution or ordinance, to adopt rules to administer an income 3250
tax imposed by the municipal corporation in accordance with this 3251
chapter. Such rules shall not conflict with or be inconsistent 3252
with any provision of this chapter. All rules adopted under this 3253
section shall be published and posted on the internet as described 3254
in section 718.07 of the Revised Code.3255

       Sec. 718.31.  (A) To carry out the purposes of laws that a 3256
tax administrator is required to administer, the tax administrator 3257
or any person employed by the tax administrator for that purpose, 3258
upon demand, may inspect the books, accounts, records, memoranda, 3259
and federal and state income tax returns of any person subject to 3260
those laws, and may examine under oath any officer, agent, or 3261
employee of that person. Any person other than the tax 3262
administrator who makes a demand pursuant to this section shall 3263
produce the person's authority to make the inspection.3264

       (B) If a person receives at least ten days' written notice of 3265
a demand made under division (A) of this section and refuses to 3266
comply with that demand, the tax administrator may impose a 3267
penalty on the person pursuant to section 718.27 of the Revised 3268
Code.3269

       (C) No person hired or retained by a tax administrator to 3270
examine or inspect a taxpayer's books shall be paid on a 3271
contingency basis.3272

       Sec. 718.35.  No person shall knowingly make, present, aid, 3273
or assist in the preparation or presentation of a false or 3274
fraudulent report, return, schedule, statement, claim, or document 3275
authorized or required by municipal corporation ordinance or state 3276
law to be filed with a tax administrator, or knowingly procure, 3277
counsel, or advise the preparation or presentation of such report, 3278
return, schedule, statement, claim, or document, or knowingly 3279
change, alter, or amend, or knowingly procure, counsel or advise 3280
such change, alteration, or amendment of the records upon which 3281
such report, return, schedule, statement, claim, or document is 3282
based with intent to defraud the municipal corporation or a tax 3283
administrator.3284

       Sec. 718.38.  (A) An "opinion of the tax administrator" means 3285
an opinion issued under this section with respect to prospective 3286
municipal income tax liability. It does not include ordinary 3287
correspondence of the tax administrator.3288

       (B) A taxpayer may submit a written request for an opinion of 3289
the tax administrator as to whether or how certain income, source 3290
of income, or a certain activity or transaction will be taxed. The 3291
written response of the tax administrator shall be an "opinion of 3292
the tax administrator" and shall bind the tax administrator, in 3293
accordance with divisions (C), (G), and (H) of this section, 3294
provided all of the following conditions are satisfied:3295

       (1) The taxpayer's request fully and accurately describes the 3296
specific facts or circumstances relevant to a determination of the 3297
taxability of the income, source of income, activity, or 3298
transaction, and, if an activity or transaction, all parties 3299
involved in the activity or transaction are clearly identified by 3300
name, location, or other pertinent facts.3301

       (2) The request relates to a tax imposed by the municipal 3302
corporation in accordance with this chapter.3303

       (3) The tax administrator's response is signed by the tax 3304
administrator and designated as an "opinion of the tax 3305
administrator."3306

       (C) An opinion of the tax administrator shall remain in 3307
effect and shall protect the taxpayer for whom the opinion was 3308
prepared and who reasonably relies on it from liability for any 3309
taxes, penalty, or interest otherwise chargeable on the activity 3310
or transaction specifically held by the tax administrator's 3311
opinion to be taxable in a particular manner or not to be subject 3312
to taxation for any taxable years that may be specified in the 3313
opinion, or until the earliest of the following dates:3314

       (1) The effective date of a written revocation by the tax 3315
administrator sent to the taxpayer by certified mail, return 3316
receipt requested. The effective date of the revocation shall be 3317
the taxpayer's date of receipt or one year after the issuance of 3318
the opinion, whichever is later;3319

       (2) The effective date of any amendment or enactment of a 3320
relevant section of the Revised Code, uncodified state law, or the 3321
municipal corporation's income tax ordinance that would 3322
substantially change the analysis and conclusion of the opinion of 3323
the tax administrator;3324

       (3) The date on which a court issues an opinion establishing 3325
or changing relevant case law with respect to the Revised Code, 3326
uncodified state law, or the municipal corporation's income tax 3327
ordinance;3328

       (4) If the opinion of the tax administrator was based on the 3329
interpretation of federal law, the effective date of any change in 3330
the relevant federal statutes or regulations, or the date on which 3331
a court issues an opinion establishing or changing relevant case 3332
law with respect to federal statutes or regulations;3333

       (5) The effective date of any change in the taxpayer's 3334
material facts or circumstances;3335

       (6) The effective date of the expiration of the opinion, if 3336
specified in the opinion.3337

       (D) A taxpayer is not relieved of tax liability for any 3338
activity or transaction related to a request for an opinion that 3339
contained any misrepresentation or omission of one or more 3340
material facts.3341

       (E) If a tax administrator provides written advice under this 3342
section, the opinion shall include a statement that:3343

       (1) The tax consequences stated in the opinion may be subject 3344
to change for any of the reasons stated in division (C) of this 3345
section;3346

       (2) It is the duty of the taxpayer to be aware of such 3347
changes.3348

       (F) A tax administrator may refuse to offer an opinion on any 3349
request received under this section.3350

       (G) This section binds a tax administrator only with respect 3351
to opinions of the tax administrator issued on or after January 1, 3352
2015.3353

       (H) An opinion of a tax administrator binds that tax 3354
administrator only with respect to the taxpayer for whom the 3355
opinion was prepared and does not bind the tax administrator of 3356
any other municipal corporation.3357

       (I) A tax administrator shall make available the text of all 3358
opinions issued under this section, except those opinions prepared 3359
for a taxpayer who has requested that the text of the opinion 3360
remain confidential. In no event shall the text of an opinion be 3361
made available until the tax administrator has removed all 3362
information that identifies the taxpayer and any other parties 3363
involved in the activity or transaction.3364

        (J) An opinion of the tax administrator issued under this 3365
section may not be appealed.3366

       Sec. 718.41.  (A) A taxpayer shall file an amended return 3367
with the tax administrator in such form as the tax administrator 3368
requires if any of the facts, figures, computations, or 3369
attachments required in the taxpayer's annual return to determine 3370
the tax due levied by the municipal corporation in accordance with 3371
this chapter must be altered as the result of an adjustment to the 3372
taxpayer's federal income tax return, whether initiated by the 3373
taxpayer or the internal revenue service, and such alteration 3374
affects the taxpayer's tax liability under this chapter. If a 3375
taxpayer intends to file an amended consolidated municipal income 3376
tax return, the taxpayer shall notify the tax administrator before 3377
filing the amended return.3378

       (B)(1) In the case of an underpayment, the amended return 3379
shall be accompanied by payment of any combined additional tax due 3380
together with interest thereon. If the combined tax shown to be 3381
due is ten dollars or less, such amount need not accompany the 3382
amended return. Except as provided under division (B)(2) of this 3383
section, the amended return shall not reopen those facts, figures, 3384
computations, or attachments from a previously filed return that 3385
are not affected, either directly or indirectly, by the adjustment 3386
to the taxpayer's federal or state income tax return unless the 3387
applicable statute of limitations for civil actions or 3388
prosecutions under section 718.12 of the Revised Code has not 3389
expired for a previously filed return.3390

       (2) The additional tax to be paid shall not exceed the amount 3391
of tax that would be due if all facts, figures, computations, and 3392
attachments were reopened.3393

       (C)(1) In the case of an overpayment, an application for 3394
refund may be filed under this division within the period 3395
prescribed by section 718.12 of the Revised Code for filing the 3396
amended return even if it is filed beyond the period prescribed in 3397
section 718.19 of the Revised Code if it otherwise conforms to the 3398
requirements of that section. If the amount of the refund is ten 3399
dollars or less, no refund need be paid by the municipal 3400
corporation to the taxpayer. Except as set forth in division 3401
(C)(2) of this section, an application filed under this division 3402
shall claim refund of overpayments resulting from alterations to 3403
only those facts, figures, computations, or attachments required 3404
in the taxpayer's annual return that are affected, either directly 3405
or indirectly, by the adjustment to the taxpayer's federal or 3406
state income tax return unless it is also filed within the time 3407
prescribed in section 718.19 of the Revised Code. Except as set 3408
forth in division (C)(2) of this section, the application shall 3409
not reopen those facts, figures, computations, or attachments that 3410
are not affected, either directly or indirectly, by the adjustment 3411
to the taxpayer's federal or state income tax return.3412

       (2) The amount to be refunded shall not exceed the amount of 3413
refund that would be due if all facts, figures, computations, and 3414
attachments were reopened.3415

       Sec. 718.04.        Sec. 718.50.  (A) No municipal corporation other than 3416
the municipal corporation of residence shall levy a tax on the 3417
income of any member or employee of the Ohio general assembly 3418
including the lieutenant governor which income is received as a 3419
result of services rendered as such member or employee and is paid 3420
from appropriated funds of this state.3421

       (B) No municipal corporation other than the municipal 3422
corporation of residence and the city of Columbus shall levy a tax 3423
on the income of the chief justice or a justice of the supreme 3424
court received as a result of services rendered as the chief 3425
justice or justice. No municipal corporation other than the 3426
municipal corporation of residence shall levy a tax on the income 3427
of a judge sitting by assignment of the chief justice or on the 3428
income of a district court of appeals judge sitting in multiple 3429
locations within the district, received as a result of services 3430
rendered as a judge.3431

       Sec. 718.99.  (A) Except as provided in division (B) of this 3432
section, whoever violates section 718.35 of the Revised Code, 3433
division (A) of section 718.13 of the Revised Code, or section 3434
718.03 of the Revised Code by failing to remit municipal income 3435
taxes deducted and withheld from an employee, shall be guilty of a 3436
misdemeanor of the first degree and shall be subject to a fine of 3437
one thousand dollars or imprisonment for a term of up to six 3438
months, or both, unless the violation is punishable by a municipal 3439
ordinance or resolution imposing a greater penalty or requiring 3440
dismissal from office or discharge from employment, or both, in 3441
which case the municipal ordinance or resolution shall govern.3442

       (B) Any person who discloses information received from the 3443
Internal Revenue Service in violation of division (A) of section 3444
718.13 of the Revised Code shall be guilty of a felony of the 3445
fifth degree and shall be subject to a fine of not more than five 3446
thousand dollars plus the costs of prosecution, or imprisonment 3447
for a term not exceeding five years, or both, unless the violation 3448
is punishable by a municipal ordinance imposing a greater penalty 3449
or requiring dismissal from office or discharge from employment, 3450
or both, in which case the municipal ordinance shall govern. 3451

       (C) Each instance of access or disclosure in violation of 3452
division (A) of section 718.13 of the Revised Code constitutes a 3453
separate offense.3454

       (D) Nothing in this chapter prohibits a municipal corporation 3455
from prosecuting offenses which are made punishable under a 3456
municipal ordinance or resolution levying an income tax and for 3457
which no other penalty is provided under this chapter.3458

       Sec. 5703.059. (A) The tax commissioner may adopt rules 3459
requiring returns, including any accompanying schedule or 3460
statement, for any of the following taxes to be filed 3461
electronically using the Ohio business gateway as defined in 3462
section 718.051718.01 of the Revised Code, filed telephonically 3463
using the system known as the Ohio telefile system, or filed by 3464
any other electronic means prescribed by the commissioner:3465

       (1) Employer income tax withholding under Chapter 5747. of 3466
the Revised Code;3467

       (2) Motor fuel tax under Chapter 5735. of the Revised Code;3468

       (3) Cigarette and tobacco product tax under Chapter 5743. of 3469
the Revised Code;3470

       (4) Severance tax under Chapter 5749. of the Revised Code;3471

       (5) Use tax under Chapter 5741. of the Revised Code;3472

       (6) Commercial activity tax under Chapter 5751. of the 3473
Revised Code;3474

       (7) Financial institutions tax under Chapter 5726. of the 3475
Revised Code;3476

       (8) Motor fuel receipts tax under Chapter 5736. of the 3477
Revised Code;3478

       (9) Horse-racing taxes under Chapter 3769. of the Revised 3479
Code.3480

       (B) The tax commissioner may adopt rules requiring any 3481
payment of tax shown on such a return to be due to be made 3482
electronically in a manner approved by the commissioner.3483

       (C) A rule adopted under this section does not apply to 3484
returns or reports filed or payments made before six months after 3485
the effective date of the rule. The commissioner shall publicize 3486
any new electronic filing requirement on the department's web 3487
site. The commissioner shall educate the public of the requirement 3488
through seminars, workshops, conferences, or other outreach 3489
activities.3490

       (D) Any person required to file returns and make payments 3491
electronically under rules adopted under this section may apply to 3492
the commissioner, on a form prescribed by the commissioner, to be 3493
excused from that requirement. For good cause shown, the 3494
commissioner may excuse the applicant from the requirement and 3495
permit the applicant to file the returns or reports or make the 3496
payments required under this section by nonelectronic means.3497

       Sec. 5703.57. (A) As used in this section, "Ohio business 3498
gateway" has the same meaning as in section 718.051 of the Revised 3499
Code.3500

        (B) There is hereby created the Ohio business gateway 3501
steering committee to direct the continuing development of the 3502
Ohio business gateway and to oversee its operations. The committee 3503
shall provide general oversight regarding operation of the Ohio 3504
business gateway and shall recommend to the department of 3505
administrative services enhancements that will improve the Ohio 3506
business gateway. The committee shall consider all banking, 3507
technological, administrative, and other issues associated with 3508
the Ohio business gateway and shall make recommendations regarding 3509
the type of reporting forms or other tax documents to be filed 3510
through the Ohio business gateway.3511

        (C) The committee shall consist of:3512

        (1) The following members, appointed by the governor with the 3513
advice and consent of the senate:3514

        (a) Not more than four representatives of the business 3515
community;3516

        (b) Not more than one representativethree representatives of 3517
municipal tax administrators selected from a list of candidates 3518
provided by the Ohio municipal league; and3519

        (c) Not more than two tax practitioners.3520

        (2) The following ex officio members:3521

        (a) The director or other highest officer of each state 3522
agency that has tax reporting forms or other tax documents filed 3523
with it through the Ohio business gateway or the director's 3524
designee;3525

        (b) The secretary of state or the secretary of state's 3526
designee;3527

        (c) The treasurer of state or the treasurer of state's 3528
designee;3529

        (d) The director of budget and management or the director's 3530
designee;3531

        (e) The state chief information officer or the officer's 3532
designee; 3533

        (f) The tax commissioner or the tax commissioner's designee; 3534
and3535

       (g) The director of development or the director's designee.3536

        An appointed member shall serve until the member resigns or 3537
is removed by the governor. Vacancies shall be filled in the same 3538
manner as original appointments.3539

        (D) A vacancy on the committee does not impair the right of 3540
the other members to exercise all the functions of the committee. 3541
The presence of a majority of the members of the committee 3542
constitutes a quorum for the conduct of business of the committee. 3543
The concurrence of at least a majority of the members of the 3544
committee is necessary for any action to be taken by the 3545
committee. On request, each member of the committee shall be 3546
reimbursed for the actual and necessary expenses incurred in the 3547
discharge of the member's duties.3548

        (E) The committee is a part of the department of taxation for 3549
administrative purposes.3550

        (F) Each year, the governor shall select a member of the 3551
committee to serve as chairperson. The chairperson shall appoint 3552
an official or employee of the department of taxation to act as 3553
the committee's secretary. The secretary shall keep minutes of the 3554
committee's meetings and a journal of all meetings, proceedings, 3555
findings, and determinations of the committee.3556

        (G) The committee may hire professional, technical, and 3557
clerical staff needed to support its activities.3558

        (H) The committee shall meet as often as necessary to perform 3559
its duties.3560

       Sec. 5717.011.  (A) As used in this chapter, "tax 3561
administrator" has the same meaning as in section 718.01 of the 3562
Revised Code.3563

       (B) Appeals from a municipaldecision of a local board of 3564
appealtax review created under section 718.11 of the Revised Code 3565
may be taken by the taxpayer or the tax administrator to the board 3566
of tax appeals or may be taken by the taxpayer or the tax 3567
administrator to a court of common pleas as otherwise provided by 3568
law. If the taxpayer or the tax administrator elects to make an 3569
appeal to the board of tax appeals or court of common pleas, and 3570
subject to section 5703.021 of the Revised Code with respect to 3571
appeals assigned to the small claims docket, the appeal shall be 3572
taken by the filing of a notice of appeal with the board of tax 3573
appeals or court of common pleas, the municipallocal board of 3574
appealtax review, and the opposing party. The notice of appeal 3575
shall be filed within sixty days after the day the appellant 3576
receives notice of the decision issued under section 718.11 of the 3577
Revised Code. An appeal filed with a court of common pleas is 3578
governed by the Rules of Civil Procedure and other rules of 3579
practice and procedure applicable to civil actions. For an appeal 3580
filed with the board of tax appeals, the notice of appeal may be 3581
filed in person or by certified mail, express mail, facsimile 3582
transmission, electronic transmission, or by authorized delivery 3583
service as provided in section 5703.056 of the Revised Code. If 3584
the notice of appeal is filed by certified mail, express mail, or 3585
authorized delivery service as provided in section 5703.056 of the 3586
Revised Code, the date of the United States postmark placed on the 3587
sender's receipt by the postal service or the date of receipt 3588
recorded by the authorized delivery service shall be treated as 3589
the date of filing with the board. If notice of appeal is filed by 3590
facsimile transmission or electronic transmission, the date and 3591
time the notice is received by the board shall be the date and 3592
time reflected on a timestamp provided by the board's electronic 3593
system, and the appeal shall be considered filed with the board on 3594
the date reflected on that timestamp. Any timestamp provided by 3595
another computer system or electronic submission device shall not 3596
affect the time and date the notice is received by the board. The 3597
notice of appeal shall have attached thereto and incorporated 3598
therein by reference a true copy of the decision issued under 3599
section 718.11 of the Revised Code, but failure to attach a copy 3600
of such notice and incorporate it by reference in the notice of 3601
appeal does not invalidate the appeal.3602

       (C) A notice of appeal for an appeal filed with the board of 3603
tax appeals shall contain a short and plain statement of the 3604
claimed errors in the decision of the municipallocal board of 3605
appealtax review showing that the appellant is entitled to relief 3606
and a demand for the relief to which the appellant claims to be 3607
entitled. An appellant may amend the notice of appeal once as a 3608
matter of course within sixty days after the certification of the 3609
transcript. Otherwise, an appellant may amend the notice of appeal 3610
only after receiving leave of the board or the written consent of 3611
each adverse party. Leave of the board shall be freely given when 3612
justice so requires.3613

       (D) Upon the filing of a notice of appeal with the board of 3614
tax appeals, the municipallocal board of appealtax review shall 3615
certify to the board of tax appeals a transcript of the record of 3616
the proceedings before it, together with all evidence considered 3617
by it in connection therewith. Such appeals may be heard by the 3618
board at its office in Columbus or in the county where the 3619
appellant resides, or it may cause its examiners to conduct such 3620
hearings and to report to it their findings for affirmation or 3621
rejection. The board may order the appeal to be heard upon the 3622
record and the evidence certified to it by the tax administrator, 3623
but upon the application of any interested party the board shall 3624
order the hearing of additional evidence, and the board may make 3625
such investigation concerning the appeal as it considers proper. 3626
An appeal may proceed pursuant to section 5703.021 of the Revised 3627
Code on the small claims docket if the appeals qualifies under 3628
that section.3629

       (E) If an issue being appealed under this section is 3630
addressed in a municipal corporation's ordinance or regulation, 3631
the tax administrator, upon the request of the board of tax 3632
appeals, shall provide a copy of the ordinance or regulation to 3633
the board of tax appeals.3634

       Sec. 5717.03. (A) A decision of the board of tax appeals on 3635
an appeal filed with it pursuant to section 5717.01, 5717.011, or 3636
5717.02 of the Revised Code shall be entered of record on the 3637
journal together with the date when the order is filed with the 3638
secretary for journalization.3639

       (B) In case of an appeal from a decision of a county board of 3640
revision, the board of tax appeals shall determine the taxable 3641
value of the property whose valuation or assessment by the county 3642
board of revision is complained of, or in the event the complaint 3643
and appeal is against a discriminatory valuation, shall determine 3644
a valuation which shall correct such discrimination, and shall 3645
determine the liability of the property for taxation, if that 3646
question is in issue, and the board of tax appeals' decision and 3647
the date when it was filed with the secretary for journalization 3648
shall be sent by the board to all persons who were parties to the 3649
appeal before the board, to the person in whose name the property 3650
is listed, or sought to be listed, if such person is not a party 3651
to the appeal, to the county auditor of the county in which the 3652
property involved in the appeal is located, and to the tax 3653
commissioner.3654

       In correcting a discriminatory valuation, the board of tax 3655
appeals shall increase or decrease the value of the property whose 3656
valuation or assessment by the county board of revision is 3657
complained of by a per cent or amount which will cause such 3658
property to be listed and valued for taxation by an equal and 3659
uniform rule.3660

       (C) In the case of an appeal from a review, redetermination, 3661
or correction of a tax assessment, valuation, determination, 3662
finding, computation, or order of the tax commissioner, the order 3663
of the board of tax appeals and the date of the entry thereof upon 3664
its journal shall be sent by the board to all persons who were 3665
parties to the appeal before the board, the person in whose name 3666
the property is listed or sought to be listed, if the decision 3667
determines the valuation or liability of property for taxation and 3668
if such person is not a party to the appeal, the taxpayer or other 3669
person to whom notice of the tax assessment, valuation, 3670
determination, finding, computation, or order, or correction or 3671
redetermination thereof, by the tax commissioner was by law 3672
required to be given, the director of budget and management, if 3673
the revenues affected by such decision would accrue primarily to 3674
the state treasury, and the county auditors of the counties to the 3675
undivided general tax funds of which the revenues affected by such 3676
decision would primarily accrue.3677

       (D) In the case of an appeal from a municipaldecision of a 3678
local board of appealtax review created under section 718.11 of 3679
the Revised Code, the order of the board of tax appeals and the 3680
date of the entry thereof upon the board's journal shall be sent 3681
by the board to all persons who were parties to the appeal before 3682
the board.3683

       (E) In the case of all other appeals or applications filed 3684
with and determined by the board, the board's order and the date 3685
when the order was filed by the secretary for journalization shall 3686
be sent by the board to the person who is a party to such appeal 3687
or application, to such persons as the law requires, and to such 3688
other persons as the board deems proper.3689

       (F) The orders of the board may affirm, reverse, vacate, 3690
modify, or remand the tax assessments, valuations, determinations, 3691
findings, computations, or orders complained of in the appeals 3692
determined by the board, and the board's decision shall become 3693
final and conclusive for the current year unless reversed, 3694
vacated, or modified as provided in section 5717.04 of the Revised 3695
Code. When an order of the board becomes final the tax 3696
commissioner and all officers to whom such decision has been sent 3697
shall make the changes in their tax lists or other records which 3698
the decision requires.3699

       (G) If the board finds that issues not raised on the appeal 3700
are important to a determination of a controversy, the board may 3701
remand the cause for an administrative determination and the 3702
issuance of a new tax assessment, valuation, determination, 3703
finding, computation, or order, unless the parties stipulate to 3704
the determination of such other issues without remand. An order 3705
remanding the cause is a final order. If the order relates to any 3706
issue other than a municipal income tax matter appealed under 3707
sections 718.11 and 5717.011 of the Revised Code, the order may be 3708
appealed to the court of appeals in Franklin county. If the order 3709
relates to a municipal income tax matter appealed under sections 3710
718.11 and 5717.011 of the Revised Code, the order may be appealed 3711
to the court of appeals for the county in which the municipal 3712
corporation in which the dispute arose is primarily situated.3713

       (H) At the request of any person that filed an appeal subject 3714
to this section, the decision or order of the board of tax appeals 3715
issued pursuant to division (B), (C), (D), or (E) of this section 3716
shall be sent by certified mail at the requestor's expense.3717

       Sec. 5739.12. (A)(1) Each person who has or is required to 3718
have a vendor's license, on or before the twenty-third day of each 3719
month, shall make and file a return for the preceding month in the 3720
form prescribed by the tax commissioner, and shall pay the tax 3721
shown on the return to be due. The return shall be filed 3722
electronically using the Ohio business gateway, as defined in 3723
section 718.051718.01 of the Revised Code, the Ohio telefile 3724
system, or any other electronic means prescribed by the 3725
commissioner. Payment of the tax shown on the return to be due 3726
shall be made electronically in a manner approved by the 3727
commissioner. The commissioner may require a vendor that operates 3728
from multiple locations or has multiple vendor's licenses to 3729
report all tax liabilities on one consolidated return. The return 3730
shall show the amount of tax due from the vendor to the state for 3731
the period covered by the return and such other information as the 3732
commissioner deems necessary for the proper administration of this 3733
chapter. The commissioner may extend the time for making and 3734
filing returns and paying the tax, and may require that the return 3735
for the last month of any annual or semiannual period, as 3736
determined by the commissioner, be a reconciliation return 3737
detailing the vendor's sales activity for the preceding annual or 3738
semiannual period. The reconciliation return shall be filed by the 3739
last day of the month following the last month of the annual or 3740
semiannual period. The commissioner may remit all or any part of 3741
amounts or penalties that may become due under this chapter and 3742
may adopt rules relating thereto. Such return shall be filed 3743
electronically as directed by the tax commissioner, and payment of 3744
the amount of tax shown to be due thereon, after deduction of any 3745
discount provided for under this section, shall be made 3746
electronically in a manner approved by the tax commissioner.3747

       (2) Any person required to file returns and make payments 3748
electronically under division (A)(1) of this section may apply to 3749
the tax commissioner on a form prescribed by the commissioner to 3750
be excused from that requirement. For good cause shown, the 3751
commissioner may excuse the person from that requirement and may 3752
permit the person to file the returns and make the payments 3753
required by this section by nonelectronic means.3754

       (B)(1) If the return is filed and the amount of tax shown 3755
thereon to be due is paid on or before the date such return is 3756
required to be filed, the vendor shall be entitled to a discount 3757
of three-fourths of one per cent of the amount shown to be due on 3758
the return.3759

       (2) A vendor that has selected a certified service provider 3760
as its agent shall not be entitled to the discount if the 3761
certified service provider receives a monetary allowance pursuant 3762
to section 5739.06 of the Revised Code for performing the vendor's 3763
sales and use tax functions in this state. Amounts paid to the 3764
clerk of courts pursuant to section 4505.06 of the Revised Code 3765
shall be subject to the applicable discount. The discount shall be 3766
in consideration for prompt payment to the clerk of courts and for 3767
other services performed by the vendor in the collection of the 3768
tax.3769

       (C)(1) Upon application to the tax commissioner, a vendor who 3770
is required to file monthly returns may be relieved of the 3771
requirement to report and pay the actual tax due, provided that 3772
the vendor agrees to remit to the commissioner payment of not less 3773
than an amount determined by the commissioner to be the average 3774
monthly tax liability of the vendor, based upon a review of the 3775
returns or other information pertaining to such vendor for a 3776
period of not less than six months nor more than two years 3777
immediately preceding the filing of the application. Vendors who 3778
agree to the above conditions shall make and file an annual or 3779
semiannual reconciliation return, as prescribed by the 3780
commissioner. The reconciliation return shall be filed 3781
electronically as directed by the tax commissioner, and payment of 3782
the amount of tax shown to be due thereon, after deduction of any 3783
discount provided in this section, shall be made electronically in 3784
a manner approved by the commissioner. Failure of a vendor to 3785
comply with any of the above conditions may result in immediate 3786
reinstatement of the requirement of reporting and paying the 3787
actual tax liability on each monthly return, and the commissioner 3788
may at the commissioner's discretion deny the vendor the right to 3789
report and pay based upon the average monthly liability for a 3790
period not to exceed two years. The amount ascertained by the 3791
commissioner to be the average monthly tax liability of a vendor 3792
may be adjusted, based upon a review of the returns or other 3793
information pertaining to the vendor for a period of not less than 3794
six months nor more than two years preceding such adjustment.3795

       (2) The commissioner may authorize vendors whose tax 3796
liability is not such as to merit monthly returns, as ascertained 3797
by the commissioner upon the basis of administrative costs to the 3798
state, to make and file returns at less frequent intervals. When 3799
returns are filed at less frequent intervals in accordance with 3800
such authorization, the vendor shall be allowed the discount 3801
provided in this section in consideration for prompt payment with 3802
the return, provided the return is filed and payment is made of 3803
the amount of tax shown to be due thereon, at the time specified 3804
by the commissioner, but a vendor that has selected a certified 3805
service provider as its agent shall not be entitled to the 3806
discount.3807

       (D) Any vendor who fails to file a return or to pay the full 3808
amount of the tax shown on the return to be due in the manner 3809
prescribed under this section and the rules of the commissioner 3810
may, for each such return, be required to forfeit and pay into the 3811
state treasury an additional charge not exceeding fifty dollars or 3812
ten per cent of the tax required to be paid for the reporting 3813
period, whichever is greater, as revenue arising from the tax 3814
imposed by this chapter, and such sum may be collected by 3815
assessment in the manner provided in section 5739.13 of the 3816
Revised Code. The commissioner may remit all or a portion of the 3817
additional charge and may adopt rules relating to the imposition 3818
and remission of the additional charge.3819

       (E) If the amount required to be collected by a vendor from 3820
consumers is in excess of the applicable percentage of the 3821
vendor's receipts from sales that are taxable under section 3822
5739.02 of the Revised Code, or in the case of sales subject to a 3823
tax levied pursuant to section 5739.021, 5739.023, or 5739.026 of 3824
the Revised Code, in excess of the percentage equal to the 3825
aggregate rate of such taxes and the tax levied by section 5739.02 3826
of the Revised Code, such excess shall be remitted along with the 3827
remittance of the amount of tax due under section 5739.10 of the 3828
Revised Code.3829

       (F) The commissioner, if the commissioner deems it necessary 3830
in order to insure the payment of the tax imposed by this chapter, 3831
may require returns and payments to be made for other than monthly 3832
periods.3833

       (G) Any vendor required to file a return and pay the tax 3834
under this section whose total payment for a year equals or 3835
exceeds the amount shown in division (A) of section 5739.122 of 3836
the Revised Code is subject to the accelerated tax payment 3837
requirements in divisions (B) and (C) of that section. For a 3838
vendor that operates from multiple locations or has multiple 3839
vendor's licenses, in determining whether the vendor's total 3840
payment equals or exceeds the amount shown in division (A) of that 3841
section, the vendor's total payment amount shall be the amount of 3842
the vendor's total tax liability for the previous calendar year 3843
for all of the vendor's locations or licenses.3844

       Sec. 5739.124.  (A) If required by the tax commissioner, a 3845
permit holder required to make payments under section 5739.032 of 3846
the Revised Code shall file all returns and reports 3847
electronically. The commissioner may require the permit holder to 3848
use the Ohio business gateway, as defined in section 718.0513849
718.01 of the Revised Code, or any other electronic means approved 3850
by the commissioner, to file the returns and reports, or to remit 3851
the tax, in lieu of the manner prescribed under section 5739.032 3852
of the Revised Code.3853

       (B) A person required under this section to file reports and 3854
returns electronically may apply to the tax commissioner to be 3855
excused from that requirement. Applications shall be made on a 3856
form prescribed by the commissioner. The commissioner may approve 3857
the application for good cause.3858

       (C)(1) If a person required to file a report or return 3859
electronically under this section fails to do so, the tax 3860
commissioner may impose an additional charge not to exceed the 3861
following:3862

       (a) For each of the first two failures, five per cent of the 3863
amount required to be reported on the report or return;3864

       (b) For the third and any subsequent failure, ten per cent of 3865
the amount required to be reported on the report or return.3866

       (2) The charges authorized under division (C)(1) of this 3867
section are in addition to any other charge or penalty authorized 3868
under this chapter, and shall be considered as revenue arising 3869
from taxes imposed under this chapter. An additional charge may be 3870
collected by assessment in the manner prescribed by section 3871
5739.13 of the Revised Code. The commissioner may waive all or a 3872
portion of such a charge and may adopt rules governing such 3873
waiver.3874

       Sec. 5741.122.  (A) If required by the tax commissioner, a 3875
person required to make payments under section 5741.121 of the 3876
Revised Code shall file all returns and reports electronically. 3877
The commissioner may require the person to use the Ohio business 3878
gateway, as defined in section 718.051718.01 of the Revised Code, 3879
or any other electronic means approved by the commissioner, to 3880
file the returns and reports, or to remit the tax, in lieu of the 3881
manner prescribed under section 5741.121 of the Revised Code.3882

       (B) A person required under this section to file reports and 3883
returns electronically may apply to the tax commissioner to be 3884
excused from that requirement. Applications shall be made on a 3885
form prescribed by the commissioner. The commissioner may approve 3886
the application for good cause.3887

       (C)(1) If a person required to file a report or return 3888
electronically under this section fails to do so, the tax 3889
commissioner may impose an additional charge not to exceed the 3890
following:3891

       (a) For each of the first two failures, five per cent of the 3892
amount required to be reported on the report or return;3893

       (b) For the third and any subsequent failure, ten per cent of 3894
the amount required to be reported on the report or return.3895

       (2) The charges authorized under division (C)(1) of this 3896
section are in addition to any other charge or penalty authorized 3897
under this chapter, and shall be considered as revenue arising 3898
from taxes imposed under this chapter. An additional charge may be 3899
collected by assessment in the manner prescribed by section 3900
5741.13 of the Revised Code. The commissioner may waive all or a 3901
portion of such a charge and may adopt rules governing such 3902
waiver.3903

       Sec. 5747.063.  (A)(1) If a person's winnings at a casino 3904
facility are an amount for which reporting to the internal revenue 3905
service of the amount is required by section 6041 of the Internal 3906
Revenue Code, as amended, the casino operator shall deduct and 3907
withhold Ohio income tax from the person's winnings at a rate of 3908
four per cent of the amount won and shall deduct and withhold 3909
municipal income tax from the person's winnings at the rate of tax 3910
of the municipal corporation in which the casino facility is 3911
located. A person's amount of winnings shall be determined each 3912
time the person exchanges amounts won in tokens, chips, casino 3913
credit, or other prepaid representations of value for cash or a 3914
cash equivalent. The casino operator shall issue, to a person from 3915
whose winnings an amount has been deducted and withheld, a receipt 3916
for the amount deducted and withheld, and also shall obtain from 3917
the person additional information that will be necessary for the 3918
casino operator to prepare the returns required by this section.3919

       (2) If a person's winnings at a casino facility require 3920
reporting to the internal revenue service under division (A)(1) of 3921
this section, the casino operator also shall require the person to 3922
state in writing, under penalty of falsification, whether the 3923
person is in default under a support order.3924

       (B) Amounts deducted and withheld by a casino operator are 3925
held in trust for the benefit of the state and municipal 3926
corporations, as applicable.3927

       (1) On or before the tenth day of each month, the casino 3928
operator shall file a return electronically with the tax 3929
commissioner and the tax administrator of the municipal 3930
corporation, as applicable, identifying the persons from whose 3931
winnings amounts were deducted and withheld, the amount of each 3932
such deduction and withholding during the preceding calendar 3933
month, the amount of the winnings from which each such amount was 3934
withheld, the type of casino gaming that resulted in such 3935
winnings, and any other information required by the tax 3936
commissioner. With the return, the casino operator shall remit 3937
electronically to the commissioner and the tax administrator of 3938
the municipal corporation, as applicable, all the amounts deducted 3939
and withheld during the preceding month. 3940

       (2)(a) A casino operator shall maintain a record of each 3941
written statement provided under division (A)(2) of this section 3942
in which a person admits to being in default under a support 3943
order. The casino operator shall make these records available to 3944
the director of job and family services upon request.3945

        (b) A casino operator shall maintain copies of receipts 3946
issued under division (A)(1) of this section and of written 3947
statements provided under division (A)(2) of this section and 3948
shall make these copies available to the tax commissioner upon 3949
request.3950

        (c) A casino operator shall maintain the information 3951
described in divisions (B)(2)(a) and (b) of this section in 3952
accordance with section 5747.17 of the Revised Code and any rules 3953
adopted pursuant thereto.3954

       (3) Annually, on or before the thirty-first day of January, a 3955
casino operator shall file an annual return electronically with 3956
the tax commissioner and the tax administrator of the municipal 3957
corporation, as applicable, indicating the total amount deducted 3958
and withheld during the preceding calendar year. The casino 3959
operator shall remit electronically with the annual return any 3960
amount that was deducted and withheld and that was not previously 3961
remitted. If the identity of a person and the amount deducted and 3962
withheld with respect to that person were omitted on a monthly 3963
return, that information shall be indicated on the annual return. 3964

       (4)(a) A casino operator who fails to file a return and remit 3965
the amounts deducted and withheld is personally liable for the 3966
amount deducted and withheld and not remitted. The commissioner 3967
and the tax administrator of the municipal corporation, as 3968
applicable, may impose a penalty up to one thousand dollars if a 3969
return is filed late, if amounts deducted and withheld are 3970
remitted late, if a return is not filed, or if amounts deducted 3971
and withheld are not remitted. Interest accrues on past due 3972
amounts deducted and withheld at the rate prescribed in section 3973
5703.47 of the Revised Code. The commissioner and the tax 3974
administrator of the municipal corporation, as applicable, may 3975
collect past due amounts deducted and withheld and penalties and 3976
interest thereon by assessment under section 5747.13 of the 3977
Revised Code as if they were income taxes collected by an 3978
employer.3979

       (b) If a casino operator sells the casino facility or 3980
otherwise quits the casino business, the amounts deducted and 3981
withheld and any penalties and interest thereon are immediately 3982
due and payable. The successor shall withhold an amount of the 3983
purchase money that is sufficient to cover the amounts deducted 3984
and withheld and penalties and interest thereon until the 3985
predecessor casino operator produces either a receipt from the 3986
commissioner and the tax administrator of the municipal 3987
corporation, as applicable, showing that the amounts deducted and 3988
withheld and penalties and interest thereon have been paid or a 3989
certificate from the commissioner and the tax administrator of the 3990
municipal corporation, as applicable, indicating that no amounts 3991
deducted and withheld or penalties and interest thereon are due. 3992
If the successor fails to withhold purchase money, the successor 3993
is personally liable for payment of the amounts deducted and 3994
withheld and penalties and interest thereon, up to the amount of 3995
the purchase money.3996

       (C)(1) Annually, on or before the thirty-first day of 3997
January, a casino operator shall issue an information return to 3998
each person with respect to whom an amount has been deducted and 3999
withheld during the preceding calendar year. The information 4000
return shall show the total amount deducted from the person's 4001
winnings by the casino operator during the preceding calendar 4002
year.4003

       (2) Annually, on or before the thirty-first day of January, a 4004
casino operator shall provide to the commissioner a copy of each 4005
information return issued under division (C)(1) of this section 4006
for the preceding calendar year. The commissioner may require that 4007
the copies be transmitted electronically.4008

       (D) Amounts deducted and withheld shall be allowed as a 4009
credit against payment of the tax imposed by section 5747.02 of 4010
the Revised Code and shall be treated as taxes paid for purposes 4011
of section 5747.09 of the Revised Code. This division applies only 4012
to the person for whom the amount is deducted and withheld. 4013

       (E) The failure of a casino operator to deduct and withhold 4014
the required amount from a person's winnings does not relieve the 4015
person from liability for the tax imposed by section 5747.02 of 4016
the Revised Code with respect to those winnings. And compliance 4017
with this section does not relieve a casino operator or a person 4018
who has winnings at a casino facility from compliance with 4019
relevant provisions of federal tax laws.4020

       (F) The commissioner and the tax administrator of the 4021
municipal corporation, as applicable, shall prescribe the form of 4022
the receipt and returns required by this section. The director of 4023
job and family services shall prescribe the form of the statement 4024
required by this section.4025

        (G) The requirements imposed under this section are in 4026
addition to the municipal income tax withholding requirements 4027
under section 718.031 of the Revised Code.4028

       (H) The commissioner may adopt rules that are necessary to 4029
administer this section.4030

       Sec. 5747.064. (A) As used in this section, "video lottery 4031
terminal" has the same meaning as in section 3770.21 of the 4032
Revised Code.4033

       (B) If a person's prize award from a video lottery terminal 4034
is an amount for which reporting to the internal revenue service 4035
of the amount is required by section 6041 of the Internal Revenue 4036
Code, as amended, the lottery sales agent shall deduct and 4037
withhold Ohio income tax from the person's prize award at a rate 4038
of four per cent of the amount won and shall deduct and withhold 4039
municipal income tax from the person's winnings at the rate of tax 4040
of the municipal corporation in which the video lottery terminal 4041
facility is located. The lottery sales agent shall issue, to a 4042
person from whose prize award an amount has been deducted or 4043
withheld, a receipt for the amount deducted and withheld, and also 4044
shall obtain from the person additional information that will be 4045
necessary for the lottery sales agent to prepare the returns 4046
required by this section.4047

       (C) Amounts deducted and withheld by a lottery sales agent 4048
are held in trust for the benefit of the state and municipal 4049
corporations, as applicable.4050

        (1) On or before the tenth day of each month, the lottery 4051
sales agent shall file a return electronically with the tax 4052
commissioner and the tax administrator of the municipal 4053
corporation, as applicable, identifying the persons from whose 4054
prize awards amounts were deducted and withheld, the amount of 4055
each such deduction and withholding during the preceding month, 4056
the amount of the prize award from which each such amount was 4057
withheld, and any other information required by the commissioner 4058
and the tax administrator of the municipal corporation, as 4059
applicable. With the return, the lottery sales agent shall remit 4060
electronically to the commissioner and the tax administrator of 4061
the municipal corporation, as applicable, all the amounts deducted 4062
and withheld during the preceding month.4063

       (2) A lottery sales agent shall maintain a record of all 4064
receipts issued under division (B) of this section and shall make 4065
those records available to the commissioner and the tax 4066
administrator of the municipal corporation, as applicable, upon 4067
request. Such records shall be maintained in accordance with 4068
section 5747.17 of the Revised Code and any rules adopted pursuant 4069
thereto.4070

        (3) Annually, on or before the thirty-first day of January, a 4071
lottery sales agent shall file an annual return electronically 4072
with the tax commissioner and the tax administrator of the 4073
municipal corporation, as applicable, indicating the total amount 4074
deducted and withheld during the preceding calendar year. The 4075
lottery sales agent shall remit electronically with the annual 4076
return any amount that was deducted and withheld and that was not 4077
previously remitted. If the identity of a person and the amount 4078
deducted and withheld with respect to that person were omitted on 4079
a monthly return, that information shall be indicated on the 4080
annual return.4081

        (4)(a) A lottery sales agent who fails to file a return and 4082
remit the amounts deducted and withheld is personally liable for 4083
the amount deducted and withheld and not remitted. The 4084
commissioner and the tax administrator of the municipal 4085
corporation, as applicable, may impose a penalty of up to one 4086
thousand dollars if a return is filed late, if amounts deducted 4087
and withheld are remitted late, if a return is not filed, or if 4088
amounts deducted and withheld are not remitted. Interest accrues 4089
on past due amounts deducted and withheld at the rate prescribed 4090
in section 5703.47 of the Revised Code. The commissioner and the 4091
tax administrator of the municipal corporation, as applicable, may 4092
collect past due amounts deducted and withheld and penalties and 4093
interest thereon by assessment under section 5747.13 of the 4094
Revised Code as if they were income taxes collected by an 4095
employer.4096

        (b) If a lottery sales agent ceases to operate video lottery 4097
terminals, the amounts deducted and withheld and any penalties and 4098
interest thereon are immediately due and payable. A successor of 4099
the lottery sales agent that purchases the video lottery terminals 4100
from the agent shall withhold an amount of the purchase money that 4101
is sufficient to cover the amounts deducted and withheld and 4102
penalties and interest thereon until the predecessor lottery sales 4103
agent produces either a receipt from the tax commissioner and the 4104
tax administrator of the municipal corporation, as applicable,4105
showing that the amounts deducted and withheld and penalties and 4106
interest thereon have been paid or a certificate from the 4107
commissioner and the tax administrator of the municipal 4108
corporation, as applicable, indicating that no amounts deducted 4109
and withheld or penalties and interest thereon are due. If the 4110
successor fails to withhold purchase money, the successor is 4111
personally liable for payment of the amounts deducted and withheld 4112
and penalties and interest thereon, up to the amount of the 4113
purchase money.4114

        (D)(1) Annually, on or before the thirty-first day of 4115
January, a lottery sales agent shall issue an information return 4116
to each person with respect to whom an amount has been deducted 4117
and withheld during the preceding calendar year. The information 4118
return shall show the total amount deducted from the person's 4119
prize award by the lottery sales agent during the preceding year.4120

        (2) Annually, on or before the thirty-first day of January, a 4121
lottery sales agent shall provide to the tax commissioner and the 4122
tax administrator of the municipal corporation, as applicable, a 4123
copy of each information return issued under division (D)(1) of 4124
this section for the preceding calendar year. The commissioner and 4125
the tax administrator of the municipal corporation, as applicable,4126
may require that such copies be transmitted electronically.4127

        (E) Amounts deducted and withheld shall be allowed as a 4128
credit against payment of the tax imposed by section 5747.02 of 4129
the Revised Code and shall be treated as taxes paid for purposes 4130
of section 5747.09 of the Revised Code. This division applies only 4131
to the person for whom the amount is deducted and withheld.4132

        (F) The failure of a lottery sales agent to deduct and 4133
withhold the required amount from a person's prize award does not 4134
relieve the person from liability for the tax imposed by section 4135
5747.02 of the Revised Code with respect to that income. 4136
Compliance with this section does not relieve a lottery sales 4137
agent or a person who has a prize award from compliance with 4138
relevant provisions of federal tax laws.4139

        (G) The commissioner and the tax administrator of the 4140
municipal corporation, as applicable, shall prescribe the form of 4141
the receipt and returns required by this section and the 4142
commissioner may promulgate any rules necessary to administer the 4143
section.4144

       (H) The requirements imposed under this section are in 4145
addition to the municipal income tax withholding requirements 4146
under section 718.031 of the Revised Code.4147

       Sec. 5747.50.  (A) As used in this section:4148

       (1) "County's proportionate share of the calendar year 2007 4149
LGF and LGRAF distributions" means the percentage computed for the 4150
county under division (B)(1)(a) of section 5747.501 of the Revised 4151
Code.4152

       (2) "County's proportionate share of the total amount of the 4153
local government fund additional revenue formula" means each 4154
county's proportionate share of the state's population as 4155
determined for and certified to the county for distributions to be 4156
made during the current calendar year under division (B)(2)(a) of 4157
section 5747.501 of the Revised Code. If prior to the first day of 4158
January of the current calendar year the federal government has 4159
issued a revision to the population figures reflected in the 4160
estimate produced pursuant to division (B)(2)(a) of section 4161
5747.501 of the Revised Code, such revised population figures 4162
shall be used for making the distributions during the current 4163
calendar year.4164

       (3) "2007 LGF and LGRAF county distribution base available in 4165
that month" means the lesser of the amounts described in division 4166
(A)(3)(a) and (b) of this section, provided that the amount shall 4167
not be less than zero:4168

       (a) The total amount available for distribution to counties 4169
from the local government fund during the current month.4170

       (b) The total amount distributed to counties from the local 4171
government fund and the local government revenue assistance fund 4172
to counties in calendar year 2007 less the total amount 4173
distributed to counties under division (B)(1) of this section 4174
during previous months of the current calendar year.4175

       (4) "Local government fund additional revenue distribution 4176
base available during that month" means the total amount available 4177
for distribution to counties during the month from the local 4178
government fund, less any amounts to be distributed in that month 4179
from the local government fund under division (B)(1) of this 4180
section, provided that the local government fund additional 4181
revenue distribution base available during that month shall not be 4182
less than zero.4183

       (5) "Total amount available for distribution to counties" 4184
means the total amount available for distribution from the local 4185
government fund during the current month less the total amount 4186
available for distribution to municipal corporations during the 4187
current month under division (C) of this section.4188

       (B) On or before the tenth day of each month, the tax 4189
commissioner shall provide for payment to each county an amount 4190
equal to the sum of:4191

       (1) The county's proportionate share of the calendar year 4192
2007 LGF and LGRAF distributions multiplied by the 2007 LGF and 4193
LGRAF county distribution base available in that month, provided 4194
that if the 2007 LGF and LGRAF county distribution base available 4195
in that month is zero, no payment shall be made under division 4196
(B)(1) of this section for the month or the remainder of the 4197
calendar year; and4198

       (2) The county's proportionate share of the total amount of 4199
the local government fund additional revenue formula multiplied by 4200
the local government fund additional revenue distribution base 4201
available during that month.4202

       Money received into the treasury of a county under this 4203
division shall be credited to the undivided local government fund 4204
in the treasury of the county on or before the fifteenth day of 4205
each month. On or before the twentieth day of each month, the 4206
county auditor shall issue warrants against all of the undivided 4207
local government fund in the county treasury in the respective 4208
amounts allowed as provided in section 5747.51 of the Revised 4209
Code, and the treasurer shall distribute and pay such sums to the 4210
subdivision therein.4211

       (C)(1) As used in division (C) of this section:4212

       (a) "Total amount available for distribution to 4213
municipalities during the current month" means the product 4214
obtained by multiplying the total amount available for 4215
distribution from the local government fund during the current 4216
month by the aggregate municipal share.4217

       (b) "Aggregate municipal share" means the quotient obtained 4218
by dividing the total amount distributed directly from the local 4219
government fund to municipal corporations during calendar year 4220
2007 by the total distributions from the local government fund and 4221
local government revenue assistance fund during calendar year 4222
2007.4223

       (2) On or before the tenth day of each month, the tax 4224
commissioner shall provide for payment from the local government 4225
fund to each municipal corporation an amount equal to the product 4226
derived by multiplying the municipal corporation's percentage of 4227
the total amount distributed to all such municipal corporations 4228
under this division during calendar year 2007 by the total amount 4229
available for distribution to municipal corporations during the 4230
current month. 4231

       (3) Payments received by a municipal corporation under this 4232
division shall be paid into its general fund and may be used for 4233
any lawful purpose.4234

       (4) The amount distributed to municipal corporations under 4235
this division during any calendar year shall not exceed the amount 4236
distributed directly from the local government fund to municipal 4237
corporations during calendar year 2007. If that maximum amount is 4238
reached during any month, distributions to municipal corporations 4239
in that month shall be as provided in divisions (C)(1) and (2) of 4240
this section, but no further distributions shall be made to 4241
municipal corporations under division (C) of this section during 4242
the remainder of the calendar year.4243

       (5) Upon being informed of a municipal corporation's 4244
dissolution, the tax commissioner shall cease providing for 4245
payments to that municipal corporation under division (C) of this 4246
section. The proportionate shares of the total amount available 4247
for distribution to each of the remaining municipal corporations 4248
under this division shall be increased on a pro rata basis.4249

       (D) Each municipal corporation which has in effect a tax 4250
imposed under Chapter 718. of the Revised Code shall, no later 4251
than the thirty-first day of August of each year, certify to the 4252
tax commissioner, on a form prescribed by the commissioner, the 4253
total amount of income taxestax revenue collected and refunded by 4254
such municipal corporation pursuant to such chapter during the 4255
preceding calendar year, arranged by the type of income from which 4256
the revenue was collected or the refund was issued. The municipal 4257
corporation shall also report the amount of income tax revenue 4258
collected and refunded on behalf of a joint economic development 4259
district or a joint economic development zone that levies an 4260
income tax administered by the municipal corporation and the 4261
amount of such revenue distributed to contracting parties during 4262
the preceding calendar year. The tax commissioner may withhold 4263
payment of local government fund moneys pursuant to division (C) 4264
of this section from any municipal corporation for failure to 4265
comply with this reporting requirement.4266

       Sec. 5751.07.  (A) Any person required to file returns under 4267
this chapter shall remit each tax payment, and, if required by the 4268
tax commissioner, file the tax return or the annual report, 4269
electronically. The commissioner may require taxpayers to use the 4270
Ohio business gateway as defined in section 718.051718.01 of the 4271
Revised Code to file returns and remit the tax, or may provide 4272
another means for taxpayers to file and remit the tax 4273
electronically.4274

       (B) A person required by this section to remit taxes or file 4275
returns electronically may apply to the tax commissioner, on the 4276
form prescribed by the commissioner, to be excused from that 4277
requirement. The commissioner may excuse a person from the 4278
requirements of this division for good cause.4279

       (C)(1) If a person required to remit taxes or file a return 4280
electronically under this section fails to do so, the commissioner 4281
may impose a penalty not to exceed the following:4282

       (a) For either of the first two tax periods the person so 4283
fails, the greater of twenty-five dollars or five per cent of the 4284
amount of the payment that was required to be remitted;4285

       (b) For the third and any subsequent tax periods the person 4286
so fails, the greater of fifty dollars or ten per cent of the 4287
amount of the payment that was required to be remitted.4288

       (2) The penalty imposed under division (C)(1) of this section 4289
is in addition to any other penalty imposed under this chapter and 4290
shall be considered as revenue arising from the tax imposed under 4291
this chapter. A penalty may be collected by assessment in the 4292
manner prescribed by section 5751.09 of the Revised Code. The tax 4293
commissioner may abate all or a portion of such a penalty.4294

       (D) The tax commissioner may adopt rules necessary to 4295
administer this section.4296

       Section 2.  That existing sections 709.023, 718.02, 718.03, 4297
718.04, 718.051, 718.07, 718.09, 718.10, 718.11, 718.121, 718.13, 4298
5703.059, 5703.57, 5717.011, 5717.03, 5739.12, 5739.124, 5741.122, 4299
5747.063, 5747.064, 5747.50, and 5751.07 and sections 718.01, 4300
718.011, 718.041, 718.05, 718.06, 718.08, 718.12, and 718.14 of 4301
the Revised Code are hereby repealed.4302

       Section 3.  That the version of section 5703.02 of the 4303
Revised Code that is scheduled to take effect January 1, 2015, be 4304
amended to read as follows:4305

       Sec. 5703.02.  There is hereby created the board of tax 4306
appeals, which shall exercise the following powers and perform the 4307
following duties:4308

       (A) Exercise the authority provided by law to hear and 4309
determine all appeals of questions of law and fact arising under 4310
the tax laws of this state in appeals from decisions, orders, 4311
determinations, or actions of any tax administrative agency 4312
established by the law of this state, including but not limited to 4313
appeals from:4314

       (1) Actions of county budget commissions;4315

       (2) Decisions of county boards of revision;4316

       (3) Actions of any assessing officer or other public official 4317
under the tax laws of this state;4318

       (4) Final determinations by the tax commissioner of any 4319
preliminary, amended, or final tax assessments, reassessments, 4320
valuations, determinations, findings, computations, or orders made 4321
by the tax commissioner;4322

       (5) Adoption and promulgation of rules of the tax 4323
commissioner.4324

       (B) Appoint a secretary of the board of tax appeals, who 4325
shall serve in the unclassified civil service at the pleasure of 4326
the board, and any other employees as are necessary in the 4327
exercise of the powers and the performance of the duties and 4328
functions that the board is by law authorized and required to 4329
exercise, and prescribe the duties of all employees, and to fix 4330
their compensation as provided by law;4331

       (C) Maintain a journal, which shall be open to public 4332
inspection and in which the secretary shall keep a record of all 4333
of the proceedings and the vote of each of its members upon every 4334
action taken by it;4335

       (D) Adopt and promulgate, in the manner provided by section 4336
5703.14 of the Revised Code, and enforce all rules relating to the 4337
procedure of the board in hearing appeals it has the authority or 4338
duty to hear, and to the procedure of officers or employees whom 4339
the board may appoint; provided that section 5703.13 of the 4340
Revised Code shall apply to and govern the procedure of the board. 4341
Such rules shall include, but need not be limited to, the 4342
following:4343

       (1) Rules governing the creation and implementation of a 4344
mediation program, including procedures for requesting, requiring 4345
participation in, objecting to, and conducting a mediation;4346

       (2) Rules requiring the tax commissioner, county boards of 4347
revision, and municipallocal boards of appealtax review created 4348
under section 718.11 of the Revised Code to electronically file 4349
any transcript required to be filed with the board of tax appeals, 4350
and instructions and procedures for the electronic filing of such 4351
transcripts.4352

       (3) Rules establishing procedures to control and manage 4353
appeals filed with the board. The procedures shall include, but 4354
not be limited to, the establishment of a case management schedule 4355
that shall include expected dates related to discovery deadlines, 4356
disclosure of evidence, pre-hearing motions, and the hearing, and 4357
other case management issues considered appropriate.4358

       Section 4.  That the existing version of section 5703.02 of 4359
the Revised Code that is scheduled to take effect January 1, 2015, 4360
is hereby repealed.4361

       Section 5.  Sections 3 and 4 of this act take effect on 4362
January 1, 2015.4363

       Section 6.  This act applies to municipal taxable years 4364
beginning on or after January 1, 2015. For municipal taxable years 4365
beginning before January 1, 2015, tax administrators may continue 4366
to administer, audit, and enforce the income tax of a municipal 4367
corporation under Chapter 718. and ordinances and resolutions of 4368
the municipal corporation as that chapter and those ordinances and 4369
resolutions existed before January 1, 2015.4370

       Section 7.  (A) There is hereby created the Municipal Income 4371
Tax Net Operating Loss Review Committee for the purpose of 4372
evaluating and quantifying the potential fiscal impact to 4373
municipal corporations levying an income tax requiring such 4374
municipal corporations to allow taxpayers to carry forward net 4375
operating losses for five years. The Committee is a public body 4376
for the purposes of section 121.22 of the Revised Code.4377

       (B) The Committee shall be composed of the following members:4378

       (1) Two members of the House of Representatives who are not 4379
of the same political party, appointed by the Speaker of the House 4380
of Representatives;4381

       (2) Two members of the Senate who are not of the same 4382
political party, appointed by the President of the Senate;4383

       (3) Three members representing municipal income taxpayers, 4384
appointed by the Speaker of the House of Representatives;4385

       (4) Three members representing municipal corporations that 4386
levy an income tax in calendar year 2015, appointed by the 4387
President of the Senate;4388

       (5) One member appointed by the Governor, who shall serve as 4389
the chairperson of the Committee.4390

       The appointing authorities shall appoint members of the 4391
Committee not later than March 1, 2014. An appointed member shall 4392
serve until the member resigns or is removed by the member's 4393
appointing authority. Vacancies shall be filled in the same manner 4394
as original appointments. A vacancy on the committee does not 4395
impair the right of the other members to exercise all the 4396
functions of the Committee.4397

       The Committee shall meet for the first time on or before 4398
March 1, 2014. Thereafter, the Committee shall meet at the call of 4399
the chairperson. The presence of a majority of the members of the 4400
Committee constitutes a quorum for the conduct of business of the 4401
Committee. The concurrence of at least a majority of the members 4402
of the Committee is necessary to approve the report issued by the 4403
Committee under division (E) of this section. Members of the 4404
Committee shall not be compensated or reimbursed for members' 4405
expenses.4406

       (C) On or before July 1, 2014, the Committee shall prescribe 4407
a method that municipal corporations shall use to estimate the 4408
difference between the municipal corporation's actual or projected 4409
municipal income tax revenue in 2012, 2013, 2014, 2015, 2016, 4410
2017, and 2018 and the actual or projected municipal income tax 4411
revenue that would have resulted in each of those years if the 4412
municipal corporation allowed net operating loss to be carried 4413
forward for five years for losses incurred in 2011, 2012, and 4414
2013.4415

       (D) On or before December 31, 2014, each municipal 4416
corporation that levies an income tax in 2011, 2012, or 2013 shall 4417
report to the Municipal Income Tax Net Operating Loss Review 4418
Committee the difference between the municipal corporation's 4419
actual or projected municipal income tax revenue in 2012, 2013, 4420
2014, 2015, 2016, 2017, and 2018 and the actual or projected 4421
municipal income tax revenue that would have resulted in each of 4422
those years if the municipal corporation allowed net operating 4423
loss to be carried forward for five years for losses incurred in 4424
2011, 2012, and 2013, as estimated by the method prescribed by the 4425
Committee under division (C) of this section.4426

       (E) If the Municipal Income Tax Net Operating Loss Review 4427
Committee receives reports from a representative sample, then the 4428
Committee shall review the information reported by municipal 4429
corporations under division (D) of this section and calculate the 4430
total of the revenue effects reported by such municipal 4431
corporations. On or before May 1, 2015, the Committee shall issue 4432
a written report to the Speaker and Minority Leader of the House 4433
of Representatives and the President and Minority Leader of the 4434
Senate reporting the Committee's findings and estimated revenue 4435
impact of requiring municipal corporations levying an income tax 4436
to allow net operating loss to be carried forward for five years. 4437
The report shall contain recommendations to address revenue 4438
shortfalls, which may include, but which shall not be limited to, 4439
the use of supplemental funds from the Local Government Fund to 4440
mitigate those shortfalls.4441

       (F) Nothing in this section delays or otherwise affects the 4442
taxable years to which division (E)(8) of section 718.01 of the 4443
Revised Code, as enacted by this act, apply as prescribed in that 4444
division.4445

       (G) The Municipal Income Tax Net Operating Loss Review 4446
Committee shall cease to exist on May 1, 2015.4447

       (H) As used in this section, "representative sample" includes 4448
the cities of Cleveland and Columbus, five cities or villages with 4449
a higher ratio of business taxpayers to resident individual 4450
taxpayers relative to the state average, and five cities or 4451
villages with a higher ratio of resident individual taxpayers to 4452
business taxpayers relative to the state average.4453