The online versions of legislation provided on this website are not official. Enrolled bills are the final version passed by the Ohio General Assembly and presented to the Governor for signature. The official version of acts signed by the Governor are available from the Secretary of State's Office in the Continental Plaza, 180 East Broad St., Columbus.
|
Am. S. B. No. 28 As Reported by the House Ways and Means CommitteeAs Reported by the House Ways and Means Committee
130th General Assembly | Regular Session | 2013-2014 |
| |
Cosponsors:
Senators Hite, Schaffer, Tavares, Beagle, Coley, Faber, Hughes, Oelslager, Peterson, Sawyer, Seitz, Uecker
Representatives Boose, Letson, Barnes, McClain, Patmon, Rogers, Sprague
A BILL
To amend sections 5701.11 and 5751.01 of the Revised
Code to expressly incorporate changes in the
Internal Revenue Code since December 20, 2012,
into Ohio law, to allow a distribution center to
qualify for the commercial activity tax exclusion
for receipts from sales to qualified distribution
centers if it does not currently meet the
exclusion requirements but expects to meet those
requirements within three years, and to declare an
emergency.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 5701.11 and 5751.01 of the Revised
Code be amended to read as follows:
Sec. 5701.11. The effective date to which this section
refers is the effective date of this section as amended by H.B.
472 S.B. 28 of the 129th 130th general assembly.
(A)(1) Except as provided under division (A)(2) or (B) of
this section, any reference in Title LVII of the Revised Code to
the Internal Revenue Code, to the Internal Revenue Code "as
amended," to other laws of the United States, or to other laws of
the United States, "as amended," means the Internal Revenue Code
or other laws of the United States as they exist on the effective
date.
(2) This section does not apply to any reference in Title
LVII of the Revised Code to the Internal Revenue Code as of a date
certain specifying the day, month, and year, or to other laws of
the United States as of a date certain specifying the day, month,
and year.
(B)(1) For purposes of applying section 5733.04, 5745.01, or
5747.01 of the Revised Code to a taxpayer's taxable year ending
after March 7, 2011 December 20, 2012, and before the effective
date, a taxpayer may irrevocably elect to incorporate the
provisions of the Internal Revenue Code or other laws of the
United States that are in effect for federal income tax purposes
for that taxable year if those provisions differ from the
provisions that, under division (A) of this section, would
otherwise apply. The filing by the taxpayer for that taxable year
of a report or return that incorporates the provisions of the
Internal Revenue Code or other laws of the United States
applicable for federal income tax purposes for that taxable year,
and that does not include any adjustments to reverse the effects
of any differences between those provisions and the provisions
that would otherwise apply, constitutes the making of an
irrevocable election under this division for that taxable year.
(2) Elections under prior versions of division (B)(1) of this
section remain in effect for the taxable years to which they
apply.
Sec. 5751.01. As used in this chapter:
(A) "Person" means, but is not limited to, individuals,
combinations of individuals of any form, receivers, assignees,
trustees in bankruptcy, firms, companies, joint-stock companies,
business trusts, estates, partnerships, limited liability
partnerships, limited liability companies, associations, joint
ventures, clubs, societies, for-profit corporations, S
corporations, qualified subchapter S subsidiaries, qualified
subchapter S trusts, trusts, entities that are disregarded for
federal income tax purposes, and any other entities.
(B) "Consolidated elected taxpayer" means a group of two or
more persons treated as a single taxpayer for purposes of this
chapter as the result of an election made under section 5751.011
of the Revised Code.
(C) "Combined taxpayer" means a group of two or more persons
treated as a single taxpayer for purposes of this chapter under
section 5751.012 of the Revised Code.
(D) "Taxpayer" means any person, or any group of persons in
the case of a consolidated elected taxpayer or combined taxpayer
treated as one taxpayer, required to register or pay tax under
this chapter. "Taxpayer" does not include excluded persons.
(E) "Excluded person" means any of the following:
(1) Any person with not more than one hundred fifty thousand
dollars of taxable gross receipts during the calendar year.
Division (E)(1) of this section does not apply to a person that is
a member of a consolidated elected taxpayer;
(2) A public utility that paid the excise tax imposed by
section 5727.24 or 5727.30 of the Revised Code based on one or
more measurement periods that include the entire tax period under
this chapter, except that a public utility that is a combined
company is a taxpayer with regard to the following gross receipts:
(a) Taxable gross receipts directly attributed to a public
utility activity, but not directly attributed to an activity that
is subject to the excise tax imposed by section 5727.24 or 5727.30
of the Revised Code;
(b) Taxable gross receipts that cannot be directly attributed
to any activity, multiplied by a fraction whose numerator is the
taxable gross receipts described in division (E)(2)(a) of this
section and whose denominator is the total taxable gross receipts
that can be directly attributed to any activity;
(c) Except for any differences resulting from the use of an
accrual basis method of accounting for purposes of determining
gross receipts under this chapter and the use of the cash basis
method of accounting for purposes of determining gross receipts
under section 5727.24 of the Revised Code, the gross receipts
directly attributed to the activity of a natural gas company shall
be determined in a manner consistent with division (D) of section
5727.03 of the Revised Code.
As used in division (E)(2) of this section, "combined
company" and "public utility" have the same meanings as in section
5727.01 of the Revised Code.
(3) A financial institution, as defined in section 5726.01 of
the Revised Code, that paid the tax imposed by section 5726.02 of
the Revised Code based on one or more taxable years that include
the entire tax period under this chapter;
(4) A person directly or indirectly owned by one or more
financial institutions, as defined in section 5726.01 of the
Revised Code, that paid the tax imposed by section 5726.02 of the
Revised Code based on one or more taxable years that include the
entire tax period under this chapter.
For the purposes of division (E)(4) of this section, a person
owns another person under the following circumstances:
(a) In the case of corporations issuing capital stock, one
corporation owns another corporation if it owns fifty per cent or
more of the other corporation's capital stock with current voting
rights;
(b) In the case of a limited liability company, one person
owns the company if that person's membership interest, as defined
in section 1705.01 of the Revised Code, is fifty per cent or more
of the combined membership interests of all persons owning such
interests in the company;
(c) In the case of a partnership, trust, or other
unincorporated business organization other than a limited
liability company, one person owns the organization if, under the
articles of organization or other instrument governing the affairs
of the organization, that person has a beneficial interest in the
organization's profits, surpluses, losses, or distributions of
fifty per cent or more of the combined beneficial interests of all
persons having such an interest in the organization.
(5) A domestic insurance company or foreign insurance
company, as defined in section 5725.01 of the Revised Code, that
paid the insurance company premiums tax imposed by section 5725.18
or Chapter 5729. of the Revised Code, or an unauthorized insurance
company whose gross premiums are subject to tax under section
3905.36 of the Revised Code based on one or more measurement
periods that include the entire tax period under this chapter;
(6) A person that solely facilitates or services one or more
securitizations of phase-in-recovery property pursuant to a final
financing order as those terms are defined in section 4928.23 of
the Revised Code. For purposes of this division, "securitization"
means transferring one or more assets to one or more persons and
then issuing securities backed by the right to receive payment
from the asset or assets so transferred.
(7) Except as otherwise provided in this division, a
pre-income tax trust as defined in division (FF)(4) of section
5747.01 of the Revised Code and any pass-through entity of which
such pre-income tax trust owns or controls, directly, indirectly,
or constructively through related interests, more than five per
cent of the ownership or equity interests. If the pre-income tax
trust has made a qualifying pre-income tax trust election under
division (FF)(3) of section 5747.01 of the Revised Code, then the
trust and the pass-through entities of which it owns or controls,
directly, indirectly, or constructively through related interests,
more than five per cent of the ownership or equity interests,
shall not be excluded persons for purposes of the tax imposed
under section 5751.02 of the Revised Code.
(8) Nonprofit organizations or the state and its agencies,
instrumentalities, or political subdivisions.
(F) Except as otherwise provided in divisions (F)(2), (3),
and (4) of this section, "gross receipts" means the total amount
realized by a person, without deduction for the cost of goods sold
or other expenses incurred, that contributes to the production of
gross income of the person, including the fair market value of any
property and any services received, and any debt transferred or
forgiven as consideration.
(1) The following are examples of gross receipts:
(a) Amounts realized from the sale, exchange, or other
disposition of the taxpayer's property to or with another;
(b) Amounts realized from the taxpayer's performance of
services for another;
(c) Amounts realized from another's use or possession of the
taxpayer's property or capital;
(d) Any combination of the foregoing amounts.
(2) "Gross receipts" excludes the following amounts:
(a) Interest income except interest on credit sales;
(b) Dividends and distributions from corporations, and
distributive or proportionate shares of receipts and income from a
pass-through entity as defined under section 5733.04 of the
Revised Code;
(c) Receipts from the sale, exchange, or other disposition of
an asset described in section 1221 or 1231 of the Internal Revenue
Code, without regard to the length of time the person held the
asset. Notwithstanding section 1221 of the Internal Revenue Code,
receipts from hedging transactions also are excluded to the extent
the transactions are entered into primarily to protect a financial
position, such as managing the risk of exposure to (i) foreign
currency fluctuations that affect assets, liabilities, profits,
losses, equity, or investments in foreign operations; (ii)
interest rate fluctuations; or (iii) commodity price fluctuations.
As used in division (F)(2)(c) of this section, "hedging
transaction" has the same meaning as used in section 1221 of the
Internal Revenue Code and also includes transactions accorded
hedge accounting treatment under statement of financial accounting
standards number 133 of the financial accounting standards board.
For the purposes of division (F)(2)(c) of this section, the actual
transfer of title of real or tangible personal property to another
entity is not a hedging transaction.
(d) Proceeds received attributable to the repayment,
maturity, or redemption of the principal of a loan, bond, mutual
fund, certificate of deposit, or marketable instrument;
(e) The principal amount received under a repurchase
agreement or on account of any transaction properly characterized
as a loan to the person;
(f) Contributions received by a trust, plan, or other
arrangement, any of which is described in section 501(a) of the
Internal Revenue Code, or to which Title 26, Subtitle A, Chapter
1, Subchapter (D) of the Internal Revenue Code applies;
(g) Compensation, whether current or deferred, and whether in
cash or in kind, received or to be received by an employee, former
employee, or the employee's legal successor for services rendered
to or for an employer, including reimbursements received by or for
an individual for medical or education expenses, health insurance
premiums, or employee expenses, or on account of a dependent care
spending account, legal services plan, any cafeteria plan
described in section 125 of the Internal Revenue Code, or any
similar employee reimbursement;
(h) Proceeds received from the issuance of the taxpayer's own
stock, options, warrants, puts, or calls, or from the sale of the
taxpayer's treasury stock;
(i) Proceeds received on the account of payments from
insurance policies, except those proceeds received for the loss of
business revenue;
(j) Gifts or charitable contributions received; membership
dues received by trade, professional, homeowners', or condominium
associations; and payments received for educational courses,
meetings, meals, or similar payments to a trade, professional, or
other similar association; and fundraising receipts received by
any person when any excess receipts are donated or used
exclusively for charitable purposes;
(k) Damages received as the result of litigation in excess of
amounts that, if received without litigation, would be gross
receipts;
(l) Property, money, and other amounts received or acquired
by an agent on behalf of another in excess of the agent's
commission, fee, or other remuneration;
(m) Tax refunds, other tax benefit recoveries, and
reimbursements for the tax imposed under this chapter made by
entities that are part of the same combined taxpayer or
consolidated elected taxpayer group, and reimbursements made by
entities that are not members of a combined taxpayer or
consolidated elected taxpayer group that are required to be made
for economic parity among multiple owners of an entity whose tax
obligation under this chapter is required to be reported and paid
entirely by one owner, pursuant to the requirements of sections
5751.011 and 5751.012 of the Revised Code;
(o) Contributions to capital;
(p) Sales or use taxes collected as a vendor or an
out-of-state seller on behalf of the taxing jurisdiction from a
consumer or other taxes the taxpayer is required by law to collect
directly from a purchaser and remit to a local, state, or federal
tax authority;
(q) In the case of receipts from the sale of cigarettes or
tobacco products by a wholesale dealer, retail dealer,
distributor, manufacturer, or seller, all as defined in section
5743.01 of the Revised Code, an amount equal to the federal and
state excise taxes paid by any person on or for such cigarettes or
tobacco products under subtitle E of the Internal Revenue Code or
Chapter 5743. of the Revised Code;
(r) In the case of receipts from the sale of motor fuel by a
licensed motor fuel dealer, licensed retail dealer, or licensed
permissive motor fuel dealer, all as defined in section 5735.01 of
the Revised Code, an amount equal to federal and state excise
taxes paid by any person on such motor fuel under section 4081 of
the Internal Revenue Code or Chapter 5735. of the Revised Code;
(s) In the case of receipts from the sale of beer or
intoxicating liquor, as defined in section 4301.01 of the Revised
Code, by a person holding a permit issued under Chapter 4301. or
4303. of the Revised Code, an amount equal to federal and state
excise taxes paid by any person on or for such beer or
intoxicating liquor under subtitle E of the Internal Revenue Code
or Chapter 4301. or 4305. of the Revised Code;
(t) Receipts realized by a new motor vehicle dealer or used
motor vehicle dealer, as defined in section 4517.01 of the Revised
Code, from the sale or other transfer of a motor vehicle, as
defined in that section, to another motor vehicle dealer for the
purpose of resale by the transferee motor vehicle dealer, but only
if the sale or other transfer was based upon the transferee's need
to meet a specific customer's preference for a motor vehicle;
(u) Receipts from a financial institution described in
division (E)(3) of this section for services provided to the
financial institution in connection with the issuance, processing,
servicing, and management of loans or credit accounts, if such
financial institution and the recipient of such receipts have at
least fifty per cent of their ownership interests owned or
controlled, directly or constructively through related interests,
by common owners;
(v) Receipts realized from administering anti-neoplastic
drugs and other cancer chemotherapy, biologicals, therapeutic
agents, and supportive drugs in a physician's office to patients
with cancer;
(w) Funds received or used by a mortgage broker that is not a
dealer in intangibles, other than fees or other consideration,
pursuant to a table-funding mortgage loan or warehouse-lending
mortgage loan. Terms used in division (F)(2)(w) of this section
have the same meanings as in section 1322.01 of the Revised Code,
except "mortgage broker" means a person assisting a buyer in
obtaining a mortgage loan for a fee or other consideration paid by
the buyer or a lender, or a person engaged in table-funding or
warehouse-lending mortgage loans that are first lien mortgage
loans.
(x) Property, money, and other amounts received by a
professional employer organization, as defined in section 4125.01
of the Revised Code, from a client employer, as defined in that
section, in excess of the administrative fee charged by the
professional employer organization to the client employer;
(y) In the case of amounts retained as commissions by a
permit holder under Chapter 3769. of the Revised Code, an amount
equal to the amounts specified under that chapter that must be
paid to or collected by the tax commissioner as a tax and the
amounts specified under that chapter to be used as purse money;
(z) Qualifying distribution center receipts.
(i) For purposes of division (F)(2)(z) of this section:
(I) "Qualifying distribution center receipts" means receipts
of a supplier from qualified property that is delivered to a
qualified distribution center, multiplied by a quantity that
equals one minus the Ohio delivery percentage. If the qualified
distribution center is a refining facility, "supplier" includes
all dealers, brokers, processors, sellers, vendors, cosigners, and
distributors of qualified property.
(II) "Qualified property" means tangible personal property
delivered to a qualified distribution center that is shipped to
that qualified distribution center solely for further shipping by
the qualified distribution center to another location in this
state or elsewhere or, in the case of gold, silver, platinum, or
palladium delivered to a refining facility solely for refining to
a grade and fineness acceptable for delivery to a registered
commodities exchange. "Further shipping" includes storing and
repackaging property into smaller or larger bundles, so long as
the property is not subject to further manufacturing or
processing. "Refining" is limited to extracting impurities from
gold, silver, platinum, or palladium through smelting or some
other process at a refining facility.
(III) "Qualified distribution center" means a warehouse, a
facility similar to a warehouse, or a refining facility in this
state that, for the qualifying year, is operated by a person that
is not part of a combined taxpayer group and that has a qualifying
certificate. All warehouses or facilities similar to warehouses
that are operated by persons in the same taxpayer group and that
are located within one mile of each other shall be treated as one
qualified distribution center. All refining facilities that are
operated by persons in the same taxpayer group and that are
located in the same or adjacent counties may be treated as one
qualified distribution center.
(IV) "Qualifying year" means the calendar year to which the
qualifying certificate applies.
(V) "Qualifying period" means the period of the first day of
July of the second year preceding the qualifying year through the
thirtieth day of June of the year preceding the qualifying year.
(VI) "Qualifying certificate" means the certificate issued by
the tax commissioner after the operator of a distribution center
files an annual application with the commissioner. The application
and annual fee shall be filed and paid for each qualified
distribution center on or before the first day of September before
the qualifying year or within forty-five days after the
distribution center opens, whichever is later.
The applicant must substantiate to the commissioner's
satisfaction that, for the qualifying period, all persons
operating the distribution center have more than fifty per cent of
the cost of the qualified property shipped to a location such that
it would be sitused outside this state under the provisions of
division (E) of section 5751.033 of the Revised Code. The
applicant must also substantiate that the distribution center
cumulatively had costs from its suppliers equal to or exceeding
five hundred million dollars during the qualifying period. (For
purposes of division (F)(2)(z)(i)(VI) of this section, "supplier"
excludes any person that is part of the consolidated elected
taxpayer group, if applicable, of the operator of the qualified
distribution center.) The commissioner may require the applicant
to have an independent certified public accountant certify that
the calculation of the minimum thresholds required for a qualified
distribution center by the operator of a distribution center has
been made in accordance with generally accepted accounting
principles. The commissioner shall issue or deny the issuance of a
certificate within sixty days after the receipt of the
application. A denial is subject to appeal under section 5717.02
of the Revised Code. If the operator files a timely appeal under
section 5717.02 of the Revised Code, the operator shall be granted
a qualifying certificate, provided that the operator is liable for
any tax, interest, or penalty upon amounts claimed as qualifying
distribution center receipts, other than those receipts exempt
under division (C)(1) of section 5751.011 of the Revised Code,
that would have otherwise not been owed by its suppliers if the
qualifying certificate was valid.
(VII) "Ohio delivery percentage" means the proportion of the
total property delivered to a destination inside Ohio from the
qualified distribution center during the qualifying period
compared with total deliveries from such distribution center
everywhere during the qualifying period.
(VIII) "Refining facility" means one or more buildings
located in a county in the Appalachian region of this state as
defined by section 107.21 of the Revised Code and utilized for
refining or smelting gold, silver, platinum, or palladium to a
grade and fineness acceptable for delivery to a registered
commodities exchange.
(IX) "Registered commodities exchange" means a board of
trade, such as New York mercantile exchange, inc. or commodity
exchange, inc., designated as a contract market by the commodity
futures trading commission under the "Commodity Exchange Act," 7
U.S.C. 1 et seq., as amended.
(ii)(I) If the distribution center is new and was not open
for the entire qualifying period, the operator of the distribution
center may request that the commissioner grant a qualifying
certificate. If the certificate is granted and it is later
determined that more than fifty per cent of the qualified property
during that year was not shipped to a location such that it would
be sitused outside of this state under the provisions of division
(E) of section 5751.033 of the Revised Code or if it is later
determined that the person that operates the distribution center
had average monthly costs from its suppliers of less than forty
million dollars during that year, then the operator of the
distribution center shall be liable for any tax, interest, or
penalty upon amounts claimed as qualifying distribution center
receipts, other than those receipts exempt under division (C)(1)
of section 5751.011 of the Revised Code, that would have not
otherwise been owed by its suppliers during the qualifying year if
the qualifying certificate was valid pay a penalty for that year
equal to five hundred thousand dollars. (For purposes of division
(F)(2)(z)(ii) of this section, "supplier" excludes any person that
is part of the consolidated elected taxpayer group, if applicable,
of the operator of the qualified distribution center.)
(II) The commissioner may grant a qualifying certificate to a
distribution center that does not qualify as a qualified
distribution center for an entire qualifying period if the
operator of the distribution center demonstrates that the business
operations of the distribution center have changed or will change
such that the distribution center will qualify as a qualified
distribution center within thirty-six months after the date the
operator first applies for a certificate. If, at the end of that
thirty-six-month period, the business operations of the
distribution center have not changed such that the distribution
center qualifies as a qualified distribution center, the operator
of the distribution center shall pay a penalty equal to five
hundred thousand dollars for each year that the distribution
center received a certificate but did not qualify as a qualified
distribution center. For each year the distribution center
receives a certificate under division (F)(2)(z)(ii)(II) of this
section, the distribution center shall pay all applicable fees
required under division (F)(2)(z) of this section and shall submit
an updated business plan showing the progress the distribution
center made toward qualifying as a qualified distribution center
during the preceding year.
(III) An operator may appeal the imposition of a penalty
imposed under division (F)(2)(z)(ii)(I) or (II) of this section as
provided in section 5717.02 of the Revised Code.
(iii) When filing an application for a qualifying certificate
under division (F)(2)(z)(i)(VI) of this section, the operator of a
qualified distribution center also shall provide documentation, as
the commissioner requires, for the commissioner to ascertain the
Ohio delivery percentage. The commissioner, upon issuing the
qualifying certificate, also shall certify the Ohio delivery
percentage. The operator of the qualified distribution center may
appeal the commissioner's certification of the Ohio delivery
percentage in the same manner as an appeal is taken from the
denial of a qualifying certificate under division (F)(2)(z)(i)(VI)
of this section.
Within thirty days after all appeals have been exhausted, the
operator of the qualified distribution center shall notify provide
the commissioner with a list of all affected suppliers of
qualified property. The commissioner shall notify all such
suppliers that such the suppliers are required to file, within
sixty days after receiving the notice from the operator of the
qualified distribution center, amended reports for the impacted
affected calendar quarter or quarters or calendar year, whichever
the case may be. Any additional tax liability or tax overpayment
shall be subject to interest but shall not be subject to the
imposition of any penalty so long as the amended returns are
timely filed. The supplier of tangible personal property delivered
to the qualified distribution center shall include in its report
of taxable gross receipts the receipts from the total sales of
property delivered to the qualified distribution center for the
calendar quarter or calendar year, whichever the case may be,
multiplied by the Ohio delivery percentage for the qualifying
year. Nothing in division (F)(2)(z)(iii) of this section shall be
construed as imposing liability on the operator of a qualified
distribution center for the tax imposed by this chapter arising
from any change to the Ohio delivery percentage.
(iv)(I) In the case where the distribution center is new and
not open for the entire qualifying period, the operator shall make
a good faith estimate of an Ohio delivery percentage for use by
suppliers in their reports of taxable gross receipts for the
remainder of the qualifying period. The operator of the facility
shall disclose to the suppliers that such Ohio delivery percentage
is an estimate and is subject to recalculation. By the due date of
the next application for a qualifying certificate, the operator
shall determine the actual Ohio delivery percentage for the
estimated qualifying period and proceed as provided in division
(F)(2)(z)(iii) of this section with respect to the calculation and
recalculation of the Ohio delivery percentage. The supplier is
required to file, within sixty days after receiving notice from
the operator of the qualified distribution center, amended reports
for the impacted calendar quarter or quarters or calendar year,
whichever the case may be. Any additional tax liability or tax
overpayment shall be subject to interest but shall not be subject
to the imposition of any penalty so long as the amended returns
are timely filed.
(II) The operator of a distribution center that receives a
qualifying certificate under division (F)(2)(ii)(II) of this
section shall make a good faith estimate of the Ohio delivery
percentage that the operator estimates will apply to the
distribution center at the end of the thirty-six-month period
after the operator first applied for a qualifying certificate
under that division. The result of the estimate shall be
multiplied by a factor of one and seventy-five one-hundredths. The
product of that calculation shall be the Ohio delivery percentage
used by suppliers in their reports of taxable gross receipts for
each qualifying year that the distribution center receives a
qualifying certificate under division (F)(2)(ii)(II) of this
section, except that, if the product is less than five per cent,
the Ohio delivery percentage used shall be five per cent and that,
if the product exceeds forty-nine per cent, the Ohio delivery
percentage used shall be forty-nine per cent.
(v) Qualifying certificates and Ohio delivery percentages
issued by the commissioner shall be open to public inspection and
shall be timely published by the commissioner. A supplier relying
in good faith on a certificate issued under this division shall
not be subject to tax on the qualifying distribution center
receipts under division (F)(2)(z) of this section. A person
receiving a qualifying certificate is responsible liable for
paying the tax, interest, and penalty upon amounts claimed as
qualifying distribution center receipts that would not otherwise
have been owed by the supplier if the qualifying certificate were
available when it is later determined that the qualifying
certificate a penalty equal to five hundred thousand dollars for
each year the person received a certificate that should not have
been issued because the statutory requirements were in fact not
met.
(vi) The annual fee for a qualifying certificate shall be one
hundred thousand dollars for each qualified distribution center.
If a qualifying certificate is not issued, the annual fee is
subject to refund after the exhaustion of all appeals provided for
in division (F)(2)(z)(i)(VI) of this section. The fee imposed
under this division may be assessed in the same manner as the tax
imposed under this chapter. The first one hundred thousand dollars
of the annual application fees collected each calendar year shall
be credited to the revenue enhancement fund. The remainder of the
annual application fees collected shall be distributed in the same
manner required under section 5751.20 of the Revised Code.
(vii) The tax commissioner may require that adequate security
be posted by the operator of the distribution center on appeal
when the commissioner disagrees that the applicant has met the
minimum thresholds for a qualified distribution center as set
forth in divisions (F)(2)(z)(i)(VI) and (F)(2)(z)(ii) of this
section.
(aa) Receipts of an employer from payroll deductions relating
to the reimbursement of the employer for advancing moneys to an
unrelated third party on an employee's behalf;
(bb) Cash discounts allowed and taken;
(cc) Returns and allowances;
(dd) Bad debts from receipts on the basis of which the tax
imposed by this chapter was paid in a prior quarterly tax payment
period. For the purpose of this division, "bad debts" means any
debts that have become worthless or uncollectible between the
preceding and current quarterly tax payment periods, have been
uncollected for at least six months, and that may be claimed as a
deduction under section 166 of the Internal Revenue Code and the
regulations adopted under that section, or that could be claimed
as such if the taxpayer kept its accounts on the accrual basis.
"Bad debts" does not include repossessed property, uncollectible
amounts on property that remains in the possession of the taxpayer
until the full purchase price is paid, or expenses in attempting
to collect any account receivable or for any portion of the debt
recovered;
(ee) Any amount realized from the sale of an account
receivable to the extent the receipts from the underlying
transaction giving rise to the account receivable were included in
the gross receipts of the taxpayer;
(ff) Any receipts directly attributed to providing public
services pursuant to sections 126.60 to 126.605 of the Revised
Code, or any receipts directly attributed to a transfer agreement
or to the enterprise transferred under that agreement under
section 4313.02 of the Revised Code.
(gg)(i) As used in this division:
(I) "Qualified uranium receipts" means receipts from the
sale, exchange, lease, loan, production, processing, or other
disposition of uranium within a uranium enrichment zone certified
by the tax commissioner under division (F)(2)(gg)(ii) of this
section. "Qualified uranium receipts" does not include any
receipts with a situs in this state outside a uranium enrichment
zone certified by the tax commissioner under division
(F)(2)(gg)(ii) of this section.
(II) "Uranium enrichment zone" means all real property that
is part of a uranium enrichment facility licensed by the United
States nuclear regulatory commission and that was or is owned or
controlled by the United States department of energy or its
successor.
(ii) Any person that owns, leases, or operates real or
tangible personal property constituting or located within a
uranium enrichment zone may apply to the tax commissioner to have
the uranium enrichment zone certified for the purpose of excluding
qualified uranium receipts under division (F)(2)(gg) of this
section. The application shall include such information that the
tax commissioner prescribes. Within sixty days after receiving the
application, the tax commissioner shall certify the zone for that
purpose if the commissioner determines that the property qualifies
as a uranium enrichment zone as defined in division (F)(2)(gg) of
this section, or, if the tax commissioner determines that the
property does not qualify, the commissioner shall deny the
application or request additional information from the applicant.
If the tax commissioner denies an application, the commissioner
shall state the reasons for the denial. The applicant may appeal
the denial of an application to the board of tax appeals pursuant
to section 5717.02 of the Revised Code. If the applicant files a
timely appeal, the tax commissioner shall conditionally certify
the applicant's property. The conditional certification shall
expire when all of the applicant's appeals are exhausted. Until
final resolution of the appeal, the applicant shall retain the
applicant's records in accordance with section 5751.12 of the
Revised Code, notwithstanding any time limit on the preservation
of records under that section.
(hh) Amounts realized by licensed motor fuel dealers or
licensed permissive motor fuel dealers from the exchange of
petroleum products, including motor fuel, between such dealers,
provided that delivery of the petroleum products occurs at a
refinery, terminal, pipeline, or marine vessel and that the
exchanging dealers agree neither dealer shall require monetary
compensation from the other for the value of the exchanged
petroleum products other than such compensation for differences in
product location or grade. Division (F)(2)(hh) of this section
does not apply to amounts realized as a result of differences in
location or grade of exchanged petroleum products or from
handling, lubricity, dye, or other additive injections fees,
pipeline security fees, or similar fees. As used in this division,
"motor fuel," "licensed motor fuel dealer," "licensed permissive
motor fuel dealer," and "terminal" have the same meanings as in
section 5735.01 of the Revised Code.
(ii) In the case of amounts collected by a licensed casino
operator from casino gaming, amounts in excess of the casino
operator's gross casino revenue. In this division, "casino
operator" and "casino gaming" have the meanings defined in section
3772.01 of the Revised Code, and "gross casino revenue" has the
meaning defined in section 5753.01 of the Revised Code.
(jj) Any receipts for which the tax imposed by this chapter
is prohibited by the constitution or laws of the United States or
the constitution of this state.
(3) In the case of a taxpayer when acting as a real estate
broker, "gross receipts" includes only the portion of any fee for
the service of a real estate broker, or service of a real estate
salesperson associated with that broker, that is retained by the
broker and not paid to an associated real estate salesperson or
another real estate broker. For the purposes of this division,
"real estate broker" and "real estate salesperson" have the same
meanings as in section 4735.01 of the Revised Code.
(4) A taxpayer's method of accounting for gross receipts for
a tax period shall be the same as the taxpayer's method of
accounting for federal income tax purposes for the taxpayer's
federal taxable year that includes the tax period. If a taxpayer's
method of accounting for federal income tax purposes changes, its
method of accounting for gross receipts under this chapter shall
be changed accordingly.
(G) "Taxable gross receipts" means gross receipts sitused to
this state under section 5751.033 of the Revised Code.
(H) A person has "substantial nexus with this state" if any
of the following applies. The person:
(1) Owns or uses a part or all of its capital in this state;
(2) Holds a certificate of compliance with the laws of this
state authorizing the person to do business in this state;
(3) Has bright-line presence in this state;
(4) Otherwise has nexus with this state to an extent that the
person can be required to remit the tax imposed under this chapter
under the Constitution of the United States.
(I) A person has "bright-line presence" in this state for a
reporting period and for the remaining portion of the calendar
year if any of the following applies. The person:
(1) Has at any time during the calendar year property in this
state with an aggregate value of at least fifty thousand dollars.
For the purpose of division (I)(1) of this section, owned property
is valued at original cost and rented property is valued at eight
times the net annual rental charge.
(2) Has during the calendar year payroll in this state of at
least fifty thousand dollars. Payroll in this state includes all
of the following:
(a) Any amount subject to withholding by the person under
section 5747.06 of the Revised Code;
(b) Any other amount the person pays as compensation to an
individual under the supervision or control of the person for work
done in this state; and
(c) Any amount the person pays for services performed in this
state on its behalf by another.
(3) Has during the calendar year taxable gross receipts of at
least five hundred thousand dollars.
(4) Has at any time during the calendar year within this
state at least twenty-five per cent of the person's total
property, total payroll, or total gross receipts.
(5) Is domiciled in this state as an individual or for
corporate, commercial, or other business purposes.
(J) "Tangible personal property" has the same meaning as in
section 5739.01 of the Revised Code.
(K) "Internal Revenue Code" means the Internal Revenue Code
of 1986, 100 Stat. 2085, 26 U.S.C. 1, as amended. Any term used in
this chapter that is not otherwise defined has the same meaning as
when used in a comparable context in the laws of the United States
relating to federal income taxes unless a different meaning is
clearly required. Any reference in this chapter to the Internal
Revenue Code includes other laws of the United States relating to
federal income taxes.
(L) "Calendar quarter" means a three-month period ending on
the thirty-first day of March, the thirtieth day of June, the
thirtieth day of September, or the thirty-first day of December.
(M) "Tax period" means the calendar quarter or calendar year
on the basis of which a taxpayer is required to pay the tax
imposed under this chapter.
(N) "Calendar year taxpayer" means a taxpayer for which the
tax period is a calendar year.
(O) "Calendar quarter taxpayer" means a taxpayer for which
the tax period is a calendar quarter.
(P) "Agent" means a person authorized by another person to
act on its behalf to undertake a transaction for the other,
including any of the following:
(1) A person receiving a fee to sell financial instruments;
(2) A person retaining only a commission from a transaction
with the other proceeds from the transaction being remitted to
another person;
(3) A person issuing licenses and permits under section
1533.13 of the Revised Code;
(4) A lottery sales agent holding a valid license issued
under section 3770.05 of the Revised Code;
(5) A person acting as an agent of the division of liquor
control under section 4301.17 of the Revised Code.
(Q) "Received" includes amounts accrued under the accrual
method of accounting.
(R) "Reporting person" means a person in a consolidated
elected taxpayer or combined taxpayer group that is designated by
that group to legally bind the group for all filings and tax
liabilities and to receive all legal notices with respect to
matters under this chapter, or, for the purposes of section
5751.04 of the Revised Code, a separate taxpayer that is not a
member of such a group.
Section 2. That existing sections 5701.11 and 5751.01 of the
Revised Code are hereby repealed.
Section 3. This act is hereby declared to be an emergency
measure necessary for the immediate preservation of the public
peace, health, and safety. The reason for such necessity is to
enable taxpayers to avoid making miscellaneous adjustments on
their 2012 tax returns that increase tax liabilities. Therefore,
this act shall go into immediate effect.
Section 4. Section 5751.01 of the Revised Code is presented
in this act as a composite of the section as amended by both Am.
Sub. H.B. 472 and Am. Sub. H.B. 510 of the 129th General Assembly.
The General Assembly, applying the principle stated in division
(B) of section 1.52 of the Revised Code that amendments are to be
harmonized if reasonably capable of simultaneous operation, finds
that the composite is the resulting version of the section in
effect prior to the effective date of the section as presented in
this act.
|