Explanation
This ordinance amends Sections 362.014, 362.03, and 362.067 of the Columbus City Codes to bring the Code into conformity with Ohio Revised Code Chapter 718, Municipal Income Tax.
This ordinance also amends Section 362.081 of the Columbus City Codes to further clarify the circumstances under which a resident individual taxpayer may seek a nonrefundable credit for municipal income taxes already paid on the resident’s distributive or proportionate share of the income of a pass-through entity.
Sections 362.014, 362.03, and 362.017
R.C. Section 718.04(A) provides that a municipal corporation that levies an income tax may not enact code provisions that conflict with R.C. Chapter 718.
The 133rd Ohio General Assembly enacted House Bill (H.B.) 166, the State’s general appropriations bill for the biennium, which modified R.C. Chapter 718 in two ways that necessitate modifications to the Columbus City Codes. First, H.B. 166 amended R.C. Section 718.01 by defining the terms “pension” and “retirement benefit plan.” Under the Ohio Revised Code, pensions and retirement benefit payments are “exempt income” not subject to municipal income taxation. R.C. § 718.01(C)(3). By defining “pension” to include retirement benefit plans that do not qualify for federal income tax deferment or exemption from FICA or Medicare taxes, H.B. 166, in effect, prevents municipalities from treating nonqualified deferred compensation plans, including selective executive retirement plans, as taxable income. Because both terms were previously undefined in the Ohio Revised Code, the City of Columbus adopted code provisions in 2014 that treat such nonqualified deferred compensation plans as taxable income. Therefore, the Code must be amended to bring it into conformity with R.C. Chapter 718, as amended by H.B. 166.
Second, H.B. 166 amended certain provisions of R.C. Sections 718.80 to 718.95, which permit non-individual taxpayers doing business in Columbus to elect to be su...
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