With the deadline bearing down on us, Portsmouth City Auditor Trent Williams says residents need to know the new tax laws that have gone into effect.
“We’ve gone several years with little to no changes in the income tax ordinances. Now with the changes in Section 718 of the Ohio Revised Code due to House Bill 85, cities all over Ohio have been required to modify their entire tax code,” Williams said. “Our tax ordinance used to be about 11 pages and is now 56 pages long.”
He said, because of the economic downturn over the past several years, City Council passed ordinances changing some of its tax rules such as implementing mandatory filing and reduced credit for tax paid to other municipalities. The city’s new income tax rate of 2.5 percent that was approved last year also became effective on Jan. 1 for the 2016 tax year.
“One of the changes that actually took place for the 2014 tax year was mandatory filing. This is more common now in most cities around Ohio than in the past,” Williams said. “This is one way we try to make sure that everyone is paying their share and not slipping through the cracks. There are some exemptions and we have made a simple form that people that are exempt can fill out.”
Williams said an example of those who are exempt would be retirees with no other source of income except for a pension. They would be exempt, but still, under the law, must file a one-time exemption. He said the forms are available on the city’s website or in his office. If you’re not sure if you have to file, you can call the tax office.
“Another change in effect for this, the 2015 tax filing year, is the reduction of credit for tax paid to another city of village,” Williams said. “Where a resident of the city of Portsmouth is subject to a municipal income tax in another municipality, he shall receive a credit of the tax paid to another municipality or municipalities up to 50 percent of the amount owed the city of Portsmouth, Ohio.”
That credit was previously 100 percent, but, like many other cities, it was reduced to minimize lost tax revenue within the city.
“The city tax forms look a little more complicated than they really are. But for most people with just wages from an employer, they are fairly easy to complete,” Williams said. “Again, the tax office can answer questions or help with filling out the local tax form. This form is also available online.”
He said plans for next year are to implement electronic filing much like people do now with their state and federal returns.
“Because of these sweeping changes and reform, we want Portsmouth citizens and taxpayers to be advised of the changes that may affect them,” Williams said. “Not everyone will be affected by these changes but some will. So the best thing to do is just call the tax office if you have any questions or to discuss any questions with a personal tax advisor.”
Reach Frank Lewis at 740-353-3101, ext. 1928, or on Twitter @franklewis.