INSTRUCTIONS FOR HARRISON CITY BUSINESS TAX FORM 2006

Who Must File
All corporations, partnerships, trusts, estates, LLC’s or other entities conducting business or performing services in or derive income from activities in Harrison or JEDD must file a City Income Tax return. We have mandatory filing. If for some reason, you do not have any taxable income for the year you need to return our tax form with an explanation.

When and where to file
Calendar year taxpayers need to file on or before April 16, 2007 Fiscal year taxpayers must file the return on the 15th day of 4th month from the end of such fiscal year. Returns must be filed with the Harrison Tax Department at 300 George St., Harrison, OH 45030-1515.

Extensions of Time to File
A copy of the Federal extension request form or Harrison extension request form must be received by the due date of the fiscal year return and a payment of any tax deemed to be due. Payment in full of your tax liability must accompany the extension request since an extension of time to file is not an extension of time to pay the tax due. Only requests received in duplicate with a self-addressed stamped envelope will have a copy returned after being marked approved.

INSTRUCTIONS

Part A- Tax Calculation

Line 1. Total taxable income from Federal Form 1120, 1120S, 1065, or appropriate federal schedules. Attach Federal schedules and supporting documents. Non C-Corps must use Schedule C, E, F, as a starting point in computing the net profits base. Partnerships and S-Corps must file their return as if they are C-Corporations.

Line 2A & B. Schedule X- Reconciliation with Federal Income Tax Return
General:
Schedule X is to be used by corporations and partnerships. A C-Corporation’s federal taxable income is used before net operating losses and special deductions with the following adjustments:

Items not Taxable

N. Capital gains (IRC1221 or 1231 property dispositions except to the extent the income and gains apply to those described in IRC 1245 or 1250)

O. Federally reported intangible income such as but not limited to (ORCsec.718.01 (A) (5)) includes interest, dividends, patents and copyrights. (does not include lottery winnings).

P. Amount of Federal Tax Credit to the extent they have reduced corresponding operating expenses.

Q. Other.

R. Total lines N through Q

Items not Deductible

A. Capital losses (Sec IRC 1221 or 1231 included)

B. Five percent (5%) of intangible income reported in letter O, except that from IRC 1221 property dispositions.

C and D. Taxes based on State and City income

E. Guaranteed payments or accruals to or for current or former partners or members

F. Federally deducted dividends, distributions, or amounts set aside for credited to, or distributed to investors of REIT Real Estate Investment Trusts or RIC.

G. Federal deducted amounts paid or accrued to or for qualified self-employed retirement plans, health insurance plans and life Insurance plans for owners or owner-employees of non-C Corporation entities.

H. Other

I. Total lines A through H

L. Difference between I and R and enter on Part A, Line 2c, Page 1

Line 4. Schedule Y
Business Apportionment Formula:
Schedule Y is to be used by unincorporated business, partnerships, professions associations etc., and non-resident sole proprietorships when business is conducted both inside and outside of the cities.
1. Property Value determined based on the Original cost of property not the net book value. (ORC Sec. 718.02) To determine the value of property rented and used in the business, multiply the gross annual rental by 8.
2. Gross receipts from sales made and services performed, regardless of where made or performed.
3. Total payroll wages, salaries and other compensation paid.

The purpose of this schedule is to allocate a business’ net income/loss or adjusted net income/loss (if Schedule X is used) to the City of Harrison using the three (3) factor formula. A factor may be excluded from the formula only when the factor does not exist anywhere. If Schedule Y is completed enter the average percentage in the parenthesis portion of Line 4.

Line 6. Loss from previous year(s). Operating losses may be carried forward for a maximum of three (3) years.

Line 7. Amount of income subject to Municipal Income Tax

Line 8. Compute tax at 1% of line 7

Line 9a. Estimated taxes paid during the tax year if any do not round.

Line 9b. Prior year credit applied to this year

Line 10. Enter in total credits Lines 9a and 9b

Line 11. Subtract 10 from Line 8, difference should be entered on this line. Any tax due must be paid when the return is filed. If the balance due with your return is less than $5.00, no payment need to accompany the return.

Line 12. If Line 10 is greater than Line 8, the amount will be transferred as a credit towards next year’s estimated tax unless you request a refund. NO REFUNDS UNDER $5.00.

Part B: Declaration of Estimated Tax:
Business entities (corporations, partnerships, professional entities etc,) conducting activities or producing income within the City of Harrison are required to make quarterly estimated tax payments. Quarterly payments are due on or before March 15, June 15, September 15, and December 15. Taxpayers must have 90% of their current year tax liability or 100% of their previous year’s tax liability paid through quarterly estimated tax payments by December 15. Fiscal year taxpayers should substitute corresponding dates.

Line15. Total estimated income subject to tax.

Line 16. Multiply Line 15 by 1% (.01).

Line 17. Enter credits form line 14

Line 18. Estimated balance due (subtract Line 17 from Line 16).

Line 19. Enter amount paid at least 1&Mac218;4 of Line 18. Subsequent estimated payment are due by the 15th day of the 6th, 9th, and 12th months after the beginning of the taxable year.

Line 20. Enter total amount due to Harrison Income Tax combine line 11 and line 19. No taxes less than $5.00 shall be collected or refund.

Signature, Date, and Tax Preparer Information:
The taxpayer and the return preparer signature, if other than the taxpayer, should sign and date the return. We also need a phone number to contact you if we need additional schedules.

Supporting Documents: Documentation is necessary to verify all amounts of taxable or non-taxable incomes, expenses, and deductions, as applicable.

Assistance:
If you have any question, please contact the Income Tax Department. Office hours are 8:00 AM - 4:30 PM Monday through Friday. Phone (513)367-3595 or Fax (513)367-3599.  Email the Tax Office  Additional forms can be obtained from our website: www.harrisonohio.org (tax forms).

Back to Forms Page

Back to Harrison Tax Page