The State of Ohio has mandated that all the municipal income tax departments in the state adhere to the law changes due to the passing of House Bill 5. All changes were as of 1/1/2016.
Any entity that conducts business within the Ashland City Corporate Limits is required to file an income tax form. This would include contractors, sole-proprietorships, partnerships, and corporations. The City of Ashland shall not tax an individual if the service performed was 20 days or less inside the city limits. For purposes of the 20-day calculation, any portion of a day worked in Ashland shall be counted as one day worked in Ashland. Beginning on the twenty-first day, the employer of said individual should begin withholding Ashland income tax from the individual and remit the tax to the City of Ashland Income Tax Department.
Business Questionnaires are to be filed with the Income Tax Department when a business opens up in the city.
Income Tax Returns are due April 15th of the following year after books are closed for entities that work on a calendar year. For the entities that work on fiscal year, your returns are due 4 months after the books are closed. A six-month extension can be granted in any instance, if the correct Federal Extension Form is filed with our office by the due date of the return. The Ashland City Tax Office will accept the same Federal 2% AGI (adjusted gross income) 2106 deduction only when complete and accurate documentation is provided. All business tax returns MUST be signed. If they are not signed, they will be returned and will not be considered filed until the signed copy is returned to the income tax department. All returns must also have a complete copy of the Federal 1065, 1120, 1120S, 1041, etc. attached. There is also no loss carry forward allowed from one year to another until the 2018 tax year.
Partnership losses may not offset partnership gains: each is treated as an entity.
Gains and losses from multiple rentals, if in the name of the same owner and if that owner lives in Ashland, may offset each other. If the owner lives outside Ashland, just the Ashland rentals may be used.
Rental and/or sole proprietorship gains and losses may offset if in the name of the same individual, but not W-2 wages.
S-Corporations gains and losses are to be divided by each shareholder according to their percentage share.
Withholding accounts are due at different times, depending on their filing frequency. Monthly withholding is due 15 days after the last day of the month. Example: Withholding for the month of February would be due on March 15th. Quarterly withholding is due 30 days after the end of each calendar quarter. Example: First quarter withholding (January-March) is due on April 30th. The penalty for late payment is 50% of the amount of tax not timely paid.
The interest will be the Federal short-term rate, rounded to the nearest whole percent plus 5% per annum and is charged monthly. The interest rate is subject to change annually based on the Federal short-term rate. The interest rate for 2023 is 10% per annum.
A penalty of $25/ per month will be charged if reconciliation and W-2s are not received by the due date. The maximum penalty is $150.
Contractors doing work within the city limits, regardless of the amount of time, need to fill out a Contractor Questionnaire and register with the city.
***ANY RETURNED CHECKS OR ACH PAYMENTS WILL BE ASSESSED A $15.00 CHARGE.***