[Adopted 6-27-2006 by Ord. No. 06-11]
[Amended 12-30-2013 by Ord. No. 13-05]
A. 
The definitions set forth in Section 501, as amended, of the Local Tax Enabling Act, 53 P.S. 6924.501, are hereby adopted and included by reference as if set forth fully herein. Without limiting the generality of the foregoing, the following words and phrases, when used in this article, shall have the meanings ascribed to them in this section, except where the context clearly indicates or requires a different meaning:
ASSOCIATION
A partnership, limited partnership, or any other form of unincorporated enterprise owned by two or more persons.
BUSINESS
An enterprise, activity, profession or any other undertaking of an unincorporated nature conducted for profit or ordinarily conducted for profit, whether by a person, partnership, association or any other entity.
BUSINESS ENTITY
A sole proprietorship, corporation, joint-stock association or company, partnership, limited partnership, limited liability company, association, business trust, syndicate or other commercial or professional activity organized under the laws of this commonwealth or any other jurisdiction.
COLLECTOR
The tax officer for the administration and collection of the income taxes of the Township, appointed and acting pursuant to the various provisions of the Local Tax Enabling Act and this article.
CORPORATION
A corporation or joint-stock association organized under the laws of the United States, the Commonwealth of Pennsylvania or any other state, territory, foreign country or dependency.
CURRENT YEAR
The calendar year for which the tax is levied.
DEPARTMENT
The Department of Community and Economic Development of the Commonwealth.
DOMICILE
The place where a person lives and has a permanent home and to which the person has the intention of returning whenever absent. Actual residence is not necessarily domicile, for domicile is the fixed place of abode which, in the intention of the taxpayer, is permanent rather than transitory. Domicile is the voluntarily fixed place of habitation of a person, not for a mere special or limited purpose, but with the present intention of making a permanent home, until some event occurs to induce the person to adopt some other permanent home. In the case of a business, domicile is that place considered as the center of business affairs and the place where its functions are discharged.
EARNED INCOME
The compensation as required to be reported to or as determined by the Department of Revenue under Section 303 of the Act of March 4, 1971 (P.L. 6, No. 2), known as the "Tax Reform Code of 1971," and rules and regulations promulgated under that section. Employee business expenses as reported to or determined by the Department of Revenue under Article III of the Tax Reform Code of 1971 shall constitute allowable deductions in determining earned income. The term does not include offsets for business losses. The amount of any housing allowance provided to a member of the clergy shall not be taxable as earned income. Without limiting the generality of the foregoing, and unless specifically superseded by statute or regulation of the commonwealth, earned income shall include salaries, wages, commissions, bonuses, incentive payments, fees and tips and other compensation that may accrue or be received by an individual for services rendered, whether directly or through an agent and whether in case or in property, but shall not include periodic payments for sick or disability benefits and those commonly recognized as old-age benefits, retirement pay or pensions paid to persons retired from service after reaching a specific age or after a stated period of employment, nor public assistance or unemployment compensation payments, nor any wages or compensation paid by the United States to any person for active service in the Army, Navy or Air Force of the United States or the Commonwealth of Pennsylvania or any other state for such service.
EMPLOYER
A person, business entity or other entity employing one or more persons for a salary, wage, commission or other compensation. The term includes the commonwealth, a political subdivision, and an instrumentality or public authority of either. For purposes of penalties under this article, the term includes a corporate officer.
MUNICIPALITY
The Township of Middletown, Bucks County, Pennsylvania.
NET PROFITS
The net income from the operation of a business other than a corporation, as required to be reported to or as determined by the Department of Revenue under Section 303 of the Act of March 4, 1971 (P.L. 6, No. 2), known as the "Tax Reform Code of 1971," and rules and regulations promulgated under that section. Without limiting the generality of the foregoing, and unless specifically superseded by statute or regulation of the commonwealth, net profits shall include the net income from the operation of a business, profession or enterprise, except corporations, after provisions for all costs and expenses incurred in the conduct thereof, either paid or accrued in accordance with the accounting system used in such business, profession or enterprise, but without deduction of taxes based on income. Without limiting the generality of the foregoing, and unless specifically superseded by statute or regulation of the commonwealth, net profits shall not include:
(1) 
Income, which:
(a) 
Is not paid for services provided; and
(b) 
Is in the nature of earnings from an investment.
(2) 
Income, which represents:
(a) 
Any gain on the sale of farm machinery;
(b) 
Any gain on the sale of livestock held 12 months or more for draft, breeding or dairy purposes; or
(c) 
Any gain on the sale of other capital assets of a farm.
NONRESIDENT
A person or business domiciled outside of the Township of Middletown.
PERSON
A natural person, partnership, corporation, fiduciary or association. Whenever used in any section prescribing and imposing a penalty, the term "person" as applied to associations shall mean the partners or members thereof and, as applied to corporations, the officers thereof.
PRECEDING YEAR
The calendar year before the current year.
PRIVATE AGENCY
A business entity or person appointed as the Tax Officer.
RESIDENT
A person or business domiciled in the Township of Middletown.
SUCCEEDING YEAR
The calendar year following the current year.
TAX OFFICER
The political subdivision, public employee, tax bureau, county or private agency which administers and collects income taxes for the Township pursuant to and in accordance with the Local Tax Enabling Act.
TAXABLE INCOME
Earned income and net profits.
TAXPAYER
A person, whether an individual, partnership, association or any other entity, required hereunder to file a return of earnings or net profits or to pay a tax thereon.
B. 
Word usage. The singular shall include the plural, and the masculine shall include the feminine and neuter.
A. 
A tax for general revenue purposes of 1% is hereby imposed on the following:
(1) 
Earned income, as defined by this article, received by residents of the Township on and after such date as may be fixed by resolution of the Board of Supervisors;
(2) 
Earned income, as defined by this article, received by nonresidents of the Township for work done or services performed or rendered in the Township on and after such date as may be fixed by resolution of the Board of Supervisors;
(3) 
Net profits earned on and after such date as may be fixed by resolution of the Board of Supervisors of businesses, professions and other activities conducted by residents of the Township; and
(4) 
Net profits earned on and after such date as may be fixed by resolution of the Board of Supervisors of businesses, professions and other activities conducted in the Township by nonresidents.
B. 
The tax levied under Subsection A(1) and (2) herein shall relate to and be imposed upon salaries, wages, commissions and other compensation paid by an employer or on his behalf to any person who is employed by or renders services to him. The tax levied under Subsection A(3) and (4) herein shall relate to and be imposed on the net profits of any business, profession or enterprise carried on by any person as owner or as proprietor, either individually or in association with some other person or persons.
C. 
Any person whose total income from all sources is less than $12,000 per annum shall be exempt from the imposition and levy of the tax set forth in this section.
[Added 12-30-2013 by Ord. No. 13-05]
A. 
Declaration and payment of net profits tax.
(1) 
On or before June 15 of the current year, September 15 of the current year, and January 15 of the succeeding year, every taxpayer who receives net profits or any earnings shall make and file with the Collector, on a form prescribed by him, a return or declaration showing his estimated net profits or earnings for the period commencing January 1 and ending December 31 of the current tax year.
(2) 
The declaration or return shall show the amount of tax imposed by this article on such estimated net profits or earned income received by the taxpayer and the balance due. The taxpayer making the declaration or return shall, at the time of filing thereof, pay to the Collector the amount of tax shown as due thereon.
(3) 
On or before April 15 of the succeeding year, every taxpayer shall make and file with the Collector, on a form prescribed by him, a final return or declaration showing the amount of net profits or earned income received during the period commencing January 1 of the current year and ending on December 31 of the current year, the total amount of tax due thereon, and the total amount of tax paid thereon. At the time of filing the final return, the taxpayer shall pay to the Collector the balance of tax due or shall make demand for refund or credit in the case of overpayment. Any taxpayer may, in lieu of paying the fourth quarterly installment of his estimated tax, elect to make and file with the Collector on or before January 31 of the succeeding year the final return as hereinabove required.
(4) 
Every taxpayer who discontinues business prior to December 31 of a given tax year shall, within 15 days after the discontinuance of business, file his final return as hereinabove required and pay the tax due.
B. 
Declaration and payment of earned income tax.
(1) 
Every taxpayer who is employed for a salary, wage, commission or other compensation and who received any earned income not subject to the provisions of § 448-604 herein shall, on or before April 30 of the current year, July 31 of the current year, October 31 of the current year and January 31 of the succeeding year, make and file with the Collector, on a form prescribed by him, a return or declaration showing his aggregate amount of income not subject to withholding by him during the three-month periods ending March 31 of the current year, June 30 of the current year, September 30 of the current year and December 31 of the current year, respectively, together with such other information that the Collector may require. Every taxpayer making such return shall, at the time of filing thereof, pay to the Collector the amount of tax shown as due thereon.
(2) 
On or before April 15 of the succeeding year, every taxpayer shall make and file with the Collector, on a form prescribed by him, a final return or declaration showing the amount of earned income received during the period commencing January 1 of the current year and ending on December 31 of the current year; the taxpayer shall pay to the Collector the balance of tax due or shall make demand for refund or credit in the case of overpayment. Any taxpayer may, in lieu of paying the fourth quarterly installment of his estimated tax, elect to make and file a return as hereinabove required.
(3) 
Every employee receiving any earnings which are not subject to the provisions of § 448-604 of this article relating to collection at source, whose liability to the Township ceases prior to December 31 of a given tax year, shall, within 15 days after such termination, file his final return as hereinabove required and pay the tax due.
A. 
Every person within the Township who employs one or more persons on a salary, wage, commission or other compensation basis, other than domestic servants, shall, on or before April 15 of the subsequent year or within 15 days after becoming an employer, register with the Collector his name and address and such other information as the Collector may require.
B. 
Every person within the Township who employs one or more persons on a salary, wage, commission or other compensation basis, other than domestic servants, shall deduct monthly or more often than monthly at the time of payment thereof the tax imposed by this article on the earned income, as defined by this article, due to his employee or employees and shall, on or before April 15 of the subsequent year and on or before the 15th day of each succeeding calendar quarter, file a return of taxes deducted on a form prescribed by the Collector and pay to the Collector the amount of tax deducted for the preceding quarter.
C. 
On or before February 28 of the succeeding year, every such employer shall file with the Collector on forms prescribed by him: an annual return showing the total amount of earned income paid and total amount of tax deducted, and the total amount of tax paid to the Collector during the period commencing January 1 of the current tax year and ending December 31 of the current tax year; and a return for each employee employed during all or any part of the period commencing January 1 of the current tax year and ending December 31 of the current tax year, setting forth the employee's name, address and social security number, the amount of earned income paid to the employee during said period, the amount of tax deducted, the amount of tax paid to the Collector, and such other information as the Collector may require. Every employer shall furnish a copy of the individual return to the employee for whom it is filed.
D. 
Every employer who discontinues business prior to December 31 of the current tax year shall, within 15 days after the discontinuance of business, file the returns hereinabove required and pay the tax due.
E. 
The failure or omission of any employer to make the deductions required by this section shall not relieve any employee from the payment of the tax or from complying with the requirements of this article relating to the filing of declarations and returns.
A. 
It shall be the duty of the Collector to collect and receive the taxes, fines and penalties imposed by this article. It shall also be his duty to keep a record showing the amount received by him from each person paying the tax and the date of such receipt.
B. 
The Collector is hereby charged with the administration and enforcement of the provisions of this article and is hereby empowered to prescribe, adopt, promulgate and enforce rules and regulations relating to any matter pertaining to the administration and enforcement of this article, including provisions for the reexamination and correction of declarations and returns and of payments alleged or found to be incorrect or as to which an overpayment is claimed or found to have occurred, and to prescribe forms necessary for the administration of this article.
C. 
The Collector and agents designated by him are hereby authorized to examine the books, papers and records of any employer or supposed employer or of any taxpayer or supposed taxpayer in order to verify the accuracy of any declaration or return or, if no declaration or return was filed, to ascertain the tax due. Every employer or supposed employer and every taxpayer or supposed taxpayer is hereby directed and required to give to the Collector or to any agent designated by him the means, facilities and opportunity for such examinations and investigations as are hereby authorized.
D. 
Any information gained by the Collector, his agents or by any other official or agent of the Township as a result of any declarations, returns, investigations, hearings or verifications required or authorized by this article shall be confidential except in accordance with a proper judicial order or as otherwise provided by law.
E. 
Any person aggrieved by any action of the Collector shall have the right of appeal as provided by law.
A. 
The Collector may sue for the recovery of taxes due and unpaid under this article.
B. 
Any suit brought to recover the tax imposed by this article shall be begun within three years after such tax is due or within three years after a declaration or return has been filed, whichever date is later; provided, however, that this limitation shall not prevent the institution of a suit for the collection of any tax due or determined to be due in the following cases:
(1) 
Where no declaration or return was filed by any person, although a declaration or return was required to be filed by him under the provisions of this article, there shall be no limitation.
(2) 
Where an examination of the declaration or return in the possession of the Collector or any other evidence relating to such declaration or return reveals a fraudulent evasion of taxes, there shall be no limitation.
(3) 
Where any person has deducted taxes under the provisions of this article and has failed to pay the amounts so deducted to the Collector, or where any person has willfully failed or omitted to make the deductions required by this article, there shall be no limitation.
(4) 
In the case of substantial understatement of tax liability of 25% or more and no fraud, suit shall be instituted within six years.
(5) 
The Collector may file suit for the recovery of an erroneous refund, provided that such civil action is filed within two years of the date such refund is made. However, if it appears that any such refund was induced by fraud or misrepresentation of material fact, then such action may be brought within five years of same. The Township shall also be entitled to employ all other means of collection authorized by law.
If for any reason the tax is not paid when due, interest at the rate of 6% per annum on the amount of the tax and an additional penalty of 0.5% of the amount of the unpaid tax for each month or fraction thereof during which the tax remains unpaid shall be added and collected. Where suit is brought for the recovery of any such tax, the person liable therefor shall, in addition, be liable for the costs of collection and the interest and penalties herein imposed, together with attorneys' fees when authorized by law.
The Collector is hereby authorized to accept payment under protest of the amount of tax claimed by the Township in any case where any person disputes the validity or amount of the Township's claim for the tax. If it is thereafter judicially determined by a court of competent jurisdiction that there has been an overpayment to the Collector, the amount of overpayment shall be refunded to the person who paid under protest.
A. 
The tax imposed by this article shall not apply:
(1) 
To any person as to whom it is beyond the legal power of the Township to impose the tax herein provided for under the Constitution of the United States and the Constitution and laws of the Commonwealth of Pennsylvania.
(2) 
To institutions or organizations operated for public, religious, educational or charitable purposes, to institutions or organizations not organized or operated for private profit, or to trusts and foundations established for any of the said purposes.
B. 
This section shall not be construed to exempt any person who is an employer from the duty of collecting the tax at source from his employees and paying the amount collected to the Collector under the provisions of § 448-604 of this article.
A. 
Any person who fails, neglects or refuses to make any declaration or return required by this article; any employer who fails, neglects or refuses to register or to pay the tax deducted from his employees; any person who refuses to permit the Collector or any agent designated by him to examine his books, records and papers; and any person who makes any incomplete, false or fraudulent return or attempts to do anything whatsoever to avoid the full disclosure of the amount of his net profits or earnings to avoid the payment of the whole or any part of the tax imposed by this article shall, upon conviction thereof before any Magisterial District Judge or court of competent jurisdiction, be sentenced to pay a fine of not more than $500 for each offense and costs and, in default of payment of said fine and costs, to be imprisoned in the County Jail for a period not exceeding 30 days.
B. 
Any person who divulges any information which is confidential under the provisions of § 448-605D of this article shall, upon conviction thereof before any Magisterial District Judge or court of competent jurisdiction, be sentence to pay a fine of not more than $500 for each offense and costs and, in default of payment of said fine and costs, to be imprisoned in the Bucks County Jail for a period not exceeding 30 days.
C. 
The penalties imposed under this section shall be in addition to any other penalty imposed by any other section of this article.
D. 
The failure of any person to receive or procure the forms required for making the declaration or returns required by this article shall not excuse him from making such declaration or return.
Any ordinance or any part of any article conflicting with the provisions of this article is hereby repealed, so far as the same affects this article. Further, it is the intention of the Board that this article be interpreted in a manner consistent with the Act and that any conflict between the provisions of this article and the Act be resolved so that the provisions of the Act control. The provisions of the Act that are inconsistent with this article (if any) are incorporated herein as though set forth at length.
[Amended 12-30-2013 by Ord. No. 13-05]
This article is effective January 1, 2014, by virtue of the adoption of Resolution No. 13-27R of the Board of Supervisors imposing and levying the taxes provided for hereinabove and providing for the collection of the same, all of which such taxes shall be in force and shall continue on a fiscal and calendar year basis hereafter without annual reenactment by the Township.