[Ord. 2011-02, 11/3/2011, § 1]
The title of this Part is the "Vernon Township Earned Income
and Net Profits Tax Ordinance."
[Ord. 2011-02, 11/3/2011, § 2]
The purpose of this Part is to continue, reaffirm and update
the ordinance for the levy of the earned income and net profits tax
to meet the existing requirements of the Local Tax Enabling Act as
same has been and may be further amended.
[Ord. 2011-02, 11/3/2011, § 3]
This Part is adopted pursuant to the authority of the Local
Tax Enabling Act, Act 511 of 1965, as amended by Act 32 of 2008 and
as otherwise amended, found at 53 P.S. § 6924.101 et seq.
[Ord. 2011-02, 11/3/2011, § 4]
1. As used in this Part, the following terms shall have the meanings
indicated:
EARNED INCOME
The compensation as required to be reported to or as determined
by the Department of Revenue under § 303 of the act 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.
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,
the term includes a corporate officer.
LOCAL TAX ENABLING ACT (or "LTEA")
Act 511 of 1965, enacted December 31, 1965, P.L. 1257, as
thereafter amended, and including Act 32 adopted July 2, 2008, as
thereafter amended, which Act is found at 53 P.S. § 6913
(until repealed effective June 30, 2012) and 53 P.S. § 6924.101
et seq., as same may be hereafter amended.
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 § 303 of the act known as the
Tax Reform Code of 1971, and rules and regulations promulgated under
that section. The term does not include any:
A.
Income which:
(1)
Is not paid for services provided.
(2)
Is in the nature of earnings from an investment.
B.
Income which represents:
(1)
Any gain in the sale of farm machinery.
(2)
Any gain on the sale of livestock held 12 months or more for
draft, breeding or dairy purposes.
(3)
Any gain on the sale of other capital assets of a farm.
NONRESIDENT
A person or business domiciled outside the political subdivision
levying the tax.
RESIDENT
A person or business domiciled in the political subdivision
levying the tax.
TAX COLLECTION COMMITTEE or TCC
The committee established to govern the Crawford County Tax
District for purpose of collection of the earned income and net profits
tax.
TAX COLLECTION DISTRICT
The tax collection district established under § 504
of the LTEA, encompassing political subdivisions in Crawford County
and surrounding counties.
TAX OFFICER
The person(s) or entity(s) appointed by the tax collection
committee to collect the earned income and net profits tax for political
subdivisions within the Crawford County Tax Collection District.
TAXPAYER
A person or business required under this Part to file a return
or to pay a tax.
TOWNSHIP
Vernon Township, its governing body and duly appointed representatives.
It shall also mean political subdivision or municipality as those
terms are used in this Part.
2. The definitions as found in the Local Tax Enabling Act, as amended
from time to time are hereby incorporated herein by reference and
shall be applied in the administration and enforcement of this Part.
[Ord. 2011-02, 11/3/2011, § 5]
In accordance with the provisions of the Local Tax Enabling
Act, Vernon Township hereby levies and assesses a tax for general
revenue purposes at the rate of 1% on the earned income and net profits
of residents of Vernon Township and on the earned income and net profits
of nonresidents who receive earned income and net profits from any
work, business, profession or activity performed or rendered in Vernon
Township.
[Ord. 2011-02, 11/3/2011, § 6]
This Tax is imposed under authority of the Local Tax Enabling
Act. All provisions of the Local Tax Enabling Act that govern the
levy, administration and collection of the tax on earned income and
net profits are incorporated into this Part by reference as though
set forth herein. Any future amendments to the Local Tax Enabling
Act that are required to be applied to the levy and collection of
a tax on earned income or net profits shall automatically become part
of this Part upon the effective date of such amendment, without the
need for formal amendment of this Part, to the maximum extent allow
by law.
[Ord. 2011-02, 11/3/2011, § 7]
The tax hereby levied and assessed shall be levied and assessed
for the calendar year 2012 and each year thereafter, without annual
reenactment or levy.
[Ord. 2011-02, 11/3/2011, § 8]
This tax shall be collected and administered in accordance with
the applicable provisions of the Local Tax Enabling Act, other applicable
laws and regulations; and regulations, policies and procedures adopted
by this political subdivision, the tax collection committee, or by
the tax officer. This includes any regulations, policies, and procedures
adopted in the future to the maximum extent allowed by law.
[Ord. 2011-02, 11/3/2011, § 9]
1. Employers shall withhold, remit and report taxes imposed by this
Part as follows:
A. Every employer having an office, factory, workshop, branch, warehouse
or other place of business within a tax collection district who employs
one or more persons, other than domestic servants, for a salary, wage,
commission or other compensation, who has not previously registered,
shall, within 15 days after becoming an employer, register with the
tax officer the name and address of the employer and such other information
as the Department of Community and Economic Development (DCED) may
require.
B. An employer shall require each new employee to complete a certificate
of residency form, which shall be an addendum to the Federal Employee's
Withholding Allowance Certificate (Form W-4). An employer shall also
require any employee who changes their address or domicile to complete
a certificate of residency form. The certificate of residency form
shall provide information to help identify the political subdivisions
where an employee lives and works.
C. Every employer having an office, factory, workshop, branch, warehouse
or other place of business within a tax collection district that employs
one or more persons, other than domestic servants, for a salary, wage,
commission or other compensation, shall, at the time of payment, deduct
from the compensation due each employee employed at such place of
business the greater of the employee's resident tax or the employee's
nonresident tax as released in the official register maintained by
the DCED.
D. Except as set forth in Subsection 1E below, within 30 days following
the end of each calendar quarter, every employer shall file a quarterly
return and pay the amount of taxes deducted during the preceding calendar
quarter to the tax officer for the place of employment of each employee.
The form shall show the name, address and Social Security number of
each employee, the compensation of the employee during the preceding
three-month period, the tax deducted from the employee, the political
subdivisions imposing the tax upon the employee, the total compensation
of all employees during the preceding calendar quarter, the total
tax deducted from the employees and paid with the return and any other
information prescribed by the DCED.
E. Notwithstanding Subsection 1D above, the provisions of this subsection
shall apply if an employer has more than one place of employment in
more than one tax collection district. Within 30 days following the
last day of each month, the employer may file the return required
by Subsection 1D and pay the total amount of taxes deducted from employees
in all work locations during the preceding month to the tax officer
for either the tax collection district in which the employer's
payroll operations are located or as determined by the DCED. The return
and taxes deducted shall be filed and paid electronically. The employer
must file a notice of intention to file combined returns and make
combined payments with the tax officer for each place of employment
at least one month before filing its first combined return or making
its first combined payment. This subsection shall not be construed
to change the location of an employee's place of employment for
purposes of nonresident tax liability.
F. Any employer who, for two of the preceding four quarterly periods,
has failed to deduct the proper tax, or any part of the tax, or has
failed to pay over the proper amount of tax as required by Subsection
1C above to the tax collection district, may be required by the tax
officer to file returns and pay the tax monthly. In such cases, payments
of tax shall be made to the tax officer on or before the last day
of the month succeeding the month for which the tax was withheld.
G. On or before February 28 of the succeeding year, every employer shall
file with the tax officer where taxes have been deducted and remitted
pursuant to Subsection 1C above:
(1)
An annual return showing, for the period beginning January 1
of the current year and ending December 31 of the current year, the
total amount of compensation paid, the total amount of tax deducted,
the total amount of tax paid to the tax officer and any other information
prescribed by the DCED.
(2)
An individual withholding statement, which may be integrated
with the Federal Wage and Tax Statement (Form W-2), for each employee
employed during all or any part of the period beginning January 1
of the current year and ending December 31 of the current year, setting
forth the address and Social Security number, the amount of compensation
paid to the employee during the period, the amount of tax deducted,
the amount of tax paid to the tax officer, the numerical code prescribed
by the DCED representing the tax collection district where the payments
required by Subsection 1D and E above were remitted and any other
information required by the DCED. Every employer shall furnish one
copy of the individual withholding statement to the employee for whom
it is filed.
H. Any employer who discontinues business prior to December 31 of the
current year shall, within 30 days after the discontinuance of business,
file returns and withholding statements required under this section
and pay the tax due.
I. Except as otherwise provided in § 511 of the Local Tax
Enabling Act, 53 P.S. § 6924.511, an employer who willfully
or negligently fails or omits to make the deductions required by this
section shall be liable for payment of taxes which the employer was
required to withhold to the extent that the taxes have not been recovered
from the employee. 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
for filing of declarations and returns.
[Ord. 2011-02, 11/3/2011, § 10]
1. Taxpayers shall declare and pay taxes as follows:
A. Every taxpayer shall, on or before April 15 of the succeeding year,
make and file with the tax officer for the place of taxpayers'
residence, a final return showing the amount of taxable income received
during the period beginning January 1 of the current year and ending
December 31 of the current year, the total amount of tax due on the
taxable income, the amount of tax paid, the amount of tax that has
been withheld and the balance of tax due. All amounts reported shall
be rounded to the nearest whole dollar. At the time of filing the
final return, the taxpayer shall pay the tax officer the balance of
the tax due or shall make demand for refund or credit in the case
of overpayment.
B. Every taxpayer making net profits shall, by April 15 of the current
year, make and file with the tax officer for the place of taxpayer's
residence a declaration of the taxpayer's estimated net profits
during the period beginning January 1 and ending December 31 of the
current year, and shall pay to the tax officer in four equal quarterly
installments the tax due on the estimated net profits. The first installment
shall be paid at the time of filing the declaration, and the other
installments shall be paid on or before June 15 of the current year,
September 15 of the current year and January 15 of the succeeding
year, respectively.
C. Any taxpayer who first anticipates any net profit after April 15
of the current year shall make and file the declaration required on
or before June 15 of the current year, September 15 of the current
year or December 31 of the current year, whichever date next follows
the date on which the taxpayer first anticipates such net profit,
and shall pay to the tax officer in equal installments the tax due
on or before the quarterly payment dates that remain after the filing
of the declaration.
D. Every taxpayer shall, on or before April 15 of the succeeding year,
make and file with the tax officer for the place of taxpayer's
residence a final return showing the amount of net profits earned
or received based on the method of accounting used by the taxpayer
during the period beginning January 1 of the current year and ending
December 31 of the current year, the total amount of tax due on the
net profits and the total amount of tax paid. At the time of filing
the final return, the taxpayer shall pay to the tax officer 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 the estimated tax, elect to make and file with the
resident tax officer on or before January 31 of the succeeding year,
the final return.
E. The DCED, in consultation with the Department of Revenue, shall provide
by regulation for the filing of adjusted declarations of estimated
net profits and for the payments of the estimated tax in cases where
a taxpayer who has filed the declaration required under this subsection
anticipates additional net profits not previously declared or has
overestimated anticipated net profits.
F. Every taxpayer who discontinues business prior to December 31 of
the current year, shall, within 30 days after the discontinuance of
business, file a final return as required under this subsection and
pay the tax due.
G. Every taxpayer who receives any other taxable income not subject
to withholding under the Local Tax Enabling Act shall make and file
with the tax officer for the place of taxpayer's residence a
quarterly return on or before April 15 of the current year, June 15
of the current year, September 15 of the current year, and January
15 of the succeeding year, setting forth the aggregate amount of taxable
income not subject to withholding by the taxpayer 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, and subject to tax, together with such other information
as the department may require. Every taxpayer filing a return shall,
at the time of filing the return, pay to the tax officer the amount
of tax due. The department shall establish criteria under which the
tax officer may waive the quarterly return and payment of the tax
and permit a taxpayer to file the receipt of taxable income on the
taxpayer's annual return and pay the income tax due on or before
April 15 of the succeeding year.
H. For a taxpayer whose fiscal year is not a calendar year, the tax
officer shall establish deadlines for filing, reporting and payment
of taxes which provide time periods equivalent to those provided for
a calendar year taxpayer.
[Ord. 2011-02, 11/3/2011, § 11]
The tax officer appointed by the tax collection committee is
hereby authorized and directed to take such actions to collect and
remit the earned income and net profits tax hereby levied as are authorized
by the Local Tax Enabling Act, as amended from time to time, and shall
carry out those responsibilities in accordance with the requirements
of the Local Tax Enabling Act.
[Ord. 2011-02, 11/3/2011, § 12]
The tax officer is hereby authorized to take any and all actions
authorized by the Local Tax Enabling Act as amended from time to time,
and as otherwise permitted by law to determine and to collect taxes
owed.
[Ord. 2011-02, 11/3/2011, § 13]
1. Except as provided in Subsection
2 below, if the tax is not paid when due, interest at the rate the taxpayer is required to pay to the Commonwealth under § 806 of the Act of April 9, 1929 (P.L. 343, No. 176), known as the Fiscal Code, on the amount of the tax, and an additional penalty of 1% of the amount of the unpaid tax for each month or fraction of a month during which the tax remains unpaid shall be added and collected but the amount shall not exceed 15% in the aggregate. Where an action is brought for the recovery of the tax, the taxpayer liable for the tax shall, in addition, be liable for the costs of collection, interest and penalties.
2. The tax officer, with the concurrence of the tax collection committee,
may abate interest or penalties that would otherwise be imposed for
the nonreporting and underreporting of income tax liabilities or for
the nonpayment of taxes previously imposed and due if the taxpayer
voluntarily files delinquent returns and pays the taxes in full. The
provisions of this subsection shall not affect or terminate any petitions,
investigations, prosecutions or other proceedings pending under this
Part, or prevent the commencement or further prosecution of any proceedings
by the proper authorities for violations of this Part.
[Ord. 2011-02, 11/3/2011, § 14]
1. Any taxpayer who fails, neglects or refuses to make any declaration
or return required by this Part, any employer who fails, neglects
or refuses to register, keep or supply records or returns required
by the LTEA or to pay the tax deducted from employees, or fails, neglects
or refuses to deduct or withhold the tax from employees, any taxpayer
or employer who refuses to permit the tax officer appointed by a tax
collection committee or an employee or agent of the tax officer to
examine books, records and papers, and any taxpayer or employer who
knowingly makes any incomplete, false or fraudulent return, or attempts
to do anything whatsoever to avoid the full disclosure of the amount
of income in order to avoid the payment of income taxes shall, upon
conviction thereof, be sentenced to pay a fine of not more than $2,500
for each offense and reasonable costs, and in default of the payment
of said fine and costs, to imprisonment for not more than six months.
2. Any employer required under this Part to collect, account for and
distribute taxes who willfully fails to collect or truthfully account
for and distribute taxes, commits a misdemeanor and shall, upon conviction,
be sentenced to pay a fine not exceeding $25,000 or to imprisonment
not exceeding two years, or both.
3. The penalties imposed under this subsection shall be in addition
to any other costs and penalties imposed by this Part.
4. The failure of any person to obtain forms required for making the
declaration or returns require by this Part shall not excuse the person
from making the declaration or return.
[Ord. 2011-02, 11/3/2011, § 17]
This Part shall be effective at the earliest possible time permitted
in accordance with the applicable provisions of the laws governing
this political subdivision and the tax hereby levied shall be effective
for calendar year 2012 and each year thereafter.