[Ord. 3692 § 1, 2011]
The title of this article is the City of Meadville earned income
and net profits tax ordinance of 2012.
[Ord. 3692 § 2, 2011]
The purpose of this article 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. 3692 § 3, 2011]
The ordinance codified in this article 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. Section
6924.101, et seq.
[Ord. 3692 § 4, 2011]
“City of Meadville”
shall mean the City of Meadville, a third class city located
in Crawford County, PA, its governing body and duly appointed representatives.
It shall also mean political subdivision or municipality as those
terms are used in this article.
“Earned income”
means the compensation as required to be reported to or as determined by the Department of Revenue under Section 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”
means 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”) means 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.
Section 6913 (until repealed effective June 30, 2012) and 53 P.S.
Section 6924.101, et seq., as same may be hereafter amended.
“Net profits”
means 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 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; and
(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; and
(3)
Any gain on the sale of other capital assets of a farm.
“Nonresident”
means a person or business domiciled outside the political
subdivision levying the tax.
“Resident”
means a person or business domiciled in the political subdivision
levying the tax.
“Tax collection committee” or “TCC”
means 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”
means the tax collection district established under Section
504 of the LTEA, encompassing political subdivisions in Crawford County
and surrounding counties.
“Tax officer”
means 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”
means a person or business required under this article to
file a return or to pay a tax.
“Tax year” or “current year”
means the calendar year for which the tax is levied.
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 article.
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[Ord. 3692 § 5, 2011]
In accordance with the provisions of the Local Tax Enabling
Act, the City of Meadville hereby levies and assesses a tax for general
revenue purposes at the rate of one percent on the earned income and
net profits, as defined, of residents of the City of Meadville, and
on the earned income, as defined, received by nonresidents for work
done or services performed or rendered in the City of Meadville, and
on the net profits of businesses, professions and other activities
conducted in the City of Meadville by nonresidents.
[Ord. 3692 § 6, 2011]
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 the ordinance codified in this article
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 the ordinance codified in this article
upon the effective date of such amendment, without the need for formal
amendment of the ordinance codified in this article, to the maximum
extent allowed by law.
[Ord. 3692 § 7, 2011]
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. 3692 § 8, 2011]
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. 3692 § 9, 2011]
Employers shall withhold, remit and report taxes imposed by
this article 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
(E) of this section, 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
(D) of this section, 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
(D) of this section 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
(C) of this section 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 28th of the succeeding year, every employer shall file with the tax officer where taxes have been deducted and remitted pursuant to subsection
(C) of this section:
(1) An annual return showing, for the period beginning January 1st of
the current year and ending December 31st 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 1st of the current year and ending December 31st 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 subsections
(D) and
(E) of this section 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 31st 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 Section 511 of the Local Tax Enabling Act
(53 P.S. Section 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. 3692 § 10, 2011]
Taxpayers shall declare and pay taxes as follows:
(A) Every
taxpayer shall, on or before April 15th 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 taxable income received during
the period beginning January 1st of the current year and ending December
31st 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 15th 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 1st and ending December 31st 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 15th of the current year,
September 15th of the current year and January 15th of the succeeding
year, respectively.
(C) Any
taxpayer who first anticipates any net profit after April 15th of
the current year shall make and file the declaration required on or
before June 15th of the current year, September 15th of the current
year or December 31st 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 15th 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 1st of the current year, and ending December
31st 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 31st 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 section
anticipates additional net profits not previously declared or has
overestimated anticipated net profits.
(F) Every
taxpayer who discontinues business prior to December 31st of the current
year, shall, within 30 days after the discontinuance of business,
file a final return as required under this section 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 15th of the current year, June 15th of the current
year, September 15th of the current year, and January 15th 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 31st of the current year, June 30th of the current
year, September 30th of the current year, and December 31st 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 15th 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. 3692 § 11, 2011]
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. 3692 § 12, 2011]
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.