2015 023 Ordinance - Laserfiche WebLink

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SECTION 3 IMPOSITION OF TAX. The income tax levied by the Village at a rate of two percent (2%) is levied on the Municipal Taxable Income of every person residing in and/or earning and/or receiving income in the Village. Individuals. (A) For residents of the Village; the income tax levied herein shall be on all income, salaries, qualifying wages, commissions, and other compensation from whatever source earned or received by the resident, including the resident's distributive share of the net profit of pass-through entities owned directly or indirectly by the resident and any net profit of the resident. This is further detailed in the defmition of income (Section 2 (C)(16)). (B) For nonresidents, all income, salaries, qualifying wages, commissions, and other compensation from whatever source earned or received by the nonresident for work done, services performed or rendered, or activities conducted in the municipal corporation, including any net profit of the nonresident, but excluding the nonresident's distributive share of the net profit or loss of only pass-through entities owned directly or indirectly by the nonresident. (C) For residents and nonresidents, income can be reduced to "Municipal Taxable Income" as defined in Section 2 (C)(21). Exemptions which may apply are specified in Section 2 (C)(12). Refundable credit for Nonqualified Deferred Compensation Plan. (D)(1) As used in this division: (a) "Nonqualified deferred compensation plan" means a compensation plan described in Section 3121(v)(2)(C) of the Internal Revenue Code. (b) "Qualifying loss" means the amount of compensation attributable to a taxpayer's nonqualified deferred compensation plan, less the receipt of money and property attributable to distributions from the nonqualified deferred compensation plan. Full loss is sustained if no distribution of money and property is made by the nonqualified deferred compensation plan. The taxpayer sustains a qualifying loss only in the taxable year in which the taxpayer receives the final distribution of money and property pursuant to that nonqualified deferred compensation plan. (c)(i) "Qualifying tax rate" means the applicable tax rate for the taxable year for which the taxpayer paid income tax to the Village with respect to any portion of the total amount of compensation the payment of which is deferred pursuant to a nonqualified deferred compensation plan. (ii) If different tax rates applied for different taxable years, then the "qualifying tax rate" is a weighted average of those different tax rates. The weighted average shall be based upon the tax paid to the Village each year with respect to the nonqualified deferred compensation plan. (d) "Refundable credit" means the amount of the Village income tax that was paid on the non- distributedportion, if any, of a nonqualified deferred compensation plan. 14