Income Tax Department

IMPORTANT LAW CHANGE
INCOME TAX RETURNS DUE APRIL 15!
As of January 1, 2004 the definition of wages subject to withholding has changed. The Ohio Revised Code Sec. 718.03 now requires all employers to withhold Municipal Income Tax on wages as defines by Sec. 3121 (a) of the Internal Revenue Code (IRC). For most employees this is Box 5 of the W-2 and represents the “Medicare” wage.

Under this definition amounts paid under IRC Sec. 125 (“Cafeteria Plans”) are not subject to taxation.

As a reminder, all Deferred Compensation (both qualified and non-qualified) is still taxed when earned. Supplemental Unemployment (SUB and SUCB) payments are still taxable, and employer is responsible for the collection and payment of this tax.
In addition, the “$150 De minimus Provision” which had previously been in ORC Sec. 718.03 has been eliminated.

Please review your withholding policies and software settings to be sure they are consistent with the above changes.

Please feel free to contact us, your City Income Tax Department, if any questions should arise. Our phone number is 330-971-8220. Office operating hours are Monday through Friday 8:00am to 5:00pm, excluding holidays.