Bill Text: OH SB177 | 2009-2010 | 128th General Assembly | Introduced
Bill Title: That is scheduled to take effect January 1, 2010, to continue the provisions of this act on and after that effective date, and to make appropriations.
Spectrum: Slight Partisan Bill (Republican 7-3)
Status: (Introduced - Dead) 2009-09-29 - To Finance & Financial Institutions [SB177 Detail]
Download: Ohio-2009-SB177-Introduced.html
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Senators Seitz, Cates
Cosponsors:
Senators Grendell, Hughes, Patton, Goodman, Niehaus, Smith, Turner, Sawyer
To amend section 5747.01 of the Revised Code and to | 1 |
amend Section 265.10 of Am. Sub. H.B. 1 of the | 2 |
128th General Assembly to partially decouple Ohio | 3 |
law from recent federal tax law changes, and to | 4 |
amend the version of section 5747.01 of the | 5 |
Revised Code that is scheduled to take effect | 6 |
January 1, 2010, to continue the provisions of | 7 |
this act on and after that effective date, and to | 8 |
make appropriations. | 9 |
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That section 5747.01 of the Revised Code be | 10 |
amended to read as follows: | 11 |
Sec. 5747.01. Except as otherwise expressly provided or | 12 |
clearly appearing from the context, any term used in this chapter | 13 |
that is not otherwise defined in this section has the same meaning | 14 |
as when used in a comparable context in the laws of the United | 15 |
States relating to federal income taxes or if not used in a | 16 |
comparable context in those laws, has the same meaning as in | 17 |
section 5733.40 of the Revised Code. Any reference in this chapter | 18 |
to the Internal Revenue Code includes other laws of the United | 19 |
States relating to federal income taxes. | 20 |
As used in this chapter: | 21 |
(A) "Adjusted gross income" or "Ohio adjusted gross income" | 22 |
means federal adjusted gross income, as defined and used in the | 23 |
Internal Revenue Code, adjusted as provided in this section: | 24 |
(1) Add interest or dividends on obligations or securities of | 25 |
any state or of any political subdivision or authority of any | 26 |
state, other than this state and its subdivisions and authorities. | 27 |
(2) Add interest or dividends on obligations of any | 28 |
authority, commission, instrumentality, territory, or possession | 29 |
of the United States to the extent that the interest or dividends | 30 |
are exempt from federal income taxes but not from state income | 31 |
taxes. | 32 |
(3) Deduct interest or dividends on obligations of the United | 33 |
States and its territories and possessions or of any authority, | 34 |
commission, or instrumentality of the United States to the extent | 35 |
that the interest or dividends are included in federal adjusted | 36 |
gross income but exempt from state income taxes under the laws of | 37 |
the United States. | 38 |
(4) Deduct disability and survivor's benefits to the extent | 39 |
included in federal adjusted gross income. | 40 |
(5) Deduct benefits under Title II of the Social Security Act | 41 |
and tier 1 railroad retirement benefits to the extent included in | 42 |
federal adjusted gross income under section 86 of the Internal | 43 |
Revenue Code. | 44 |
(6) In the case of a taxpayer who is a beneficiary of a trust | 45 |
that makes an accumulation distribution as defined in section 665 | 46 |
of the Internal Revenue Code, add, for the beneficiary's taxable | 47 |
years beginning before 2002, the portion, if any, of such | 48 |
distribution that does not exceed the undistributed net income of | 49 |
the trust for the three taxable years preceding the taxable year | 50 |
in which the distribution is made to the extent that the portion | 51 |
was not included in the trust's taxable income for any of the | 52 |
trust's taxable years beginning in 2002 or thereafter. | 53 |
"Undistributed net income of a trust" means the taxable income of | 54 |
the trust increased by (a)(i) the additions to adjusted gross | 55 |
income required under division (A) of this section and (ii) the | 56 |
personal exemptions allowed to the trust pursuant to section | 57 |
642(b) of the Internal Revenue Code, and decreased by (b)(i) the | 58 |
deductions to adjusted gross income required under division (A) of | 59 |
this section, (ii) the amount of federal income taxes attributable | 60 |
to such income, and (iii) the amount of taxable income that has | 61 |
been included in the adjusted gross income of a beneficiary by | 62 |
reason of a prior accumulation distribution. Any undistributed net | 63 |
income included in the adjusted gross income of a beneficiary | 64 |
shall reduce the undistributed net income of the trust commencing | 65 |
with the earliest years of the accumulation period. | 66 |
(7) Deduct the amount of wages and salaries, if any, not | 67 |
otherwise allowable as a deduction but that would have been | 68 |
allowable as a deduction in computing federal adjusted gross | 69 |
income for the taxable year, had the targeted jobs credit allowed | 70 |
and determined under sections 38, 51, and 52 of the Internal | 71 |
Revenue Code not been in effect. | 72 |
(8) Deduct any interest or interest equivalent on public | 73 |
obligations and purchase obligations to the extent that the | 74 |
interest or interest equivalent is included in federal adjusted | 75 |
gross income. | 76 |
(9) Add any loss or deduct any gain resulting from the sale, | 77 |
exchange, or other disposition of public obligations to the extent | 78 |
that the loss has been deducted or the gain has been included in | 79 |
computing federal adjusted gross income. | 80 |
(10) Deduct or add amounts, as provided under section | 81 |
5747.70 of the Revised Code, related to contributions to variable | 82 |
college savings program accounts made or tuition units purchased | 83 |
pursuant to Chapter 3334. of the Revised Code. | 84 |
(11)(a) Deduct, to the extent not otherwise allowable as a | 85 |
deduction or exclusion in computing federal or Ohio adjusted gross | 86 |
income for the taxable year, the amount the taxpayer paid during | 87 |
the taxable year for medical care insurance and qualified | 88 |
long-term care insurance for the taxpayer, the taxpayer's spouse, | 89 |
and dependents. No deduction for medical care insurance under | 90 |
division (A)(11) of this section shall be allowed either to any | 91 |
taxpayer who is eligible to participate in any subsidized health | 92 |
plan maintained by any employer of the taxpayer or of the | 93 |
taxpayer's spouse, or to any taxpayer who is entitled to, or on | 94 |
application would be entitled to, benefits under part A of Title | 95 |
XVIII of the "Social Security Act," 49 Stat. 620 (1935), 42 U.S.C. | 96 |
301, as amended. For the purposes of division (A)(11)(a) of this | 97 |
section, "subsidized health plan" means a health plan for which | 98 |
the employer pays any portion of the plan's cost. The deduction | 99 |
allowed under division (A)(11)(a) of this section shall be the net | 100 |
of any related premium refunds, related premium reimbursements, or | 101 |
related insurance premium dividends received during the taxable | 102 |
year. | 103 |
(b) Deduct, to the extent not otherwise deducted or excluded | 104 |
in computing federal or Ohio adjusted gross income during the | 105 |
taxable year, the amount the taxpayer paid during the taxable | 106 |
year, not compensated for by any insurance or otherwise, for | 107 |
medical care of the taxpayer, the taxpayer's spouse, and | 108 |
dependents, to the extent the expenses exceed seven and one-half | 109 |
per cent of the taxpayer's federal adjusted gross income. | 110 |
(c) For purposes of division (A)(11) of this section, | 111 |
"medical care" has the meaning given in section 213 of the | 112 |
Internal Revenue Code, subject to the special rules, limitations, | 113 |
and exclusions set forth therein, and "qualified long-term care" | 114 |
has the same meaning given in section 7702B(c) of the Internal | 115 |
Revenue Code. | 116 |
(12)(a) Deduct any amount included in federal adjusted gross | 117 |
income solely because the amount represents a reimbursement or | 118 |
refund of expenses that in any year the taxpayer had deducted as | 119 |
an itemized deduction pursuant to section 63 of the Internal | 120 |
Revenue Code and applicable United States department of the | 121 |
treasury regulations. The deduction otherwise allowed under | 122 |
division (A)(12)(a) of this section shall be reduced to the extent | 123 |
the reimbursement is attributable to an amount the taxpayer | 124 |
deducted under this section in any taxable year. | 125 |
(b) Add any amount not otherwise included in Ohio adjusted | 126 |
gross income for any taxable year to the extent that the amount is | 127 |
attributable to the recovery during the taxable year of any amount | 128 |
deducted or excluded in computing federal or Ohio adjusted gross | 129 |
income in any taxable year. | 130 |
(13) Deduct any portion of the deduction described in section | 131 |
1341(a)(2) of the Internal Revenue Code, for repaying previously | 132 |
reported income received under a claim of right, that meets both | 133 |
of the following requirements: | 134 |
(a) It is allowable for repayment of an item that was | 135 |
included in the taxpayer's adjusted gross income for a prior | 136 |
taxable year and did not qualify for a credit under division (A) | 137 |
or (B) of section 5747.05 of the Revised Code for that year; | 138 |
(b) It does not otherwise reduce the taxpayer's adjusted | 139 |
gross income for the current or any other taxable year. | 140 |
(14) Deduct an amount equal to the deposits made to, and net | 141 |
investment earnings of, a medical savings account during the | 142 |
taxable year, in accordance with section 3924.66 of the Revised | 143 |
Code. The deduction allowed by division (A)(14) of this section | 144 |
does not apply to medical savings account deposits and earnings | 145 |
otherwise deducted or excluded for the current or any other | 146 |
taxable year from the taxpayer's federal adjusted gross income. | 147 |
(15)(a) Add an amount equal to the funds withdrawn from a | 148 |
medical savings account during the taxable year, and the net | 149 |
investment earnings on those funds, when the funds withdrawn were | 150 |
used for any purpose other than to reimburse an account holder | 151 |
for, or to pay, eligible medical expenses, in accordance with | 152 |
section 3924.66 of the Revised Code; | 153 |
(b) Add the amounts distributed from a medical savings | 154 |
account under division (A)(2) of section 3924.68 of the Revised | 155 |
Code during the taxable year. | 156 |
(16) Add any amount claimed as a credit under section | 157 |
5747.059 of the Revised Code to the extent that such amount | 158 |
satisfies either of the following: | 159 |
(a) The amount was deducted or excluded from the computation | 160 |
of the taxpayer's federal adjusted gross income as required to be | 161 |
reported for the taxpayer's taxable year under the Internal | 162 |
Revenue Code; | 163 |
(b) The amount resulted in a reduction of the taxpayer's | 164 |
federal adjusted gross income as required to be reported for any | 165 |
of the taxpayer's taxable years under the Internal Revenue Code. | 166 |
(17) Deduct the amount contributed by the taxpayer to an | 167 |
individual development account program established by a county | 168 |
department of job and family services pursuant to sections 329.11 | 169 |
to 329.14 of the Revised Code for the purpose of matching funds | 170 |
deposited by program participants. On request of the tax | 171 |
commissioner, the taxpayer shall provide any information that, in | 172 |
the tax commissioner's opinion, is necessary to establish the | 173 |
amount deducted under division (A)(17) of this section. | 174 |
(18) Beginning in taxable year 2001 but not for any taxable | 175 |
year beginning after December 31, 2005, if the taxpayer is married | 176 |
and files a joint return and the combined federal adjusted gross | 177 |
income of the taxpayer and the taxpayer's spouse for the taxable | 178 |
year does not exceed one hundred thousand dollars, or if the | 179 |
taxpayer is single and has a federal adjusted gross income for the | 180 |
taxable year not exceeding fifty thousand dollars, deduct amounts | 181 |
paid during the taxable year for qualified tuition and fees paid | 182 |
to an eligible institution for the taxpayer, the taxpayer's | 183 |
spouse, or any dependent of the taxpayer, who is a resident of | 184 |
this state and is enrolled in or attending a program that | 185 |
culminates in a degree or diploma at an eligible institution. The | 186 |
deduction may be claimed only to the extent that qualified tuition | 187 |
and fees are not otherwise deducted or excluded for any taxable | 188 |
year from federal or Ohio adjusted gross income. The deduction may | 189 |
not be claimed for educational expenses for which the taxpayer | 190 |
claims a credit under section 5747.27 of the Revised Code. | 191 |
(19) Add any reimbursement received during the taxable year | 192 |
of any amount the taxpayer deducted under division (A)(18) of this | 193 |
section in any previous taxable year to the extent the amount is | 194 |
not otherwise included in Ohio adjusted gross income. | 195 |
(20)(a)(i) Add five-sixths of the amount of depreciation | 196 |
expense allowed by subsection (k) of section 168 of the Internal | 197 |
Revenue Code, including the taxpayer's proportionate or | 198 |
distributive share of the amount of depreciation expense allowed | 199 |
by that subsection to a pass-through entity in which the taxpayer | 200 |
has a direct or indirect ownership interest. | 201 |
(ii) Add five-sixths of the amount of qualifying section 179 | 202 |
depreciation expense, including a person's proportionate or | 203 |
distributive share of the amount of qualifying section 179 | 204 |
depreciation expense allowed to any pass-through entity in which | 205 |
the person has a direct or indirect ownership. For the purposes of | 206 |
this division, "qualifying section 179 depreciation expense" means | 207 |
the difference between (I) the amount of depreciation expense | 208 |
directly or indirectly allowed to the taxpayer under section 179 | 209 |
of the Internal Revenue Code, and (II) the amount of depreciation | 210 |
expense directly or indirectly allowed to the taxpayer under | 211 |
section 179 of the Internal Revenue Code as that section existed | 212 |
on December 31, 2002. | 213 |
The tax commissioner, under procedures established by the | 214 |
commissioner, may waive the add-backs related to a pass-through | 215 |
entity if the taxpayer owns, directly or indirectly, less than | 216 |
five per cent of the pass-through entity. | 217 |
(b) Nothing in division (A)(20) of this section shall be | 218 |
construed to adjust or modify the adjusted basis of any asset. | 219 |
(c) To the extent the add-back required under division | 220 |
(A)(20)(a) of this section is attributable to property generating | 221 |
nonbusiness income or loss allocated under section 5747.20 of the | 222 |
Revised Code, the add-back shall be sitused to the same location | 223 |
as the nonbusiness income or loss generated by the property for | 224 |
the purpose of determining the credit under division (A) of | 225 |
section 5747.05 of the Revised Code. Otherwise, the add-back shall | 226 |
be apportioned, subject to one or more of the four alternative | 227 |
methods of apportionment enumerated in section 5747.21 of the | 228 |
Revised Code. | 229 |
(d) For the purposes of division (A) of this section, net | 230 |
operating loss carryback and carryforward shall not include | 231 |
five-sixths of the allowance of any net operating loss deduction | 232 |
carryback or carryforward to the taxable year to the extent such | 233 |
loss resulted from depreciation allowed by section 168(k) of the | 234 |
Internal Revenue Code and by the qualifying section 179 | 235 |
depreciation expense amount. | 236 |
(21)(a) If the taxpayer was required to add an amount under | 237 |
division (A)(20)(a) of this section for a taxable year, deduct | 238 |
one-fifth of the amount so added for each of the five succeeding | 239 |
taxable years. | 240 |
(b) If the amount deducted under division (A)(21)(a) of this | 241 |
section is attributable to an add-back allocated under division | 242 |
(A)(20)(c) of this section, the amount deducted shall be sitused | 243 |
to the same location. Otherwise, the add-back shall be apportioned | 244 |
using the apportionment factors for the taxable year in which the | 245 |
deduction is taken, subject to one or more of the four alternative | 246 |
methods of apportionment enumerated in section 5747.21 of the | 247 |
Revised Code. | 248 |
(c) No deduction is available under division (A)(21)(a) of | 249 |
this section with regard to any depreciation allowed by section | 250 |
168(k) of the Internal Revenue Code and by the qualifying section | 251 |
179 depreciation expense amount to the extent that such | 252 |
depreciation resulted in or increased a federal net operating loss | 253 |
carryback or carryforward to a taxable year to which division | 254 |
(A)(20)(d) of this section does not apply. | 255 |
(22) Deduct, to the extent not otherwise deducted or excluded | 256 |
in computing federal or Ohio adjusted gross income for the taxable | 257 |
year, the amount the taxpayer received during the taxable year as | 258 |
reimbursement for life insurance premiums under section 5919.31 of | 259 |
the Revised Code. | 260 |
(23) Deduct, to the extent not otherwise deducted or excluded | 261 |
in computing federal or Ohio adjusted gross income for the taxable | 262 |
year, the amount the taxpayer received during the taxable year as | 263 |
a death benefit paid by the adjutant general under section 5919.33 | 264 |
of the Revised Code. | 265 |
(24) Deduct, to the extent included in federal adjusted gross | 266 |
income and not otherwise allowable as a deduction or exclusion in | 267 |
computing federal or Ohio adjusted gross income for the taxable | 268 |
year, military pay and allowances received by the taxpayer during | 269 |
the taxable year for active duty service in the United States | 270 |
army, air force, navy, marine corps, or coast guard or reserve | 271 |
components thereof or the national guard. The deduction may not be | 272 |
claimed for military pay and allowances received by the taxpayer | 273 |
while the taxpayer is stationed in this state. | 274 |
(25) Deduct, to the extent not otherwise allowable as a | 275 |
deduction or exclusion in computing federal or Ohio adjusted gross | 276 |
income for the taxable year and not otherwise compensated for by | 277 |
any other source, the amount of qualified organ donation expenses | 278 |
incurred by the taxpayer during the taxable year, not to exceed | 279 |
ten thousand dollars. A taxpayer may deduct qualified organ | 280 |
donation expenses only once for all taxable years beginning with | 281 |
taxable years beginning in 2007. | 282 |
For the purposes of division (A)(25) of this section: | 283 |
(a) "Human organ" means all or any portion of a human liver, | 284 |
pancreas, kidney, intestine, or lung, and any portion of human | 285 |
bone marrow. | 286 |
(b) "Qualified organ donation expenses" means travel | 287 |
expenses, lodging expenses, and wages and salary forgone by a | 288 |
taxpayer in connection with the taxpayer's donation, while living, | 289 |
of one or more of the taxpayer's human organs to another human | 290 |
being. | 291 |
(26) Deduct, to the extent not otherwise deducted or excluded | 292 |
in computing federal or Ohio adjusted gross income for the taxable | 293 |
year, amounts received by the taxpayer as retired military | 294 |
personnel pay for service in the United States army, navy, air | 295 |
force, coast guard, or marine corps or reserve components thereof, | 296 |
or the national guard, or received by the surviving spouse or | 297 |
former spouse of such a taxpayer under the survivor benefit plan | 298 |
on account of such a taxpayer's death. If the taxpayer receives | 299 |
income on account of retirement paid under the federal civil | 300 |
service retirement system or federal employees retirement system, | 301 |
or under any successor retirement program enacted by the congress | 302 |
of the United States that is established and maintained for | 303 |
retired employees of the United States government, and such | 304 |
retirement income is based, in whole or in part, on credit for | 305 |
the taxpayer's military service, the deduction allowed under this | 306 |
division shall include only that portion of such retirement | 307 |
income that is attributable to the taxpayer's military service, | 308 |
to the extent that portion of such retirement income is otherwise | 309 |
included in federal adjusted gross income and is not otherwise | 310 |
deducted under this section. Any amount deducted under division | 311 |
(A)(26) of this section is not included in a taxpayer's | 312 |
adjusted gross income for the purposes of section 5747.055 of | 313 |
the Revised Code. No amount may be deducted under division | 314 |
(A)(26) of this section on the basis of which a credit was | 315 |
claimed under section 5747.055 of the Revised Code. | 316 |
(27) Deduct, to the extent not otherwise deducted or excluded | 317 |
in computing federal or Ohio adjusted gross income for the taxable | 318 |
year, the amount the taxpayer received during the taxable year | 319 |
from the military injury relief fund created in section 5101.98 of | 320 |
the Revised Code. | 321 |
(28) For the taxpayer's taxable year beginning in 2009, add | 322 |
any amount excluded from federal adjusted gross income pursuant to | 323 |
section 85(c) of the Internal Revenue Code. | 324 |
(29) Add any amount by which federal adjusted gross income is | 325 |
reduced because of an election under section 172(b)(1)(H) of the | 326 |
Internal Revenue Code as amended by the "American Recovery and | 327 |
Reinvestment Act of 2009," 123 Stat. 115. | 328 |
(30)(a) Add any amount not included in federal adjusted | 329 |
gross income for the taxable year because of an election under | 330 |
section 108(i) of the Internal Revenue Code. | 331 |
(b) Deduct any amount included in federal adjusted gross | 332 |
income for the taxable year because of an election under section | 333 |
108(i) of the Internal Revenue Code. | 334 |
(B) "Business income" means income, including gain or loss, | 335 |
arising from transactions, activities, and sources in the regular | 336 |
course of a trade or business and includes income, gain, or loss | 337 |
from real property, tangible property, and intangible property if | 338 |
the acquisition, rental, management, and disposition of the | 339 |
property constitute integral parts of the regular course of a | 340 |
trade or business operation. "Business income" includes income, | 341 |
including gain or loss, from a partial or complete liquidation of | 342 |
a business, including, but not limited to, gain or loss from the | 343 |
sale or other disposition of goodwill. | 344 |
(C) "Nonbusiness income" means all income other than business | 345 |
income and may include, but is not limited to, compensation, rents | 346 |
and royalties from real or tangible personal property, capital | 347 |
gains, interest, dividends and distributions, patent or copyright | 348 |
royalties, or lottery winnings, prizes, and awards. | 349 |
(D) "Compensation" means any form of remuneration paid to an | 350 |
employee for personal services. | 351 |
(E) "Fiduciary" means a guardian, trustee, executor, | 352 |
administrator, receiver, conservator, or any other person acting | 353 |
in any fiduciary capacity for any individual, trust, or estate. | 354 |
(F) "Fiscal year" means an accounting period of twelve months | 355 |
ending on the last day of any month other than December. | 356 |
(G) "Individual" means any natural person. | 357 |
(H) "Internal Revenue Code" means the "Internal Revenue Code | 358 |
of 1986," 100 Stat. 2085, 26 U.S.C.A. 1, as amended. | 359 |
(I) "Resident" means any of the following, provided that | 360 |
division (I)(3) of this section applies only to taxable years of a | 361 |
trust beginning in 2002 or thereafter: | 362 |
(1) An individual who is domiciled in this state, subject to | 363 |
section 5747.24 of the Revised Code; | 364 |
(2) The estate of a decedent who at the time of death was | 365 |
domiciled in this state. The domicile tests of section 5747.24 of | 366 |
the Revised Code are not controlling for purposes of division | 367 |
(I)(2) of this section. | 368 |
(3) A trust that, in whole or part, resides in this state. If | 369 |
only part of a trust resides in this state, the trust is a | 370 |
resident only with respect to that part. | 371 |
For the purposes of division (I)(3) of this section: | 372 |
(a) A trust resides in this state for the trust's current | 373 |
taxable year to the extent, as described in division (I)(3)(d) of | 374 |
this section, that the trust consists directly or indirectly, in | 375 |
whole or in part, of assets, net of any related liabilities, that | 376 |
were transferred, or caused to be transferred, directly or | 377 |
indirectly, to the trust by any of the following: | 378 |
(i) A person, a court, or a governmental entity or | 379 |
instrumentality on account of the death of a decedent, but only if | 380 |
the trust is described in division (I)(3)(e)(i) or (ii) of this | 381 |
section; | 382 |
(ii) A person who was domiciled in this state for the | 383 |
purposes of this chapter when the person directly or indirectly | 384 |
transferred assets to an irrevocable trust, but only if at least | 385 |
one of the trust's qualifying beneficiaries is domiciled in this | 386 |
state for the purposes of this chapter during all or some portion | 387 |
of the trust's current taxable year; | 388 |
(iii) A person who was domiciled in this state for the | 389 |
purposes of this chapter when the trust document or instrument or | 390 |
part of the trust document or instrument became irrevocable, but | 391 |
only if at least one of the trust's qualifying beneficiaries is a | 392 |
resident domiciled in this state for the purposes of this chapter | 393 |
during all or some portion of the trust's current taxable year. If | 394 |
a trust document or instrument became irrevocable upon the death | 395 |
of a person who at the time of death was domiciled in this state | 396 |
for purposes of this chapter, that person is a person described in | 397 |
division (I)(3)(a)(iii) of this section. | 398 |
(b) A trust is irrevocable to the extent that the transferor | 399 |
is not considered to be the owner of the net assets of the trust | 400 |
under sections 671 to 678 of the Internal Revenue Code. | 401 |
(c) With respect to a trust other than a charitable lead | 402 |
trust, "qualifying beneficiary" has the same meaning as "potential | 403 |
current beneficiary" as defined in section 1361(e)(2) of the | 404 |
Internal Revenue Code, and with respect to a charitable lead trust | 405 |
"qualifying beneficiary" is any current, future, or contingent | 406 |
beneficiary, but with respect to any trust "qualifying | 407 |
beneficiary" excludes a person or a governmental entity or | 408 |
instrumentality to any of which a contribution would qualify for | 409 |
the charitable deduction under section 170 of the Internal Revenue | 410 |
Code. | 411 |
(d) For the purposes of division (I)(3)(a) of this section, | 412 |
the extent to which a trust consists directly or indirectly, in | 413 |
whole or in part, of assets, net of any related liabilities, that | 414 |
were transferred directly or indirectly, in whole or part, to the | 415 |
trust by any of the sources enumerated in that division shall be | 416 |
ascertained by multiplying the fair market value of the trust's | 417 |
assets, net of related liabilities, by the qualifying ratio, which | 418 |
shall be computed as follows: | 419 |
(i) The first time the trust receives assets, the numerator | 420 |
of the qualifying ratio is the fair market value of those assets | 421 |
at that time, net of any related liabilities, from sources | 422 |
enumerated in division (I)(3)(a) of this section. The denominator | 423 |
of the qualifying ratio is the fair market value of all the | 424 |
trust's assets at that time, net of any related liabilities. | 425 |
(ii) Each subsequent time the trust receives assets, a | 426 |
revised qualifying ratio shall be computed. The numerator of the | 427 |
revised qualifying ratio is the sum of (1) the fair market value | 428 |
of the trust's assets immediately prior to the subsequent | 429 |
transfer, net of any related liabilities, multiplied by the | 430 |
qualifying ratio last computed without regard to the subsequent | 431 |
transfer, and (2) the fair market value of the subsequently | 432 |
transferred assets at the time transferred, net of any related | 433 |
liabilities, from sources enumerated in division (I)(3)(a) of this | 434 |
section. The denominator of the revised qualifying ratio is the | 435 |
fair market value of all the trust's assets immediately after the | 436 |
subsequent transfer, net of any related liabilities. | 437 |
(iii) Whether a transfer to the trust is by or from any of | 438 |
the sources enumerated in division (I)(3)(a) of this section shall | 439 |
be ascertained without regard to the domicile of the trust's | 440 |
beneficiaries. | 441 |
(e) For the purposes of division (I)(3)(a)(i) of this | 442 |
section: | 443 |
(i) A trust is described in division (I)(3)(e)(i) of this | 444 |
section if the trust is a testamentary trust and the testator of | 445 |
that testamentary trust was domiciled in this state at the time of | 446 |
the testator's death for purposes of the taxes levied under | 447 |
Chapter 5731. of the Revised Code. | 448 |
(ii) A trust is described in division (I)(3)(e)(ii) of this | 449 |
section if the transfer is a qualifying transfer described in any | 450 |
of divisions (I)(3)(f)(i) to (vi) of this section, the trust is an | 451 |
irrevocable inter vivos trust, and at least one of the trust's | 452 |
qualifying beneficiaries is domiciled in this state for purposes | 453 |
of this chapter during all or some portion of the trust's current | 454 |
taxable year. | 455 |
(f) For the purposes of division (I)(3)(e)(ii) of this | 456 |
section, a "qualifying transfer" is a transfer of assets, net of | 457 |
any related liabilities, directly or indirectly to a trust, if the | 458 |
transfer is described in any of the following: | 459 |
(i) The transfer is made to a trust, created by the decedent | 460 |
before the decedent's death and while the decedent was domiciled | 461 |
in this state for the purposes of this chapter, and, prior to the | 462 |
death of the decedent, the trust became irrevocable while the | 463 |
decedent was domiciled in this state for the purposes of this | 464 |
chapter. | 465 |
(ii) The transfer is made to a trust to which the decedent, | 466 |
prior to the decedent's death, had directly or indirectly | 467 |
transferred assets, net of any related liabilities, while the | 468 |
decedent was domiciled in this state for the purposes of this | 469 |
chapter, and prior to the death of the decedent the trust became | 470 |
irrevocable while the decedent was domiciled in this state for the | 471 |
purposes of this chapter. | 472 |
(iii) The transfer is made on account of a contractual | 473 |
relationship existing directly or indirectly between the | 474 |
transferor and either the decedent or the estate of the decedent | 475 |
at any time prior to the date of the decedent's death, and the | 476 |
decedent was domiciled in this state at the time of death for | 477 |
purposes of the taxes levied under Chapter 5731. of the Revised | 478 |
Code. | 479 |
(iv) The transfer is made to a trust on account of a | 480 |
contractual relationship existing directly or indirectly between | 481 |
the transferor and another person who at the time of the | 482 |
decedent's death was domiciled in this state for purposes of this | 483 |
chapter. | 484 |
(v) The transfer is made to a trust on account of the will of | 485 |
a testator. | 486 |
(vi) The transfer is made to a trust created by or caused to | 487 |
be created by a court, and the trust was directly or indirectly | 488 |
created in connection with or as a result of the death of an | 489 |
individual who, for purposes of the taxes levied under Chapter | 490 |
5731. of the Revised Code, was domiciled in this state at the time | 491 |
of the individual's death. | 492 |
(g) The tax commissioner may adopt rules to ascertain the | 493 |
part of a trust residing in this state. | 494 |
(J) "Nonresident" means an individual or estate that is not a | 495 |
resident. An individual who is a resident for only part of a | 496 |
taxable year is a nonresident for the remainder of that taxable | 497 |
year. | 498 |
(K) "Pass-through entity" has the same meaning as in section | 499 |
5733.04 of the Revised Code. | 500 |
(L) "Return" means the notifications and reports required to | 501 |
be filed pursuant to this chapter for the purpose of reporting the | 502 |
tax due and includes declarations of estimated tax when so | 503 |
required. | 504 |
(M) "Taxable year" means the calendar year or the taxpayer's | 505 |
fiscal year ending during the calendar year, or fractional part | 506 |
thereof, upon which the adjusted gross income is calculated | 507 |
pursuant to this chapter. | 508 |
(N) "Taxpayer" means any person subject to the tax imposed by | 509 |
section 5747.02 of the Revised Code or any pass-through entity | 510 |
that makes the election under division (D) of section 5747.08 of | 511 |
the Revised Code. | 512 |
(O) "Dependents" means dependents as defined in the Internal | 513 |
Revenue Code and as claimed in the taxpayer's federal income tax | 514 |
return for the taxable year or which the taxpayer would have been | 515 |
permitted to claim had the taxpayer filed a federal income tax | 516 |
return. | 517 |
(P) "Principal county of employment" means, in the case of a | 518 |
nonresident, the county within the state in which a taxpayer | 519 |
performs services for an employer or, if those services are | 520 |
performed in more than one county, the county in which the major | 521 |
portion of the services are performed. | 522 |
(Q) As used in sections 5747.50 to 5747.55 of the Revised | 523 |
Code: | 524 |
(1) "Subdivision" means any county, municipal corporation, | 525 |
park district, or township. | 526 |
(2) "Essential local government purposes" includes all | 527 |
functions that any subdivision is required by general law to | 528 |
exercise, including like functions that are exercised under a | 529 |
charter adopted pursuant to the Ohio Constitution. | 530 |
(R) "Overpayment" means any amount already paid that exceeds | 531 |
the figure determined to be the correct amount of the tax. | 532 |
(S) "Taxable income" or "Ohio taxable income" applies only to | 533 |
estates and trusts, and means federal taxable income, as defined | 534 |
and used in the Internal Revenue Code, adjusted as follows: | 535 |
(1) Add interest or dividends, net of ordinary, necessary, | 536 |
and reasonable expenses not deducted in computing federal taxable | 537 |
income, on obligations or securities of any state or of any | 538 |
political subdivision or authority of any state, other than this | 539 |
state and its subdivisions and authorities, but only to the extent | 540 |
that such net amount is not otherwise includible in Ohio taxable | 541 |
income and is described in either division (S)(1)(a) or (b) of | 542 |
this section: | 543 |
(a) The net amount is not attributable to the S portion of an | 544 |
electing small business trust and has not been distributed to | 545 |
beneficiaries for the taxable year; | 546 |
(b) The net amount is attributable to the S portion of an | 547 |
electing small business trust for the taxable year. | 548 |
(2) Add interest or dividends, net of ordinary, necessary, | 549 |
and reasonable expenses not deducted in computing federal taxable | 550 |
income, on obligations of any authority, commission, | 551 |
instrumentality, territory, or possession of the United States to | 552 |
the extent that the interest or dividends are exempt from federal | 553 |
income taxes but not from state income taxes, but only to the | 554 |
extent that such net amount is not otherwise includible in Ohio | 555 |
taxable income and is described in either division (S)(1)(a) or | 556 |
(b) of this section; | 557 |
(3) Add the amount of personal exemption allowed to the | 558 |
estate pursuant to section 642(b) of the Internal Revenue Code; | 559 |
(4) Deduct interest or dividends, net of related expenses | 560 |
deducted in computing federal taxable income, on obligations of | 561 |
the United States and its territories and possessions or of any | 562 |
authority, commission, or instrumentality of the United States to | 563 |
the extent that the interest or dividends are exempt from state | 564 |
taxes under the laws of the United States, but only to the extent | 565 |
that such amount is included in federal taxable income and is | 566 |
described in either division (S)(1)(a) or (b) of this section; | 567 |
(5) Deduct the amount of wages and salaries, if any, not | 568 |
otherwise allowable as a deduction but that would have been | 569 |
allowable as a deduction in computing federal taxable income for | 570 |
the taxable year, had the targeted jobs credit allowed under | 571 |
sections 38, 51, and 52 of the Internal Revenue Code not been in | 572 |
effect, but only to the extent such amount relates either to | 573 |
income included in federal taxable income for the taxable year or | 574 |
to income of the S portion of an electing small business trust for | 575 |
the taxable year; | 576 |
(6) Deduct any interest or interest equivalent, net of | 577 |
related expenses deducted in computing federal taxable income, on | 578 |
public obligations and purchase obligations, but only to the | 579 |
extent that such net amount relates either to income included in | 580 |
federal taxable income for the taxable year or to income of the S | 581 |
portion of an electing small business trust for the taxable year; | 582 |
(7) Add any loss or deduct any gain resulting from sale, | 583 |
exchange, or other disposition of public obligations to the extent | 584 |
that such loss has been deducted or such gain has been included in | 585 |
computing either federal taxable income or income of the S portion | 586 |
of an electing small business trust for the taxable year; | 587 |
(8) Except in the case of the final return of an estate, add | 588 |
any amount deducted by the taxpayer on both its Ohio estate tax | 589 |
return pursuant to section 5731.14 of the Revised Code, and on its | 590 |
federal income tax return in determining federal taxable income; | 591 |
(9)(a) Deduct any amount included in federal taxable income | 592 |
solely because the amount represents a reimbursement or refund of | 593 |
expenses that in a previous year the decedent had deducted as an | 594 |
itemized deduction pursuant to section 63 of the Internal Revenue | 595 |
Code and applicable treasury regulations. The deduction otherwise | 596 |
allowed under division (S)(9)(a) of this section shall be reduced | 597 |
to the extent the reimbursement is attributable to an amount the | 598 |
taxpayer or decedent deducted under this section in any taxable | 599 |
year. | 600 |
(b) Add any amount not otherwise included in Ohio taxable | 601 |
income for any taxable year to the extent that the amount is | 602 |
attributable to the recovery during the taxable year of any amount | 603 |
deducted or excluded in computing federal or Ohio taxable income | 604 |
in any taxable year, but only to the extent such amount has not | 605 |
been distributed to beneficiaries for the taxable year. | 606 |
(10) Deduct any portion of the deduction described in section | 607 |
1341(a)(2) of the Internal Revenue Code, for repaying previously | 608 |
reported income received under a claim of right, that meets both | 609 |
of the following requirements: | 610 |
(a) It is allowable for repayment of an item that was | 611 |
included in the taxpayer's taxable income or the decedent's | 612 |
adjusted gross income for a prior taxable year and did not qualify | 613 |
for a credit under division (A) or (B) of section 5747.05 of the | 614 |
Revised Code for that year. | 615 |
(b) It does not otherwise reduce the taxpayer's taxable | 616 |
income or the decedent's adjusted gross income for the current or | 617 |
any other taxable year. | 618 |
(11) Add any amount claimed as a credit under section | 619 |
5747.059 of the Revised Code to the extent that the amount | 620 |
satisfies either of the following: | 621 |
(a) The amount was deducted or excluded from the computation | 622 |
of the taxpayer's federal taxable income as required to be | 623 |
reported for the taxpayer's taxable year under the Internal | 624 |
Revenue Code; | 625 |
(b) The amount resulted in a reduction in the taxpayer's | 626 |
federal taxable income as required to be reported for any of the | 627 |
taxpayer's taxable years under the Internal Revenue Code. | 628 |
(12) Deduct any amount, net of related expenses deducted in | 629 |
computing federal taxable income, that a trust is required to | 630 |
report as farm income on its federal income tax return, but only | 631 |
if the assets of the trust include at least ten acres of land | 632 |
satisfying the definition of "land devoted exclusively to | 633 |
agricultural use" under section 5713.30 of the Revised Code, | 634 |
regardless of whether the land is valued for tax purposes as such | 635 |
land under sections 5713.30 to 5713.38 of the Revised Code. If the | 636 |
trust is a pass-through entity investor, section 5747.231 of the | 637 |
Revised Code applies in ascertaining if the trust is eligible to | 638 |
claim the deduction provided by division (S)(12) of this section | 639 |
in connection with the pass-through entity's farm income. | 640 |
Except for farm income attributable to the S portion of an | 641 |
electing small business trust, the deduction provided by division | 642 |
(S)(12) of this section is allowed only to the extent that the | 643 |
trust has not distributed such farm income. Division (S)(12) of | 644 |
this section applies only to taxable years of a trust beginning in | 645 |
2002 or thereafter. | 646 |
(13) Add the net amount of income described in section 641(c) | 647 |
of the Internal Revenue Code to the extent that amount is not | 648 |
included in federal taxable income. | 649 |
(14) Add or deduct the amount the taxpayer would be required | 650 |
to add or deduct under division (A)(20) or (21) of this section if | 651 |
the taxpayer's Ohio taxable income were computed in the same | 652 |
manner as an individual's Ohio adjusted gross income is computed | 653 |
under this section. In the case of a trust, division (S)(14) of | 654 |
this section applies only to any of the trust's taxable years | 655 |
beginning in 2002 or thereafter. | 656 |
(15) Add any amount by which federal taxable income is | 657 |
reduced because of an election under section 172(b)(1)(H) of the | 658 |
Internal Revenue Code as amended by the "American Recovery and | 659 |
Reinvestment Act of 2009," 123 Stat. 115. | 660 |
(16)(a) Add any amount not included in federal taxable income | 661 |
for the taxable year because of an election under section 108(i) | 662 |
of the Internal Revenue Code. | 663 |
(b) Deduct any amount included in federal taxable income for | 664 |
the taxable year because of an election under section 108(i) of | 665 |
the Internal Revenue Code. | 666 |
(T) "School district income" and "school district income tax" | 667 |
have the same meanings as in section 5748.01 of the Revised Code. | 668 |
(U) As used in divisions (A)(8), (A)(9), (S)(6), and (S)(7) | 669 |
of this section, "public obligations," "purchase obligations," and | 670 |
"interest or interest equivalent" have the same meanings as in | 671 |
section 5709.76 of the Revised Code. | 672 |
(V) "Limited liability company" means any limited liability | 673 |
company formed under Chapter 1705. of the Revised Code or under | 674 |
the laws of any other state. | 675 |
(W) "Pass-through entity investor" means any person who, | 676 |
during any portion of a taxable year of a pass-through entity, is | 677 |
a partner, member, shareholder, or equity investor in that | 678 |
pass-through entity. | 679 |
(X) "Banking day" has the same meaning as in section 1304.01 | 680 |
of the Revised Code. | 681 |
(Y) "Month" means a calendar month. | 682 |
(Z) "Quarter" means the first three months, the second three | 683 |
months, the third three months, or the last three months of the | 684 |
taxpayer's taxable year. | 685 |
(AA)(1) "Eligible institution" means a state university or | 686 |
state institution of higher education as defined in section | 687 |
3345.011 of the Revised Code, or a private, nonprofit college, | 688 |
university, or other post-secondary institution located in this | 689 |
state that possesses a certificate of authorization issued by the | 690 |
Ohio board of regents pursuant to Chapter 1713. of the Revised | 691 |
Code or a certificate of registration issued by the state board of | 692 |
career colleges and schools under Chapter 3332. of the Revised | 693 |
Code. | 694 |
(2) "Qualified tuition and fees" means tuition and fees | 695 |
imposed by an eligible institution as a condition of enrollment or | 696 |
attendance, not exceeding two thousand five hundred dollars in | 697 |
each of the individual's first two years of post-secondary | 698 |
education. If the individual is a part-time student, "qualified | 699 |
tuition and fees" includes tuition and fees paid for the academic | 700 |
equivalent of the first two years of post-secondary education | 701 |
during a maximum of five taxable years, not exceeding a total of | 702 |
five thousand dollars. "Qualified tuition and fees" does not | 703 |
include: | 704 |
(a) Expenses for any course or activity involving sports, | 705 |
games, or hobbies unless the course or activity is part of the | 706 |
individual's degree or diploma program; | 707 |
(b) The cost of books, room and board, student activity fees, | 708 |
athletic fees, insurance expenses, or other expenses unrelated to | 709 |
the individual's academic course of instruction; | 710 |
(c) Tuition, fees, or other expenses paid or reimbursed | 711 |
through an employer, scholarship, grant in aid, or other | 712 |
educational benefit program. | 713 |
(BB)(1) "Modified business income" means the business income | 714 |
included in a trust's Ohio taxable income after such taxable | 715 |
income is first reduced by the qualifying trust amount, if any. | 716 |
(2) "Qualifying trust amount" of a trust means capital gains | 717 |
and losses from the sale, exchange, or other disposition of equity | 718 |
or ownership interests in, or debt obligations of, a qualifying | 719 |
investee to the extent included in the trust's Ohio taxable | 720 |
income, but only if the following requirements are satisfied: | 721 |
(a) The book value of the qualifying investee's physical | 722 |
assets in this state and everywhere, as of the last day of the | 723 |
qualifying investee's fiscal or calendar year ending immediately | 724 |
prior to the date on which the trust recognizes the gain or loss, | 725 |
is available to the trust. | 726 |
(b) The requirements of section 5747.011 of the Revised Code | 727 |
are satisfied for the trust's taxable year in which the trust | 728 |
recognizes the gain or loss. | 729 |
Any gain or loss that is not a qualifying trust amount is | 730 |
modified business income, qualifying investment income, or | 731 |
modified nonbusiness income, as the case may be. | 732 |
(3) "Modified nonbusiness income" means a trust's Ohio | 733 |
taxable income other than modified business income, other than the | 734 |
qualifying trust amount, and other than qualifying investment | 735 |
income, as defined in section 5747.012 of the Revised Code, to the | 736 |
extent such qualifying investment income is not otherwise part of | 737 |
modified business income. | 738 |
(4) "Modified Ohio taxable income" applies only to trusts, | 739 |
and means the sum of the amounts described in divisions (BB)(4)(a) | 740 |
to (c) of this section: | 741 |
(a) The fraction, calculated under section 5747.013, and | 742 |
applying section 5747.231 of the Revised Code, multiplied by the | 743 |
sum of the following amounts: | 744 |
(i) The trust's modified business income; | 745 |
(ii) The trust's qualifying investment income, as defined in | 746 |
section 5747.012 of the Revised Code, but only to the extent the | 747 |
qualifying investment income does not otherwise constitute | 748 |
modified business income and does not otherwise constitute a | 749 |
qualifying trust amount. | 750 |
(b) The qualifying trust amount multiplied by a fraction, the | 751 |
numerator of which is the sum of the book value of the qualifying | 752 |
investee's physical assets in this state on the last day of the | 753 |
qualifying investee's fiscal or calendar year ending immediately | 754 |
prior to the day on which the trust recognizes the qualifying | 755 |
trust amount, and the denominator of which is the sum of the book | 756 |
value of the qualifying investee's total physical assets | 757 |
everywhere on the last day of the qualifying investee's fiscal or | 758 |
calendar year ending immediately prior to the day on which the | 759 |
trust recognizes the qualifying trust amount. If, for a taxable | 760 |
year, the trust recognizes a qualifying trust amount with respect | 761 |
to more than one qualifying investee, the amount described in | 762 |
division (BB)(4)(b) of this section shall equal the sum of the | 763 |
products so computed for each such qualifying investee. | 764 |
(c)(i) With respect to a trust or portion of a trust that is | 765 |
a resident as ascertained in accordance with division (I)(3)(d) of | 766 |
this section, its modified nonbusiness income. | 767 |
(ii) With respect to a trust or portion of a trust that is | 768 |
not a resident as ascertained in accordance with division | 769 |
(I)(3)(d) of this section, the amount of its modified nonbusiness | 770 |
income satisfying the descriptions in divisions (B)(2) to (5) of | 771 |
section 5747.20 of the Revised Code, except as otherwise provided | 772 |
in division (BB)(4)(c)(ii) of this section. With respect to a | 773 |
trust or portion of a trust that is not a resident as ascertained | 774 |
in accordance with division (I)(3)(d) of this section, the trust's | 775 |
portion of modified nonbusiness income recognized from the sale, | 776 |
exchange, or other disposition of a debt interest in or equity | 777 |
interest in a section 5747.212 entity, as defined in section | 778 |
5747.212 of the Revised Code, without regard to division (A) of | 779 |
that section, shall not be allocated to this state in accordance | 780 |
with section 5747.20 of the Revised Code but shall be apportioned | 781 |
to this state in accordance with division (B) of section 5747.212 | 782 |
of the Revised Code without regard to division (A) of that | 783 |
section. | 784 |
If the allocation and apportionment of a trust's income under | 785 |
divisions (BB)(4)(a) and (c) of this section do not fairly | 786 |
represent the modified Ohio taxable income of the trust in this | 787 |
state, the alternative methods described in division (C) of | 788 |
section 5747.21 of the Revised Code may be applied in the manner | 789 |
and to the same extent provided in that section. | 790 |
(5)(a) Except as set forth in division (BB)(5)(b) of this | 791 |
section, "qualifying investee" means a person in which a trust has | 792 |
an equity or ownership interest, or a person or unit of government | 793 |
the debt obligations of either of which are owned by a trust. For | 794 |
the purposes of division (BB)(2)(a) of this section and for the | 795 |
purpose of computing the fraction described in division (BB)(4)(b) | 796 |
of this section, all of the following apply: | 797 |
(i) If the qualifying investee is a member of a qualifying | 798 |
controlled group on the last day of the qualifying investee's | 799 |
fiscal or calendar year ending immediately prior to the date on | 800 |
which the trust recognizes the gain or loss, then "qualifying | 801 |
investee" includes all persons in the qualifying controlled group | 802 |
on such last day. | 803 |
(ii) If the qualifying investee, or if the qualifying | 804 |
investee and any members of the qualifying controlled group of | 805 |
which the qualifying investee is a member on the last day of the | 806 |
qualifying investee's fiscal or calendar year ending immediately | 807 |
prior to the date on which the trust recognizes the gain or loss, | 808 |
separately or cumulatively own, directly or indirectly, on the | 809 |
last day of the qualifying investee's fiscal or calendar year | 810 |
ending immediately prior to the date on which the trust recognizes | 811 |
the qualifying trust amount, more than fifty per cent of the | 812 |
equity of a pass-through entity, then the qualifying investee and | 813 |
the other members are deemed to own the proportionate share of the | 814 |
pass-through entity's physical assets which the pass-through | 815 |
entity directly or indirectly owns on the last day of the | 816 |
pass-through entity's calendar or fiscal year ending within or | 817 |
with the last day of the qualifying investee's fiscal or calendar | 818 |
year ending immediately prior to the date on which the trust | 819 |
recognizes the qualifying trust amount. | 820 |
(iii) For the purposes of division (BB)(5)(a)(iii) of this | 821 |
section, "upper level pass-through entity" means a pass-through | 822 |
entity directly or indirectly owning any equity of another | 823 |
pass-through entity, and "lower level pass-through entity" means | 824 |
that other pass-through entity. | 825 |
An upper level pass-through entity, whether or not it is also | 826 |
a qualifying investee, is deemed to own, on the last day of the | 827 |
upper level pass-through entity's calendar or fiscal year, the | 828 |
proportionate share of the lower level pass-through entity's | 829 |
physical assets that the lower level pass-through entity directly | 830 |
or indirectly owns on the last day of the lower level pass-through | 831 |
entity's calendar or fiscal year ending within or with the last | 832 |
day of the upper level pass-through entity's fiscal or calendar | 833 |
year. If the upper level pass-through entity directly and | 834 |
indirectly owns less than fifty per cent of the equity of the | 835 |
lower level pass-through entity on each day of the upper level | 836 |
pass-through entity's calendar or fiscal year in which or with | 837 |
which ends the calendar or fiscal year of the lower level | 838 |
pass-through entity and if, based upon clear and convincing | 839 |
evidence, complete information about the location and cost of the | 840 |
physical assets of the lower pass-through entity is not available | 841 |
to the upper level pass-through entity, then solely for purposes | 842 |
of ascertaining if a gain or loss constitutes a qualifying trust | 843 |
amount, the upper level pass-through entity shall be deemed as | 844 |
owning no equity of the lower level pass-through entity for each | 845 |
day during the upper level pass-through entity's calendar or | 846 |
fiscal year in which or with which ends the lower level | 847 |
pass-through entity's calendar or fiscal year. Nothing in division | 848 |
(BB)(5)(a)(iii) of this section shall be construed to provide for | 849 |
any deduction or exclusion in computing any trust's Ohio taxable | 850 |
income. | 851 |
(b) With respect to a trust that is not a resident for the | 852 |
taxable year and with respect to a part of a trust that is not a | 853 |
resident for the taxable year, "qualifying investee" for that | 854 |
taxable year does not include a C corporation if both of the | 855 |
following apply: | 856 |
(i) During the taxable year the trust or part of the trust | 857 |
recognizes a gain or loss from the sale, exchange, or other | 858 |
disposition of equity or ownership interests in, or debt | 859 |
obligations of, the C corporation. | 860 |
(ii) Such gain or loss constitutes nonbusiness income. | 861 |
(6) "Available" means information is such that a person is | 862 |
able to learn of the information by the due date plus extensions, | 863 |
if any, for filing the return for the taxable year in which the | 864 |
trust recognizes the gain or loss. | 865 |
(CC) "Qualifying controlled group" has the same meaning as in | 866 |
section 5733.04 of the Revised Code. | 867 |
(DD) "Related member" has the same meaning as in section | 868 |
5733.042 of the Revised Code. | 869 |
(EE)(1) For the purposes of division (EE) of this section: | 870 |
(a) "Qualifying person" means any person other than a | 871 |
qualifying corporation. | 872 |
(b) "Qualifying corporation" means any person classified for | 873 |
federal income tax purposes as an association taxable as a | 874 |
corporation, except either of the following: | 875 |
(i) A corporation that has made an election under subchapter | 876 |
S, chapter one, subtitle A, of the Internal Revenue Code for its | 877 |
taxable year ending within, or on the last day of, the investor's | 878 |
taxable year; | 879 |
(ii) A subsidiary that is wholly owned by any corporation | 880 |
that has made an election under subchapter S, chapter one, | 881 |
subtitle A of the Internal Revenue Code for its taxable year | 882 |
ending within, or on the last day of, the investor's taxable year. | 883 |
(2) For the purposes of this chapter, unless expressly stated | 884 |
otherwise, no qualifying person indirectly owns any asset directly | 885 |
or indirectly owned by any qualifying corporation. | 886 |
(FF) For purposes of this chapter and Chapter 5751. of the | 887 |
Revised Code: | 888 |
(1) "Trust" does not include a qualified pre-income tax | 889 |
trust. | 890 |
(2) A "qualified pre-income tax trust" is any pre-income tax | 891 |
trust that makes a qualifying pre-income tax trust election as | 892 |
described in division (FF)(3) of this section. | 893 |
(3) A "qualifying pre-income tax trust election" is an | 894 |
election by a pre-income tax trust to subject to the tax imposed | 895 |
by section 5751.02 of the Revised Code the pre-income tax trust | 896 |
and all pass-through entities of which the trust owns or | 897 |
controls, directly, indirectly, or constructively through related | 898 |
interests, five per cent or more of the ownership or equity | 899 |
interests. The trustee shall notify the tax commissioner in | 900 |
writing of the election on or before April 15, 2006. The | 901 |
election, if timely made, shall be effective on and after January | 902 |
1, 2006, and shall apply for all tax periods and tax years until | 903 |
revoked by the trustee of the trust. | 904 |
(4) A "pre-income tax trust" is a trust that satisfies all of | 905 |
the following requirements: | 906 |
(a) The document or instrument creating the trust was | 907 |
executed by the grantor before January 1, 1972; | 908 |
(b) The trust became irrevocable upon the creation of the | 909 |
trust; and | 910 |
(c) The grantor was domiciled in this state at the time the | 911 |
trust was created. | 912 |
Section 2. That existing section 5747.01 of the Revised Code | 913 |
is hereby repealed. | 914 |
Section 3. That the version of section 5747.01 of the Revised | 915 |
Code that is scheduled to take effect January 1, 2010, be amended | 916 |
to read as follows: | 917 |
Sec. 5747.01. Except as otherwise expressly provided or | 918 |
clearly appearing from the context, any term used in this chapter | 919 |
that is not otherwise defined in this section has the same meaning | 920 |
as when used in a comparable context in the laws of the United | 921 |
States relating to federal income taxes or if not used in a | 922 |
comparable context in those laws, has the same meaning as in | 923 |
section 5733.40 of the Revised Code. Any reference in this chapter | 924 |
to the Internal Revenue Code includes other laws of the United | 925 |
States relating to federal income taxes. | 926 |
As used in this chapter: | 927 |
(A) "Adjusted gross income" or "Ohio adjusted gross income" | 928 |
means federal adjusted gross income, as defined and used in the | 929 |
Internal Revenue Code, adjusted as provided in this section: | 930 |
(1) Add interest or dividends on obligations or securities of | 931 |
any state or of any political subdivision or authority of any | 932 |
state, other than this state and its subdivisions and authorities. | 933 |
(2) Add interest or dividends on obligations of any | 934 |
authority, commission, instrumentality, territory, or possession | 935 |
of the United States to the extent that the interest or dividends | 936 |
are exempt from federal income taxes but not from state income | 937 |
taxes. | 938 |
(3) Deduct interest or dividends on obligations of the United | 939 |
States and its territories and possessions or of any authority, | 940 |
commission, or instrumentality of the United States to the extent | 941 |
that the interest or dividends are included in federal adjusted | 942 |
gross income but exempt from state income taxes under the laws of | 943 |
the United States. | 944 |
(4) Deduct disability and survivor's benefits to the extent | 945 |
included in federal adjusted gross income. | 946 |
(5) Deduct benefits under Title II of the Social Security Act | 947 |
and tier 1 railroad retirement benefits to the extent included in | 948 |
federal adjusted gross income under section 86 of the Internal | 949 |
Revenue Code. | 950 |
(6) In the case of a taxpayer who is a beneficiary of a trust | 951 |
that makes an accumulation distribution as defined in section 665 | 952 |
of the Internal Revenue Code, add, for the beneficiary's taxable | 953 |
years beginning before 2002, the portion, if any, of such | 954 |
distribution that does not exceed the undistributed net income of | 955 |
the trust for the three taxable years preceding the taxable year | 956 |
in which the distribution is made to the extent that the portion | 957 |
was not included in the trust's taxable income for any of the | 958 |
trust's taxable years beginning in 2002 or thereafter. | 959 |
"Undistributed net income of a trust" means the taxable income of | 960 |
the trust increased by (a)(i) the additions to adjusted gross | 961 |
income required under division (A) of this section and (ii) the | 962 |
personal exemptions allowed to the trust pursuant to section | 963 |
642(b) of the Internal Revenue Code, and decreased by (b)(i) the | 964 |
deductions to adjusted gross income required under division (A) of | 965 |
this section, (ii) the amount of federal income taxes attributable | 966 |
to such income, and (iii) the amount of taxable income that has | 967 |
been included in the adjusted gross income of a beneficiary by | 968 |
reason of a prior accumulation distribution. Any undistributed net | 969 |
income included in the adjusted gross income of a beneficiary | 970 |
shall reduce the undistributed net income of the trust commencing | 971 |
with the earliest years of the accumulation period. | 972 |
(7) Deduct the amount of wages and salaries, if any, not | 973 |
otherwise allowable as a deduction but that would have been | 974 |
allowable as a deduction in computing federal adjusted gross | 975 |
income for the taxable year, had the targeted jobs credit allowed | 976 |
and determined under sections 38, 51, and 52 of the Internal | 977 |
Revenue Code not been in effect. | 978 |
(8) Deduct any interest or interest equivalent on public | 979 |
obligations and purchase obligations to the extent that the | 980 |
interest or interest equivalent is included in federal adjusted | 981 |
gross income. | 982 |
(9) Add any loss or deduct any gain resulting from the sale, | 983 |
exchange, or other disposition of public obligations to the extent | 984 |
that the loss has been deducted or the gain has been included in | 985 |
computing federal adjusted gross income. | 986 |
(10) Deduct or add amounts, as provided under section | 987 |
5747.70 of the Revised Code, related to contributions to variable | 988 |
college savings program accounts made or tuition units purchased | 989 |
pursuant to Chapter 3334. of the Revised Code. | 990 |
(11)(a) Deduct, to the extent not otherwise allowable as a | 991 |
deduction or exclusion in computing federal or Ohio adjusted gross | 992 |
income for the taxable year, the amount the taxpayer paid during | 993 |
the taxable year for medical care insurance and qualified | 994 |
long-term care insurance for the taxpayer, the taxpayer's spouse, | 995 |
and dependents. No deduction for medical care insurance under | 996 |
division (A)(11) of this section shall be allowed either to any | 997 |
taxpayer who is eligible to participate in any subsidized health | 998 |
plan maintained by any employer of the taxpayer or of the | 999 |
taxpayer's spouse, or to any taxpayer who is entitled to, or on | 1000 |
application would be entitled to, benefits under part A of Title | 1001 |
XVIII of the "Social Security Act," 49 Stat. 620 (1935), 42 U.S.C. | 1002 |
301, as amended. For the purposes of division (A)(11)(a) of this | 1003 |
section, "subsidized health plan" means a health plan for which | 1004 |
the employer pays any portion of the plan's cost. The deduction | 1005 |
allowed under division (A)(11)(a) of this section shall be the | 1006 |
net of any related premium refunds, related premium | 1007 |
reimbursements, or related insurance premium dividends received | 1008 |
during the taxable year. | 1009 |
(b) Deduct, to the extent not otherwise deducted or excluded | 1010 |
in computing federal or Ohio adjusted gross income during the | 1011 |
taxable year, the amount the taxpayer paid during the taxable | 1012 |
year, not compensated for by any insurance or otherwise, for | 1013 |
medical care of the taxpayer, the taxpayer's spouse, and | 1014 |
dependents, to the extent the expenses exceed seven and one-half | 1015 |
per cent of the taxpayer's federal adjusted gross income. | 1016 |
(c) Deduct, to the extent not otherwise deducted or excluded | 1017 |
in computing federal or Ohio adjusted gross income, any amount | 1018 |
included in federal adjusted gross income under section 105 or not | 1019 |
excluded under section 106 of the Internal Revenue Code solely | 1020 |
because it relates to an accident and health plan for a person who | 1021 |
otherwise would be a "qualifying relative" and thus a "dependent" | 1022 |
under section 152 of the Internal Revenue Code but for the fact | 1023 |
that the person fails to meet the income and support limitations | 1024 |
under section 152(d)(1)(B) and (C) of the Internal Revenue Code. | 1025 |
(d) For purposes of division (A)(11) of this section, | 1026 |
"medical care" has the meaning given in section 213 of the | 1027 |
Internal Revenue Code, subject to the special rules, limitations, | 1028 |
and exclusions set forth therein, and "qualified long-term care" | 1029 |
has the same meaning given in section 7702B(c) of the Internal | 1030 |
Revenue Code. Solely for purposes of divisions (A)(11)(a) and (c) | 1031 |
of this section, "dependent" includes a person who otherwise | 1032 |
would be a "qualifying relative" and thus a "dependent" under | 1033 |
section 152 of the Internal Revenue Code but for the fact that | 1034 |
the person fails to meet the income and support limitations under | 1035 |
section 152(d)(1)(B) and (C) of the Internal Revenue Code. | 1036 |
(12)(a) Deduct any amount included in federal adjusted gross | 1037 |
income solely because the amount represents a reimbursement or | 1038 |
refund of expenses that in any year the taxpayer had deducted as | 1039 |
an itemized deduction pursuant to section 63 of the Internal | 1040 |
Revenue Code and applicable United States department of the | 1041 |
treasury regulations. The deduction otherwise allowed under | 1042 |
division (A)(12)(a) of this section shall be reduced to the extent | 1043 |
the reimbursement is attributable to an amount the taxpayer | 1044 |
deducted under this section in any taxable year. | 1045 |
(b) Add any amount not otherwise included in Ohio adjusted | 1046 |
gross income for any taxable year to the extent that the amount is | 1047 |
attributable to the recovery during the taxable year of any amount | 1048 |
deducted or excluded in computing federal or Ohio adjusted gross | 1049 |
income in any taxable year. | 1050 |
(13) Deduct any portion of the deduction described in section | 1051 |
1341(a)(2) of the Internal Revenue Code, for repaying previously | 1052 |
reported income received under a claim of right, that meets both | 1053 |
of the following requirements: | 1054 |
(a) It is allowable for repayment of an item that was | 1055 |
included in the taxpayer's adjusted gross income for a prior | 1056 |
taxable year and did not qualify for a credit under division (A) | 1057 |
or (B) of section 5747.05 of the Revised Code for that year; | 1058 |
(b) It does not otherwise reduce the taxpayer's adjusted | 1059 |
gross income for the current or any other taxable year. | 1060 |
(14) Deduct an amount equal to the deposits made to, and net | 1061 |
investment earnings of, a medical savings account during the | 1062 |
taxable year, in accordance with section 3924.66 of the Revised | 1063 |
Code. The deduction allowed by division (A)(14) of this section | 1064 |
does not apply to medical savings account deposits and earnings | 1065 |
otherwise deducted or excluded for the current or any other | 1066 |
taxable year from the taxpayer's federal adjusted gross income. | 1067 |
(15)(a) Add an amount equal to the funds withdrawn from a | 1068 |
medical savings account during the taxable year, and the net | 1069 |
investment earnings on those funds, when the funds withdrawn were | 1070 |
used for any purpose other than to reimburse an account holder | 1071 |
for, or to pay, eligible medical expenses, in accordance with | 1072 |
section 3924.66 of the Revised Code; | 1073 |
(b) Add the amounts distributed from a medical savings | 1074 |
account under division (A)(2) of section 3924.68 of the Revised | 1075 |
Code during the taxable year. | 1076 |
(16) Add any amount claimed as a credit under section | 1077 |
5747.059 of the Revised Code to the extent that such amount | 1078 |
satisfies either of the following: | 1079 |
(a) The amount was deducted or excluded from the computation | 1080 |
of the taxpayer's federal adjusted gross income as required to be | 1081 |
reported for the taxpayer's taxable year under the Internal | 1082 |
Revenue Code; | 1083 |
(b) The amount resulted in a reduction of the taxpayer's | 1084 |
federal adjusted gross income as required to be reported for any | 1085 |
of the taxpayer's taxable years under the Internal Revenue Code. | 1086 |
(17) Deduct the amount contributed by the taxpayer to an | 1087 |
individual development account program established by a county | 1088 |
department of job and family services pursuant to sections 329.11 | 1089 |
to 329.14 of the Revised Code for the purpose of matching funds | 1090 |
deposited by program participants. On request of the tax | 1091 |
commissioner, the taxpayer shall provide any information that, in | 1092 |
the tax commissioner's opinion, is necessary to establish the | 1093 |
amount deducted under division (A)(17) of this section. | 1094 |
(18) Beginning in taxable year 2001 but not for any taxable | 1095 |
year beginning after December 31, 2005, if the taxpayer is married | 1096 |
and files a joint return and the combined federal adjusted gross | 1097 |
income of the taxpayer and the taxpayer's spouse for the taxable | 1098 |
year does not exceed one hundred thousand dollars, or if the | 1099 |
taxpayer is single and has a federal adjusted gross income for the | 1100 |
taxable year not exceeding fifty thousand dollars, deduct amounts | 1101 |
paid during the taxable year for qualified tuition and fees paid | 1102 |
to an eligible institution for the taxpayer, the taxpayer's | 1103 |
spouse, or any dependent of the taxpayer, who is a resident of | 1104 |
this state and is enrolled in or attending a program that | 1105 |
culminates in a degree or diploma at an eligible institution. The | 1106 |
deduction may be claimed only to the extent that qualified tuition | 1107 |
and fees are not otherwise deducted or excluded for any taxable | 1108 |
year from federal or Ohio adjusted gross income. The deduction may | 1109 |
not be claimed for educational expenses for which the taxpayer | 1110 |
claims a credit under section 5747.27 of the Revised Code. | 1111 |
(19) Add any reimbursement received during the taxable year | 1112 |
of any amount the taxpayer deducted under division (A)(18) of this | 1113 |
section in any previous taxable year to the extent the amount is | 1114 |
not otherwise included in Ohio adjusted gross income. | 1115 |
(20)(a)(i) Add five-sixths of the amount of depreciation | 1116 |
expense allowed by subsection (k) of section 168 of the Internal | 1117 |
Revenue Code, including the taxpayer's proportionate or | 1118 |
distributive share of the amount of depreciation expense allowed | 1119 |
by that subsection to a pass-through entity in which the taxpayer | 1120 |
has a direct or indirect ownership interest. | 1121 |
(ii) Add five-sixths of the amount of qualifying section 179 | 1122 |
depreciation expense, including a person's proportionate or | 1123 |
distributive share of the amount of qualifying section 179 | 1124 |
depreciation expense allowed to any pass-through entity in which | 1125 |
the person has a direct or indirect ownership. For the purposes of | 1126 |
this division, "qualifying section 179 depreciation expense" means | 1127 |
the difference between (I) the amount of depreciation expense | 1128 |
directly or indirectly allowed to the taxpayer under section 179 | 1129 |
of the Internal Revenue Code, and (II) the amount of depreciation | 1130 |
expense directly or indirectly allowed to the taxpayer under | 1131 |
section 179 of the Internal Revenue Code as that section existed | 1132 |
on December 31, 2002. | 1133 |
The tax commissioner, under procedures established by the | 1134 |
commissioner, may waive the add-backs related to a pass-through | 1135 |
entity if the taxpayer owns, directly or indirectly, less than | 1136 |
five per cent of the pass-through entity. | 1137 |
(b) Nothing in division (A)(20) of this section shall be | 1138 |
construed to adjust or modify the adjusted basis of any asset. | 1139 |
(c) To the extent the add-back required under division | 1140 |
(A)(20)(a) of this section is attributable to property generating | 1141 |
nonbusiness income or loss allocated under section 5747.20 of the | 1142 |
Revised Code, the add-back shall be sitused to the same location | 1143 |
as the nonbusiness income or loss generated by the property for | 1144 |
the purpose of determining the credit under division (A) of | 1145 |
section 5747.05 of the Revised Code. Otherwise, the add-back shall | 1146 |
be apportioned, subject to one or more of the four alternative | 1147 |
methods of apportionment enumerated in section 5747.21 of the | 1148 |
Revised Code. | 1149 |
(d) For the purposes of division (A) of this section, net | 1150 |
operating loss carryback and carryforward shall not include | 1151 |
five-sixths of the allowance of any net operating loss deduction | 1152 |
carryback or carryforward to the taxable year to the extent such | 1153 |
loss resulted from depreciation allowed by section 168(k) of the | 1154 |
Internal Revenue Code and by the qualifying section 179 | 1155 |
depreciation expense amount. | 1156 |
(21)(a) If the taxpayer was required to add an amount under | 1157 |
division (A)(20)(a) of this section for a taxable year, deduct | 1158 |
one-fifth of the amount so added for each of the five succeeding | 1159 |
taxable years. | 1160 |
(b) If the amount deducted under division (A)(21)(a) of this | 1161 |
section is attributable to an add-back allocated under division | 1162 |
(A)(20)(c) of this section, the amount deducted shall be sitused | 1163 |
to the same location. Otherwise, the add-back shall be apportioned | 1164 |
using the apportionment factors for the taxable year in which the | 1165 |
deduction is taken, subject to one or more of the four alternative | 1166 |
methods of apportionment enumerated in section 5747.21 of the | 1167 |
Revised Code. | 1168 |
(c) No deduction is available under division (A)(21)(a) of | 1169 |
this section with regard to any depreciation allowed by section | 1170 |
168(k) of the Internal Revenue Code and by the qualifying section | 1171 |
179 depreciation expense amount to the extent that such | 1172 |
depreciation resulted in or increased a federal net operating loss | 1173 |
carryback or carryforward to a taxable year to which division | 1174 |
(A)(20)(d) of this section does not apply. | 1175 |
(22) Deduct, to the extent not otherwise deducted or excluded | 1176 |
in computing federal or Ohio adjusted gross income for the taxable | 1177 |
year, the amount the taxpayer received during the taxable year as | 1178 |
reimbursement for life insurance premiums under section 5919.31 of | 1179 |
the Revised Code. | 1180 |
(23) Deduct, to the extent not otherwise deducted or excluded | 1181 |
in computing federal or Ohio adjusted gross income for the taxable | 1182 |
year, the amount the taxpayer received during the taxable year as | 1183 |
a death benefit paid by the adjutant general under section 5919.33 | 1184 |
of the Revised Code. | 1185 |
(24) Deduct, to the extent included in federal adjusted gross | 1186 |
income and not otherwise allowable as a deduction or exclusion in | 1187 |
computing federal or Ohio adjusted gross income for the taxable | 1188 |
year, military pay and allowances received by the taxpayer during | 1189 |
the taxable year for active duty service in the United States | 1190 |
army, air force, navy, marine corps, or coast guard or reserve | 1191 |
components thereof or the national guard. The deduction may not be | 1192 |
claimed for military pay and allowances received by the taxpayer | 1193 |
while the taxpayer is stationed in this state. | 1194 |
(25) Deduct, to the extent not otherwise allowable as a | 1195 |
deduction or exclusion in computing federal or Ohio adjusted gross | 1196 |
income for the taxable year and not otherwise compensated for by | 1197 |
any other source, the amount of qualified organ donation expenses | 1198 |
incurred by the taxpayer during the taxable year, not to exceed | 1199 |
ten thousand dollars. A taxpayer may deduct qualified organ | 1200 |
donation expenses only once for all taxable years beginning with | 1201 |
taxable years beginning in 2007. | 1202 |
For the purposes of division (A)(25) of this section: | 1203 |
(a) "Human organ" means all or any portion of a human liver, | 1204 |
pancreas, kidney, intestine, or lung, and any portion of human | 1205 |
bone marrow. | 1206 |
(b) "Qualified organ donation expenses" means travel | 1207 |
expenses, lodging expenses, and wages and salary forgone by a | 1208 |
taxpayer in connection with the taxpayer's donation, while living, | 1209 |
of one or more of the taxpayer's human organs to another human | 1210 |
being. | 1211 |
(26) Deduct, to the extent not otherwise deducted or excluded | 1212 |
in computing federal or Ohio adjusted gross income for the taxable | 1213 |
year, amounts received by the taxpayer as retired military | 1214 |
personnel pay for service in the United States army, navy, air | 1215 |
force, coast guard, or marine corps or reserve components thereof, | 1216 |
or the national guard, or received by the surviving spouse or | 1217 |
former spouse of such a taxpayer under the survivor benefit plan | 1218 |
on account of such a taxpayer's death. If the taxpayer receives | 1219 |
income on account of retirement paid under the federal civil | 1220 |
service retirement system or federal employees retirement system, | 1221 |
or under any successor retirement program enacted by the congress | 1222 |
of the United States that is established and maintained for | 1223 |
retired employees of the United States government, and such | 1224 |
retirement income is based, in whole or in part, on credit for | 1225 |
the taxpayer's military service, the deduction allowed under this | 1226 |
division shall include only that portion of such retirement | 1227 |
income that is attributable to the taxpayer's military service, | 1228 |
to the extent that portion of such retirement income is otherwise | 1229 |
included in federal adjusted gross income and is not otherwise | 1230 |
deducted under this section. Any amount deducted under division | 1231 |
(A)(26) of this section is not included in a taxpayer's | 1232 |
adjusted gross income for the purposes of section 5747.055 of | 1233 |
the Revised Code. No amount may be deducted under division | 1234 |
(A)(26) of this section on the basis of which a credit was | 1235 |
claimed under section 5747.055 of the Revised Code. | 1236 |
(27) Deduct, to the extent not otherwise deducted or excluded | 1237 |
in computing federal or Ohio adjusted gross income for the taxable | 1238 |
year, the amount the taxpayer received during the taxable year | 1239 |
from the military injury relief fund created in section 5101.98 of | 1240 |
the Revised Code. | 1241 |
(28) For the taxpayer's taxable year beginning in 2009, add | 1242 |
any amount excluded from federal adjusted gross income pursuant to | 1243 |
section 85(c) of the Internal Revenue Code. | 1244 |
(29) Add any amount by which federal adjusted gross income is | 1245 |
reduced because of an election under section 172(b)(1)(H) of the | 1246 |
Internal Revenue Code as amended by the "American Recovery and | 1247 |
Reinvestment Act of 2009," 123 Stat. 115. | 1248 |
(30)(a) Add any amount not included in federal adjusted | 1249 |
gross income for the taxable year because of an election under | 1250 |
section 108(i) of the Internal Revenue Code. | 1251 |
(b) Deduct any amount included in federal adjusted gross | 1252 |
income for the taxable year because of an election under section | 1253 |
108(i) of the Internal Revenue Code. | 1254 |
(B) "Business income" means income, including gain or loss, | 1255 |
arising from transactions, activities, and sources in the regular | 1256 |
course of a trade or business and includes income, gain, or loss | 1257 |
from real property, tangible property, and intangible property if | 1258 |
the acquisition, rental, management, and disposition of the | 1259 |
property constitute integral parts of the regular course of a | 1260 |
trade or business operation. "Business income" includes income, | 1261 |
including gain or loss, from a partial or complete liquidation of | 1262 |
a business, including, but not limited to, gain or loss from the | 1263 |
sale or other disposition of goodwill. | 1264 |
(C) "Nonbusiness income" means all income other than business | 1265 |
income and may include, but is not limited to, compensation, rents | 1266 |
and royalties from real or tangible personal property, capital | 1267 |
gains, interest, dividends and distributions, patent or copyright | 1268 |
royalties, or lottery winnings, prizes, and awards. | 1269 |
(D) "Compensation" means any form of remuneration paid to an | 1270 |
employee for personal services. | 1271 |
(E) "Fiduciary" means a guardian, trustee, executor, | 1272 |
administrator, receiver, conservator, or any other person acting | 1273 |
in any fiduciary capacity for any individual, trust, or estate. | 1274 |
(F) "Fiscal year" means an accounting period of twelve months | 1275 |
ending on the last day of any month other than December. | 1276 |
(G) "Individual" means any natural person. | 1277 |
(H) "Internal Revenue Code" means the "Internal Revenue Code | 1278 |
of 1986," 100 Stat. 2085, 26 U.S.C.A. 1, as amended. | 1279 |
(I) "Resident" means any of the following, provided that | 1280 |
division (I)(3) of this section applies only to taxable years of a | 1281 |
trust beginning in 2002 or thereafter: | 1282 |
(1) An individual who is domiciled in this state, subject to | 1283 |
section 5747.24 of the Revised Code; | 1284 |
(2) The estate of a decedent who at the time of death was | 1285 |
domiciled in this state. The domicile tests of section 5747.24 of | 1286 |
the Revised Code are not controlling for purposes of division | 1287 |
(I)(2) of this section. | 1288 |
(3) A trust that, in whole or part, resides in this state. If | 1289 |
only part of a trust resides in this state, the trust is a | 1290 |
resident only with respect to that part. | 1291 |
For the purposes of division (I)(3) of this section: | 1292 |
(a) A trust resides in this state for the trust's current | 1293 |
taxable year to the extent, as described in division (I)(3)(d) of | 1294 |
this section, that the trust consists directly or indirectly, in | 1295 |
whole or in part, of assets, net of any related liabilities, that | 1296 |
were transferred, or caused to be transferred, directly or | 1297 |
indirectly, to the trust by any of the following: | 1298 |
(i) A person, a court, or a governmental entity or | 1299 |
instrumentality on account of the death of a decedent, but only if | 1300 |
the trust is described in division (I)(3)(e)(i) or (ii) of this | 1301 |
section; | 1302 |
(ii) A person who was domiciled in this state for the | 1303 |
purposes of this chapter when the person directly or indirectly | 1304 |
transferred assets to an irrevocable trust, but only if at least | 1305 |
one of the trust's qualifying beneficiaries is domiciled in this | 1306 |
state for the purposes of this chapter during all or some portion | 1307 |
of the trust's current taxable year; | 1308 |
(iii) A person who was domiciled in this state for the | 1309 |
purposes of this chapter when the trust document or instrument or | 1310 |
part of the trust document or instrument became irrevocable, but | 1311 |
only if at least one of the trust's qualifying beneficiaries is a | 1312 |
resident domiciled in this state for the purposes of this chapter | 1313 |
during all or some portion of the trust's current taxable year. If | 1314 |
a trust document or instrument became irrevocable upon the death | 1315 |
of a person who at the time of death was domiciled in this state | 1316 |
for purposes of this chapter, that person is a person described in | 1317 |
division (I)(3)(a)(iii) of this section. | 1318 |
(b) A trust is irrevocable to the extent that the transferor | 1319 |
is not considered to be the owner of the net assets of the trust | 1320 |
under sections 671 to 678 of the Internal Revenue Code. | 1321 |
(c) With respect to a trust other than a charitable lead | 1322 |
trust, "qualifying beneficiary" has the same meaning as "potential | 1323 |
current beneficiary" as defined in section 1361(e)(2) of the | 1324 |
Internal Revenue Code, and with respect to a charitable lead trust | 1325 |
"qualifying beneficiary" is any current, future, or contingent | 1326 |
beneficiary, but with respect to any trust "qualifying | 1327 |
beneficiary" excludes a person or a governmental entity or | 1328 |
instrumentality to any of which a contribution would qualify for | 1329 |
the charitable deduction under section 170 of the Internal Revenue | 1330 |
Code. | 1331 |
(d) For the purposes of division (I)(3)(a) of this section, | 1332 |
the extent to which a trust consists directly or indirectly, in | 1333 |
whole or in part, of assets, net of any related liabilities, that | 1334 |
were transferred directly or indirectly, in whole or part, to the | 1335 |
trust by any of the sources enumerated in that division shall be | 1336 |
ascertained by multiplying the fair market value of the trust's | 1337 |
assets, net of related liabilities, by the qualifying ratio, which | 1338 |
shall be computed as follows: | 1339 |
(i) The first time the trust receives assets, the numerator | 1340 |
of the qualifying ratio is the fair market value of those assets | 1341 |
at that time, net of any related liabilities, from sources | 1342 |
enumerated in division (I)(3)(a) of this section. The denominator | 1343 |
of the qualifying ratio is the fair market value of all the | 1344 |
trust's assets at that time, net of any related liabilities. | 1345 |
(ii) Each subsequent time the trust receives assets, a | 1346 |
revised qualifying ratio shall be computed. The numerator of the | 1347 |
revised qualifying ratio is the sum of (1) the fair market value | 1348 |
of the trust's assets immediately prior to the subsequent | 1349 |
transfer, net of any related liabilities, multiplied by the | 1350 |
qualifying ratio last computed without regard to the subsequent | 1351 |
transfer, and (2) the fair market value of the subsequently | 1352 |
transferred assets at the time transferred, net of any related | 1353 |
liabilities, from sources enumerated in division (I)(3)(a) of this | 1354 |
section. The denominator of the revised qualifying ratio is the | 1355 |
fair market value of all the trust's assets immediately after the | 1356 |
subsequent transfer, net of any related liabilities. | 1357 |
(iii) Whether a transfer to the trust is by or from any of | 1358 |
the sources enumerated in division (I)(3)(a) of this section shall | 1359 |
be ascertained without regard to the domicile of the trust's | 1360 |
beneficiaries. | 1361 |
(e) For the purposes of division (I)(3)(a)(i) of this | 1362 |
section: | 1363 |
(i) A trust is described in division (I)(3)(e)(i) of this | 1364 |
section if the trust is a testamentary trust and the testator of | 1365 |
that testamentary trust was domiciled in this state at the time of | 1366 |
the testator's death for purposes of the taxes levied under | 1367 |
Chapter 5731. of the Revised Code. | 1368 |
(ii) A trust is described in division (I)(3)(e)(ii) of this | 1369 |
section if the transfer is a qualifying transfer described in any | 1370 |
of divisions (I)(3)(f)(i) to (vi) of this section, the trust is an | 1371 |
irrevocable inter vivos trust, and at least one of the trust's | 1372 |
qualifying beneficiaries is domiciled in this state for purposes | 1373 |
of this chapter during all or some portion of the trust's current | 1374 |
taxable year. | 1375 |
(f) For the purposes of division (I)(3)(e)(ii) of this | 1376 |
section, a "qualifying transfer" is a transfer of assets, net of | 1377 |
any related liabilities, directly or indirectly to a trust, if the | 1378 |
transfer is described in any of the following: | 1379 |
(i) The transfer is made to a trust, created by the decedent | 1380 |
before the decedent's death and while the decedent was domiciled | 1381 |
in this state for the purposes of this chapter, and, prior to the | 1382 |
death of the decedent, the trust became irrevocable while the | 1383 |
decedent was domiciled in this state for the purposes of this | 1384 |
chapter. | 1385 |
(ii) The transfer is made to a trust to which the decedent, | 1386 |
prior to the decedent's death, had directly or indirectly | 1387 |
transferred assets, net of any related liabilities, while the | 1388 |
decedent was domiciled in this state for the purposes of this | 1389 |
chapter, and prior to the death of the decedent the trust became | 1390 |
irrevocable while the decedent was domiciled in this state for the | 1391 |
purposes of this chapter. | 1392 |
(iii) The transfer is made on account of a contractual | 1393 |
relationship existing directly or indirectly between the | 1394 |
transferor and either the decedent or the estate of the decedent | 1395 |
at any time prior to the date of the decedent's death, and the | 1396 |
decedent was domiciled in this state at the time of death for | 1397 |
purposes of the taxes levied under Chapter 5731. of the Revised | 1398 |
Code. | 1399 |
(iv) The transfer is made to a trust on account of a | 1400 |
contractual relationship existing directly or indirectly between | 1401 |
the transferor and another person who at the time of the | 1402 |
decedent's death was domiciled in this state for purposes of this | 1403 |
chapter. | 1404 |
(v) The transfer is made to a trust on account of the will of | 1405 |
a testator. | 1406 |
(vi) The transfer is made to a trust created by or caused to | 1407 |
be created by a court, and the trust was directly or indirectly | 1408 |
created in connection with or as a result of the death of an | 1409 |
individual who, for purposes of the taxes levied under Chapter | 1410 |
5731. of the Revised Code, was domiciled in this state at the time | 1411 |
of the individual's death. | 1412 |
(g) The tax commissioner may adopt rules to ascertain the | 1413 |
part of a trust residing in this state. | 1414 |
(J) "Nonresident" means an individual or estate that is not a | 1415 |
resident. An individual who is a resident for only part of a | 1416 |
taxable year is a nonresident for the remainder of that taxable | 1417 |
year. | 1418 |
(K) "Pass-through entity" has the same meaning as in section | 1419 |
5733.04 of the Revised Code. | 1420 |
(L) "Return" means the notifications and reports required to | 1421 |
be filed pursuant to this chapter for the purpose of reporting the | 1422 |
tax due and includes declarations of estimated tax when so | 1423 |
required. | 1424 |
(M) "Taxable year" means the calendar year or the taxpayer's | 1425 |
fiscal year ending during the calendar year, or fractional part | 1426 |
thereof, upon which the adjusted gross income is calculated | 1427 |
pursuant to this chapter. | 1428 |
(N) "Taxpayer" means any person subject to the tax imposed by | 1429 |
section 5747.02 of the Revised Code or any pass-through entity | 1430 |
that makes the election under division (D) of section 5747.08 of | 1431 |
the Revised Code. | 1432 |
(O) "Dependents" means dependents as defined in the Internal | 1433 |
Revenue Code and as claimed in the taxpayer's federal income tax | 1434 |
return for the taxable year or which the taxpayer would have been | 1435 |
permitted to claim had the taxpayer filed a federal income tax | 1436 |
return. | 1437 |
(P) "Principal county of employment" means, in the case of a | 1438 |
nonresident, the county within the state in which a taxpayer | 1439 |
performs services for an employer or, if those services are | 1440 |
performed in more than one county, the county in which the major | 1441 |
portion of the services are performed. | 1442 |
(Q) As used in sections 5747.50 to 5747.55 of the Revised | 1443 |
Code: | 1444 |
(1) "Subdivision" means any county, municipal corporation, | 1445 |
park district, or township. | 1446 |
(2) "Essential local government purposes" includes all | 1447 |
functions that any subdivision is required by general law to | 1448 |
exercise, including like functions that are exercised under a | 1449 |
charter adopted pursuant to the Ohio Constitution. | 1450 |
(R) "Overpayment" means any amount already paid that exceeds | 1451 |
the figure determined to be the correct amount of the tax. | 1452 |
(S) "Taxable income" or "Ohio taxable income" applies only to | 1453 |
estates and trusts, and means federal taxable income, as defined | 1454 |
and used in the Internal Revenue Code, adjusted as follows: | 1455 |
(1) Add interest or dividends, net of ordinary, necessary, | 1456 |
and reasonable expenses not deducted in computing federal taxable | 1457 |
income, on obligations or securities of any state or of any | 1458 |
political subdivision or authority of any state, other than this | 1459 |
state and its subdivisions and authorities, but only to the extent | 1460 |
that such net amount is not otherwise includible in Ohio taxable | 1461 |
income and is described in either division (S)(1)(a) or (b) of | 1462 |
this section: | 1463 |
(a) The net amount is not attributable to the S portion of an | 1464 |
electing small business trust and has not been distributed to | 1465 |
beneficiaries for the taxable year; | 1466 |
(b) The net amount is attributable to the S portion of an | 1467 |
electing small business trust for the taxable year. | 1468 |
(2) Add interest or dividends, net of ordinary, necessary, | 1469 |
and reasonable expenses not deducted in computing federal taxable | 1470 |
income, on obligations of any authority, commission, | 1471 |
instrumentality, territory, or possession of the United States to | 1472 |
the extent that the interest or dividends are exempt from federal | 1473 |
income taxes but not from state income taxes, but only to the | 1474 |
extent that such net amount is not otherwise includible in Ohio | 1475 |
taxable income and is described in either division (S)(1)(a) or | 1476 |
(b) of this section; | 1477 |
(3) Add the amount of personal exemption allowed to the | 1478 |
estate pursuant to section 642(b) of the Internal Revenue Code; | 1479 |
(4) Deduct interest or dividends, net of related expenses | 1480 |
deducted in computing federal taxable income, on obligations of | 1481 |
the United States and its territories and possessions or of any | 1482 |
authority, commission, or instrumentality of the United States to | 1483 |
the extent that the interest or dividends are exempt from state | 1484 |
taxes under the laws of the United States, but only to the extent | 1485 |
that such amount is included in federal taxable income and is | 1486 |
described in either division (S)(1)(a) or (b) of this section; | 1487 |
(5) Deduct the amount of wages and salaries, if any, not | 1488 |
otherwise allowable as a deduction but that would have been | 1489 |
allowable as a deduction in computing federal taxable income for | 1490 |
the taxable year, had the targeted jobs credit allowed under | 1491 |
sections 38, 51, and 52 of the Internal Revenue Code not been in | 1492 |
effect, but only to the extent such amount relates either to | 1493 |
income included in federal taxable income for the taxable year or | 1494 |
to income of the S portion of an electing small business trust for | 1495 |
the taxable year; | 1496 |
(6) Deduct any interest or interest equivalent, net of | 1497 |
related expenses deducted in computing federal taxable income, on | 1498 |
public obligations and purchase obligations, but only to the | 1499 |
extent that such net amount relates either to income included in | 1500 |
federal taxable income for the taxable year or to income of the S | 1501 |
portion of an electing small business trust for the taxable year; | 1502 |
(7) Add any loss or deduct any gain resulting from sale, | 1503 |
exchange, or other disposition of public obligations to the extent | 1504 |
that such loss has been deducted or such gain has been included in | 1505 |
computing either federal taxable income or income of the S portion | 1506 |
of an electing small business trust for the taxable year; | 1507 |
(8) Except in the case of the final return of an estate, add | 1508 |
any amount deducted by the taxpayer on both its Ohio estate tax | 1509 |
return pursuant to section 5731.14 of the Revised Code, and on its | 1510 |
federal income tax return in determining federal taxable income; | 1511 |
(9)(a) Deduct any amount included in federal taxable income | 1512 |
solely because the amount represents a reimbursement or refund of | 1513 |
expenses that in a previous year the decedent had deducted as an | 1514 |
itemized deduction pursuant to section 63 of the Internal Revenue | 1515 |
Code and applicable treasury regulations. The deduction otherwise | 1516 |
allowed under division (S)(9)(a) of this section shall be reduced | 1517 |
to the extent the reimbursement is attributable to an amount the | 1518 |
taxpayer or decedent deducted under this section in any taxable | 1519 |
year. | 1520 |
(b) Add any amount not otherwise included in Ohio taxable | 1521 |
income for any taxable year to the extent that the amount is | 1522 |
attributable to the recovery during the taxable year of any amount | 1523 |
deducted or excluded in computing federal or Ohio taxable income | 1524 |
in any taxable year, but only to the extent such amount has not | 1525 |
been distributed to beneficiaries for the taxable year. | 1526 |
(10) Deduct any portion of the deduction described in section | 1527 |
1341(a)(2) of the Internal Revenue Code, for repaying previously | 1528 |
reported income received under a claim of right, that meets both | 1529 |
of the following requirements: | 1530 |
(a) It is allowable for repayment of an item that was | 1531 |
included in the taxpayer's taxable income or the decedent's | 1532 |
adjusted gross income for a prior taxable year and did not qualify | 1533 |
for a credit under division (A) or (B) of section 5747.05 of the | 1534 |
Revised Code for that year. | 1535 |
(b) It does not otherwise reduce the taxpayer's taxable | 1536 |
income or the decedent's adjusted gross income for the current or | 1537 |
any other taxable year. | 1538 |
(11) Add any amount claimed as a credit under section | 1539 |
5747.059 of the Revised Code to the extent that the amount | 1540 |
satisfies either of the following: | 1541 |
(a) The amount was deducted or excluded from the computation | 1542 |
of the taxpayer's federal taxable income as required to be | 1543 |
reported for the taxpayer's taxable year under the Internal | 1544 |
Revenue Code; | 1545 |
(b) The amount resulted in a reduction in the taxpayer's | 1546 |
federal taxable income as required to be reported for any of the | 1547 |
taxpayer's taxable years under the Internal Revenue Code. | 1548 |
(12) Deduct any amount, net of related expenses deducted in | 1549 |
computing federal taxable income, that a trust is required to | 1550 |
report as farm income on its federal income tax return, but only | 1551 |
if the assets of the trust include at least ten acres of land | 1552 |
satisfying the definition of "land devoted exclusively to | 1553 |
agricultural use" under section 5713.30 of the Revised Code, | 1554 |
regardless of whether the land is valued for tax purposes as such | 1555 |
land under sections 5713.30 to 5713.38 of the Revised Code. If the | 1556 |
trust is a pass-through entity investor, section 5747.231 of the | 1557 |
Revised Code applies in ascertaining if the trust is eligible to | 1558 |
claim the deduction provided by division (S)(12) of this section | 1559 |
in connection with the pass-through entity's farm income. | 1560 |
Except for farm income attributable to the S portion of an | 1561 |
electing small business trust, the deduction provided by division | 1562 |
(S)(12) of this section is allowed only to the extent that the | 1563 |
trust has not distributed such farm income. Division (S)(12) of | 1564 |
this section applies only to taxable years of a trust beginning in | 1565 |
2002 or thereafter. | 1566 |
(13) Add the net amount of income described in section 641(c) | 1567 |
of the Internal Revenue Code to the extent that amount is not | 1568 |
included in federal taxable income. | 1569 |
(14) Add or deduct the amount the taxpayer would be required | 1570 |
to add or deduct under division (A)(20) or (21) of this section if | 1571 |
the taxpayer's Ohio taxable income were computed in the same | 1572 |
manner as an individual's Ohio adjusted gross income is computed | 1573 |
under this section. In the case of a trust, division (S)(14) of | 1574 |
this section applies only to any of the trust's taxable years | 1575 |
beginning in 2002 or thereafter. | 1576 |
(15) Add any amount by which federal taxable income is | 1577 |
reduced because of an election under section 172(b)(1)(H) of the | 1578 |
Internal Revenue Code as amended by the "American Recovery and | 1579 |
Reinvestment Act of 2009," 123 Stat. 115. | 1580 |
(16)(a) Add any amount not included in federal taxable income | 1581 |
for the taxable year because of an election under section 108(i) | 1582 |
of the Internal Revenue Code. | 1583 |
(b) Deduct any amount included in federal taxable income for | 1584 |
the taxable year because of an election under section 108(i) of | 1585 |
the Internal Revenue Code. | 1586 |
(T) "School district income" and "school district income tax" | 1587 |
have the same meanings as in section 5748.01 of the Revised Code. | 1588 |
(U) As used in divisions (A)(8), (A)(9), (S)(6), and (S)(7) | 1589 |
of this section, "public obligations," "purchase obligations," and | 1590 |
"interest or interest equivalent" have the same meanings as in | 1591 |
section 5709.76 of the Revised Code. | 1592 |
(V) "Limited liability company" means any limited liability | 1593 |
company formed under Chapter 1705. of the Revised Code or under | 1594 |
the laws of any other state. | 1595 |
(W) "Pass-through entity investor" means any person who, | 1596 |
during any portion of a taxable year of a pass-through entity, is | 1597 |
a partner, member, shareholder, or equity investor in that | 1598 |
pass-through entity. | 1599 |
(X) "Banking day" has the same meaning as in section 1304.01 | 1600 |
of the Revised Code. | 1601 |
(Y) "Month" means a calendar month. | 1602 |
(Z) "Quarter" means the first three months, the second three | 1603 |
months, the third three months, or the last three months of the | 1604 |
taxpayer's taxable year. | 1605 |
(AA)(1) "Eligible institution" means a state university or | 1606 |
state institution of higher education as defined in section | 1607 |
3345.011 of the Revised Code, or a private, nonprofit college, | 1608 |
university, or other post-secondary institution located in this | 1609 |
state that possesses a certificate of authorization issued by the | 1610 |
Ohio board of regents pursuant to Chapter 1713. of the Revised | 1611 |
Code or a certificate of registration issued by the state board of | 1612 |
career colleges and schools under Chapter 3332. of the Revised | 1613 |
Code. | 1614 |
(2) "Qualified tuition and fees" means tuition and fees | 1615 |
imposed by an eligible institution as a condition of enrollment or | 1616 |
attendance, not exceeding two thousand five hundred dollars in | 1617 |
each of the individual's first two years of post-secondary | 1618 |
education. If the individual is a part-time student, "qualified | 1619 |
tuition and fees" includes tuition and fees paid for the academic | 1620 |
equivalent of the first two years of post-secondary education | 1621 |
during a maximum of five taxable years, not exceeding a total of | 1622 |
five thousand dollars. "Qualified tuition and fees" does not | 1623 |
include: | 1624 |
(a) Expenses for any course or activity involving sports, | 1625 |
games, or hobbies unless the course or activity is part of the | 1626 |
individual's degree or diploma program; | 1627 |
(b) The cost of books, room and board, student activity fees, | 1628 |
athletic fees, insurance expenses, or other expenses unrelated to | 1629 |
the individual's academic course of instruction; | 1630 |
(c) Tuition, fees, or other expenses paid or reimbursed | 1631 |
through an employer, scholarship, grant in aid, or other | 1632 |
educational benefit program. | 1633 |
(BB)(1) "Modified business income" means the business income | 1634 |
included in a trust's Ohio taxable income after such taxable | 1635 |
income is first reduced by the qualifying trust amount, if any. | 1636 |
(2) "Qualifying trust amount" of a trust means capital gains | 1637 |
and losses from the sale, exchange, or other disposition of equity | 1638 |
or ownership interests in, or debt obligations of, a qualifying | 1639 |
investee to the extent included in the trust's Ohio taxable | 1640 |
income, but only if the following requirements are satisfied: | 1641 |
(a) The book value of the qualifying investee's physical | 1642 |
assets in this state and everywhere, as of the last day of the | 1643 |
qualifying investee's fiscal or calendar year ending immediately | 1644 |
prior to the date on which the trust recognizes the gain or loss, | 1645 |
is available to the trust. | 1646 |
(b) The requirements of section 5747.011 of the Revised Code | 1647 |
are satisfied for the trust's taxable year in which the trust | 1648 |
recognizes the gain or loss. | 1649 |
Any gain or loss that is not a qualifying trust amount is | 1650 |
modified business income, qualifying investment income, or | 1651 |
modified nonbusiness income, as the case may be. | 1652 |
(3) "Modified nonbusiness income" means a trust's Ohio | 1653 |
taxable income other than modified business income, other than the | 1654 |
qualifying trust amount, and other than qualifying investment | 1655 |
income, as defined in section 5747.012 of the Revised Code, to the | 1656 |
extent such qualifying investment income is not otherwise part of | 1657 |
modified business income. | 1658 |
(4) "Modified Ohio taxable income" applies only to trusts, | 1659 |
and means the sum of the amounts described in divisions (BB)(4)(a) | 1660 |
to (c) of this section: | 1661 |
(a) The fraction, calculated under section 5747.013, and | 1662 |
applying section 5747.231 of the Revised Code, multiplied by the | 1663 |
sum of the following amounts: | 1664 |
(i) The trust's modified business income; | 1665 |
(ii) The trust's qualifying investment income, as defined in | 1666 |
section 5747.012 of the Revised Code, but only to the extent the | 1667 |
qualifying investment income does not otherwise constitute | 1668 |
modified business income and does not otherwise constitute a | 1669 |
qualifying trust amount. | 1670 |
(b) The qualifying trust amount multiplied by a fraction, the | 1671 |
numerator of which is the sum of the book value of the qualifying | 1672 |
investee's physical assets in this state on the last day of the | 1673 |
qualifying investee's fiscal or calendar year ending immediately | 1674 |
prior to the day on which the trust recognizes the qualifying | 1675 |
trust amount, and the denominator of which is the sum of the book | 1676 |
value of the qualifying investee's total physical assets | 1677 |
everywhere on the last day of the qualifying investee's fiscal or | 1678 |
calendar year ending immediately prior to the day on which the | 1679 |
trust recognizes the qualifying trust amount. If, for a taxable | 1680 |
year, the trust recognizes a qualifying trust amount with respect | 1681 |
to more than one qualifying investee, the amount described in | 1682 |
division (BB)(4)(b) of this section shall equal the sum of the | 1683 |
products so computed for each such qualifying investee. | 1684 |
(c)(i) With respect to a trust or portion of a trust that is | 1685 |
a resident as ascertained in accordance with division (I)(3)(d) of | 1686 |
this section, its modified nonbusiness income. | 1687 |
(ii) With respect to a trust or portion of a trust that is | 1688 |
not a resident as ascertained in accordance with division | 1689 |
(I)(3)(d) of this section, the amount of its modified nonbusiness | 1690 |
income satisfying the descriptions in divisions (B)(2) to (5) of | 1691 |
section 5747.20 of the Revised Code, except as otherwise provided | 1692 |
in division (BB)(4)(c)(ii) of this section. With respect to a | 1693 |
trust or portion of a trust that is not a resident as ascertained | 1694 |
in accordance with division (I)(3)(d) of this section, the trust's | 1695 |
portion of modified nonbusiness income recognized from the sale, | 1696 |
exchange, or other disposition of a debt interest in or equity | 1697 |
interest in a section 5747.212 entity, as defined in section | 1698 |
5747.212 of the Revised Code, without regard to division (A) of | 1699 |
that section, shall not be allocated to this state in accordance | 1700 |
with section 5747.20 of the Revised Code but shall be apportioned | 1701 |
to this state in accordance with division (B) of section 5747.212 | 1702 |
of the Revised Code without regard to division (A) of that | 1703 |
section. | 1704 |
If the allocation and apportionment of a trust's income under | 1705 |
divisions (BB)(4)(a) and (c) of this section do not fairly | 1706 |
represent the modified Ohio taxable income of the trust in this | 1707 |
state, the alternative methods described in division (C) of | 1708 |
section 5747.21 of the Revised Code may be applied in the manner | 1709 |
and to the same extent provided in that section. | 1710 |
(5)(a) Except as set forth in division (BB)(5)(b) of this | 1711 |
section, "qualifying investee" means a person in which a trust has | 1712 |
an equity or ownership interest, or a person or unit of government | 1713 |
the debt obligations of either of which are owned by a trust. For | 1714 |
the purposes of division (BB)(2)(a) of this section and for the | 1715 |
purpose of computing the fraction described in division (BB)(4)(b) | 1716 |
of this section, all of the following apply: | 1717 |
(i) If the qualifying investee is a member of a qualifying | 1718 |
controlled group on the last day of the qualifying investee's | 1719 |
fiscal or calendar year ending immediately prior to the date on | 1720 |
which the trust recognizes the gain or loss, then "qualifying | 1721 |
investee" includes all persons in the qualifying controlled group | 1722 |
on such last day. | 1723 |
(ii) If the qualifying investee, or if the qualifying | 1724 |
investee and any members of the qualifying controlled group of | 1725 |
which the qualifying investee is a member on the last day of the | 1726 |
qualifying investee's fiscal or calendar year ending immediately | 1727 |
prior to the date on which the trust recognizes the gain or loss, | 1728 |
separately or cumulatively own, directly or indirectly, on the | 1729 |
last day of the qualifying investee's fiscal or calendar year | 1730 |
ending immediately prior to the date on which the trust recognizes | 1731 |
the qualifying trust amount, more than fifty per cent of the | 1732 |
equity of a pass-through entity, then the qualifying investee and | 1733 |
the other members are deemed to own the proportionate share of the | 1734 |
pass-through entity's physical assets which the pass-through | 1735 |
entity directly or indirectly owns on the last day of the | 1736 |
pass-through entity's calendar or fiscal year ending within or | 1737 |
with the last day of the qualifying investee's fiscal or calendar | 1738 |
year ending immediately prior to the date on which the trust | 1739 |
recognizes the qualifying trust amount. | 1740 |
(iii) For the purposes of division (BB)(5)(a)(iii) of this | 1741 |
section, "upper level pass-through entity" means a pass-through | 1742 |
entity directly or indirectly owning any equity of another | 1743 |
pass-through entity, and "lower level pass-through entity" means | 1744 |
that other pass-through entity. | 1745 |
An upper level pass-through entity, whether or not it is also | 1746 |
a qualifying investee, is deemed to own, on the last day of the | 1747 |
upper level pass-through entity's calendar or fiscal year, the | 1748 |
proportionate share of the lower level pass-through entity's | 1749 |
physical assets that the lower level pass-through entity directly | 1750 |
or indirectly owns on the last day of the lower level pass-through | 1751 |
entity's calendar or fiscal year ending within or with the last | 1752 |
day of the upper level pass-through entity's fiscal or calendar | 1753 |
year. If the upper level pass-through entity directly and | 1754 |
indirectly owns less than fifty per cent of the equity of the | 1755 |
lower level pass-through entity on each day of the upper level | 1756 |
pass-through entity's calendar or fiscal year in which or with | 1757 |
which ends the calendar or fiscal year of the lower level | 1758 |
pass-through entity and if, based upon clear and convincing | 1759 |
evidence, complete information about the location and cost of the | 1760 |
physical assets of the lower pass-through entity is not available | 1761 |
to the upper level pass-through entity, then solely for purposes | 1762 |
of ascertaining if a gain or loss constitutes a qualifying trust | 1763 |
amount, the upper level pass-through entity shall be deemed as | 1764 |
owning no equity of the lower level pass-through entity for each | 1765 |
day during the upper level pass-through entity's calendar or | 1766 |
fiscal year in which or with which ends the lower level | 1767 |
pass-through entity's calendar or fiscal year. Nothing in division | 1768 |
(BB)(5)(a)(iii) of this section shall be construed to provide for | 1769 |
any deduction or exclusion in computing any trust's Ohio taxable | 1770 |
income. | 1771 |
(b) With respect to a trust that is not a resident for the | 1772 |
taxable year and with respect to a part of a trust that is not a | 1773 |
resident for the taxable year, "qualifying investee" for that | 1774 |
taxable year does not include a C corporation if both of the | 1775 |
following apply: | 1776 |
(i) During the taxable year the trust or part of the trust | 1777 |
recognizes a gain or loss from the sale, exchange, or other | 1778 |
disposition of equity or ownership interests in, or debt | 1779 |
obligations of, the C corporation. | 1780 |
(ii) Such gain or loss constitutes nonbusiness income. | 1781 |
(6) "Available" means information is such that a person is | 1782 |
able to learn of the information by the due date plus extensions, | 1783 |
if any, for filing the return for the taxable year in which the | 1784 |
trust recognizes the gain or loss. | 1785 |
(CC) "Qualifying controlled group" has the same meaning as in | 1786 |
section 5733.04 of the Revised Code. | 1787 |
(DD) "Related member" has the same meaning as in section | 1788 |
5733.042 of the Revised Code. | 1789 |
(EE)(1) For the purposes of division (EE) of this section: | 1790 |
(a) "Qualifying person" means any person other than a | 1791 |
qualifying corporation. | 1792 |
(b) "Qualifying corporation" means any person classified for | 1793 |
federal income tax purposes as an association taxable as a | 1794 |
corporation, except either of the following: | 1795 |
(i) A corporation that has made an election under subchapter | 1796 |
S, chapter one, subtitle A, of the Internal Revenue Code for its | 1797 |
taxable year ending within, or on the last day of, the investor's | 1798 |
taxable year; | 1799 |
(ii) A subsidiary that is wholly owned by any corporation | 1800 |
that has made an election under subchapter S, chapter one, | 1801 |
subtitle A of the Internal Revenue Code for its taxable year | 1802 |
ending within, or on the last day of, the investor's taxable year. | 1803 |
(2) For the purposes of this chapter, unless expressly stated | 1804 |
otherwise, no qualifying person indirectly owns any asset directly | 1805 |
or indirectly owned by any qualifying corporation. | 1806 |
(FF) For purposes of this chapter and Chapter 5751. of the | 1807 |
Revised Code: | 1808 |
(1) "Trust" does not include a qualified pre-income tax | 1809 |
trust. | 1810 |
(2) A "qualified pre-income tax trust" is any pre-income tax | 1811 |
trust that makes a qualifying pre-income tax trust election as | 1812 |
described in division (FF)(3) of this section. | 1813 |
(3) A "qualifying pre-income tax trust election" is an | 1814 |
election by a pre-income tax trust to subject to the tax imposed | 1815 |
by section 5751.02 of the Revised Code the pre-income tax trust | 1816 |
and all pass-through entities of which the trust owns or | 1817 |
controls, directly, indirectly, or constructively through related | 1818 |
interests, five per cent or more of the ownership or equity | 1819 |
interests. The trustee shall notify the tax commissioner in | 1820 |
writing of the election on or before April 15, 2006. The | 1821 |
election, if timely made, shall be effective on and after January | 1822 |
1, 2006, and shall apply for all tax periods and tax years until | 1823 |
revoked by the trustee of the trust. | 1824 |
(4) A "pre-income tax trust" is a trust that satisfies all of | 1825 |
the following requirements: | 1826 |
(a) The document or instrument creating the trust was | 1827 |
executed by the grantor before January 1, 1972; | 1828 |
(b) The trust became irrevocable upon the creation of the | 1829 |
trust; and | 1830 |
(c) The grantor was domiciled in this state at the time the | 1831 |
trust was created. | 1832 |
Section 4. That the existing version of section 5747.01 of | 1833 |
the Revised Code that is scheduled to take effect January 1, 2010, | 1834 |
is hereby repealed. | 1835 |
Section 5. Sections 3 and 4 of this act shall take effect | 1836 |
January 1, 2010. | 1837 |
Section 6. That Section 265.10 of Am. Sub. H.B. 1 of the | 1838 |
128th General Assembly be amended to read as follows: | 1839 |
Sec. 265.10. EDU DEPARTMENT OF EDUCATION | 1840 |
General Revenue Fund | 1841 |
GRF | 200100 | Personal Services | $ | 10,490,789 | $ | 10,723,972 | 1842 | ||||
GRF | 200320 | Maintenance and Equipment | $ | 3,110,071 | $ | 3,144,897 | 1843 | ||||
GRF | 200408 | Early Childhood Education | $ | 23,268,341 | $ | 23,268,341 | 1844 | ||||
GRF | 200416 | Career-Technical Education Match | $ | 2,233,195 | $ | 2,233,195 | 1845 | ||||
GRF | 200420 | Computer/Application/ Network Development | $ | 4,880,871 | $ | 4,880,871 | 1846 | ||||
GRF | 200421 | Alternative Education Programs | $ | 7,814,479 | $ | 7,918,749 | 1847 | ||||
GRF | 200422 | School Management Assistance | $ | 1,950,521 | $ | 3,230,469 | 1848 | ||||
GRF | 200424 | Policy Analysis | $ | 356,311 | $ | 361,065 | 1849 | ||||
GRF | 200425 | Tech Prep Consortia Support | $ | 1,243,943 | $ | 1,260,542 | 1850 | ||||
GRF | 200426 | Ohio Educational Computer Network | $ | 20,156,602 | $ | 20,425,556 | 1851 | ||||
GRF | 200427 | Academic Standards | $ | 5,300,074 | $ | 5,300,074 | 1852 | ||||
GRF | 200431 | School Improvement Initiatives | $ | 7,294,175 | $ | 7,391,503 | 1853 | ||||
GRF | 200437 | Student Assessment | $ | 55,954,648 | $ | 56,703,265 | 1854 | ||||
GRF | 200439 | Accountability/Report Cards | $ | 3,804,673 | $ | 3,804,673 | 1855 | ||||
GRF | 200442 | Child Care Licensing | $ | 865,590 | $ | 877,140 | 1856 | ||||
GRF | 200446 | Education Management Information System | $ | 13,199,152 | $ | 11,934,284 | 1857 | ||||
GRF | 200447 | GED Testing | $ | 975,536 | $ | 988,553 | 1858 | ||||
GRF | 200448 | Educator Preparation | $ | 1,310,750 | $ | 1,328,240 | 1859 | ||||
GRF | 200455 | Community Schools | $ | 1,000,000 | $ | 1,000,000 | 1860 | ||||
GRF | 200457 | STEM Initiatives | $ | 5,000,000 | $ | 5,000,000 | 1861 | ||||
GRF | 200458 | School Employees Health Care Board | $ | 800,000 | $ | 800,000 | 1862 | ||||
GRF | 200502 | Pupil Transportation | $ | 448,022,619 | $ | 462,822,619 | 1863 | ||||
GRF | 200505 | School Lunch Match | $ | 9,100,000 | $ | 9,100,000 | 1864 | ||||
GRF | 200511 | Auxiliary Services | $ | $ | 1865 | ||||||
GRF | 200532 | Nonpublic Administrative Cost Reimbursement | $ | $ | 1866 | ||||||
GRF | 200540 | Special Education Enhancements | $ | 134,150,233 | $ | 135,820,668 | 1867 | ||||
GRF | 200545 | Career-Technical Education Enhancements | $ | 7,752,662 | $ | 7,802,699 | 1868 | ||||
GRF | 200550 | Foundation Funding | $ | 5,130,669,418 | $ | 4,746,289,372 | 1869 | ||||
GRF | 200551 | Foundation Funding – Federal Stimulus | $ | 387,583,913 | $ | 457,449,362 | 1870 | ||||
GRF | 200578 | Violence Prevention and School Safety | $ | 200,000 | $ | 200,000 | 1871 | ||||
GRF | 200901 | Property Tax Allocation - Education | $ | 1,053,262,363 | $ | 1,020,655,157 | 1872 | ||||
TOTAL GRF General Revenue Fund | $ | $ | 1873 |
General Services Fund Group | 1874 |
1380 | 200606 | Computer Services-Operational Support | $ | 7,600,091 | $ | 7,600,091 | 1875 | ||||
4520 | 200638 | Miscellaneous Educational Services | $ | 275,000 | $ | 275,000 | 1876 | ||||
4L20 | 200681 | Teacher Certification and Licensure | $ | 8,013,206 | $ | 8,147,756 | 1877 | ||||
5960 | 200656 | Ohio Career Information System | $ | 529,761 | $ | 529,761 | 1878 | ||||
5H30 | 200687 | School District Solvency Assistance | $ | 18,000,000 | $ | 18,000,000 | 1879 | ||||
TOTAL GSF General Services | 1880 | ||||||||||
Fund Group | $ | 34,418,058 | $ | 34,552,608 | 1881 |
Federal Special Revenue Fund Group | 1882 |
3090 | 200601 | Educationally Disadvantaged Programs | $ | 8,405,512 | $ | 8,405,512 | 1883 | ||||
3670 | 200607 | School Food Services | $ | 6,324,707 | $ | 6,577,695 | 1884 | ||||
3680 | 200614 | Veterans' Training | $ | 778,349 | $ | 793,846 | 1885 | ||||
3690 | 200616 | Career-Technical Education Federal Enhancement | $ | 5,000,000 | $ | 5,000,000 | 1886 | ||||
3700 | 200624 | Education of Exceptional Children | $ | 2,664,000 | $ | 2,755,000 | 1887 | ||||
3740 | 200647 | Troops to Teachers | $ | 100,000 | $ | 100,000 | 1888 | ||||
3780 | 200660 | Learn and Serve | $ | 619,211 | $ | 619,211 | 1889 | ||||
3AF0 | 200603 | Schools Medicaid Administrative Claims | $ | 639,000 | $ | 639,000 | 1890 | ||||
3AN0 | 200671 | School Improvement Grants | $ | 17,909,676 | $ | 17,936,675 | 1891 | ||||
3AX0 | 200698 | Improving Health and Educational Outcomes of Young People | $ | 630,954 | $ | 630,954 | 1892 | ||||
3BK0 | 200628 | Longitudinal Data Systems | $ | 100,000 | $ | 0 | 1893 | ||||
3BV0 | 200636 | Character Education | $ | 700,000 | $ | 0 | 1894 | ||||
3C50 | 200661 | Early Childhood Education | $ | 14,189,711 | $ | 14,554,749 | 1895 | ||||
3CF0 | 200644 | Foreign Language Assistance | $ | 25,000 | $ | 0 | 1896 | ||||
3CG0 | 200646 | Teacher Incentive Fund | $ | 3,007,975 | $ | 1,157,834 | 1897 | ||||
3D10 | 200664 | Drug Free Schools | $ | 13,347,966 | $ | 13,347,966 | 1898 | ||||
3D20 | 200667 | Honors Scholarship Program | $ | 6,990,000 | $ | 6,985,000 | 1899 | ||||
3DJ0 | 200699 | IDEA Part B - Federal Stimulus | $ | 218,868,026 | $ | 218,868,026 | 1900 | ||||
3DK0 | 200642 | Title 1A - Federal Stimulus | $ | 186,336,737 | $ | 186,336,737 | 1901 | ||||
3DL0 | 200650 | IDEA Preschool - Federal Stimulus | $ | 6,679,679 | $ | 6,679,679 | 1902 | ||||
3DM0 | 200651 | Title IID Technology - Federal Stimulus | $ | 11,951,000 | $ | 11,951,000 | 1903 | ||||
3DP0 | 200652 | Title I School Improvement - Federal Stimulus | $ | 54,221,000 | $ | 54,221,000 | 1904 | ||||
3H90 | 200605 | Head Start Collaboration Project | $ | 225,000 | $ | 225,000 | 1905 | ||||
3L60 | 200617 | Federal School Lunch | $ | 295,421,000 | $ | 310,150,675 | 1906 | ||||
3L70 | 200618 | Federal School Breakfast | $ | 80,850,000 | $ | 84,892,500 | 1907 | ||||
3L80 | 200619 | Child/Adult Food Programs | $ | 89,250,000 | $ | 93,712,500 | 1908 | ||||
3L90 | 200621 | Career-Technical Education Basic Grant | $ | 48,029,701 | $ | 48,029,701 | 1909 | ||||
3M00 | 200623 | ESEA Title 1A | $ | 530,000,000 | $ | 530,010,000 | 1910 | ||||
3M10 | 200678 | Innovative Education | $ | 1,000,000 | $ | 0 | 1911 | ||||
3M20 | 200680 | Individuals with Disabilities Education Act | $ | 413,391,594 | $ | 421,241,163 | 1912 | ||||
3S20 | 200641 | Education Technology | $ | 9,487,397 | $ | 9,487,397 | 1913 | ||||
3T40 | 200613 | Public Charter Schools | $ | 14,275,618 | $ | 14,291,353 | 1914 | ||||
3Y20 | 200688 | 21st Century Community Learning Centers | $ | 36,000,000 | $ | 36,000,000 | 1915 | ||||
3Y40 | 200632 | Reading First | $ | 27,366,373 | $ | 24,455,172 | 1916 | ||||
3Y60 | 200635 | Improving Teacher Quality | $ | 101,778,397 | $ | 101,778,400 | 1917 | ||||
3Y70 | 200689 | English Language Acquisition | $ | 8,142,299 | $ | 8,142,299 | 1918 | ||||
3Y80 | 200639 | Rural and Low Income Technical Assistance | $ | 1,500,000 | $ | 1,500,000 | 1919 | ||||
3Z20 | 200690 | State Assessments | $ | 12,923,799 | $ | 12,923,799 | 1920 | ||||
3Z30 | 200645 | Consolidated Federal Grant Administration | $ | 8,499,279 | $ | 8,499,280 | 1921 | ||||
3Z70 | 200697 | General Supervisory Enhancement Grant | $ | 887,319 | $ | 0 | 1922 | ||||
TOTAL FED Federal Special | 1923 | ||||||||||
Revenue Fund Group | $ | 2,238,516,279 | $ | 2,262,899,123 | 1924 |
State Special Revenue Fund Group | 1925 |
4540 | 200610 | Guidance and Testing | $ | 450,000 | $ | 450,000 | 1926 | ||||
4550 | 200608 | Commodity Foods | $ | 24,000,000 | $ | 24,000,000 | 1927 | ||||
4R70 | 200695 | Indirect Operational Support | $ | 6,050,000 | $ | 6,250,000 | 1928 | ||||
4V70 | 200633 | Interagency Operational Support | $ | 1,111,838 | $ | 1,117,725 | 1929 | ||||
5980 | 200659 | Auxiliary Services Reimbursement | $ | 1,328,910 | $ | 1,328,910 | 1930 | ||||
5BB0 | 200696 | State Action for Education Leadership | $ | 1,250,000 | $ | 600,000 | 1931 | ||||
5BJ0 | 200626 | Half-Mill Maintenance Equalization | $ | 16,100,000 | $ | 16,600,000 | 1932 | ||||
5U20 | 200685 | National Education Statistics | $ | 300,000 | $ | 300,000 | 1933 | ||||
5W20 | 200663 | Early Learning Initiative | $ | 2,200,000 | $ | 2,200,000 | 1934 | ||||
5X90 | 200911 | NGA STEM | $ | 100,000 | $ | 0 | 1935 | ||||
6200 | 200615 | Educational Improvement Grants | $ | 3,000,000 | $ | 3,000,000 | 1936 | ||||
TOTAL SSR State Special Revenue | 1937 | ||||||||||
Fund Group | $ | 55,890,748 | $ | 55,846,635 | 1938 |
Lottery Profits Education Fund Group | 1939 |
7017 | 200612 | Foundation Funding | $ | 990,236,905 | $ | 1,277,271,428 | 1940 | ||||
TOTAL LPE Lottery Profits | 1941 | ||||||||||
Education Fund Group | $ | 990,236,905 | $ | 1,277,271,428 | 1942 |
Revenue Distribution Fund Group | 1943 |
7047 | 200909 | School District Property Tax Replacement-Business | $ | 1,150,207,366 | $ | 1,150,207,366 | 1944 | ||||
7053 | 200900 | School District Property Tax Replacement-Utility | $ | 91,123,523 | $ | 91,123,523 | 1945 | ||||
TOTAL RDF Revenue Distribution | 1946 | ||||||||||
Fund Group | $ | 1,241,330,889 | $ | 1,241,330,889 | 1947 | ||||||
TOTAL ALL BUDGET FUND GROUPS | $ | $ | 1948 |
Section 7. That existing Section 265.10 of Am. Sub. H.B. 1 | 1950 |
of the 128th General Assembly is hereby repealed. | 1951 |
Section 8. On the effective date of this section, or as soon | 1952 |
as possible thereafter, the Director of Budget and Management | 1953 |
shall transfer the cash balances in the OMVI Enforcement/Education | 1954 |
Fund (Fund 83G0), the Elementary School Seat Belt Program Fund | 1955 |
(Fund 83N0), and the Seat Belt Education Program Fund (Fund 8440), | 1956 |
which are used by the Department of Public Safety, to the General | 1957 |
Revenue Fund. | 1958 |
Section 9. Notwithstanding division (G)(5)(a) of section | 1959 |
4511.19 of the Revised Code, in fiscal year 2010 and fiscal year | 1960 |
2011, twenty-five dollars of the fine imposed under division | 1961 |
(G)(1)(a)(iii) of section 4511.19 of the Revised Code, thirty-five | 1962 |
dollars of the fine imposed under division (G)(1)(b)(iii) of | 1963 |
section 4511.19 of the Revised Code, one hundred twenty-three | 1964 |
dollars of the fine imposed under division (G)(1)(c)(iii) of | 1965 |
section 4511.19 of the Revised Code, and two hundred ten dollars | 1966 |
of the fine imposed under division (G)(1)(d)(iii) or (e)(iii) of | 1967 |
section 4511.19 of the Revised Code, shall be paid to the General | 1968 |
Revenue Fund. | 1969 |
Section 10. Notwithstanding divisions (E)(1) and (2) of | 1970 |
section 4513.263 of the Revised Code, in fiscal year 2010 and | 1971 |
fiscal year 2011, sixteen per cent of all fines collected for | 1972 |
violations of division (B) of section 4513.263 of the Revised | 1973 |
Code, or for violations of any ordinance or resolution of a | 1974 |
political subdivision that is substantively comparable to that | 1975 |
division, shall be deposited into the General Revenue Fund. The | 1976 |
remaining eighty-four per cent shall be distributed as specified | 1977 |
in divisions (E)(3), (4), and (5) of section 4513.263 of the | 1978 |
Revised Code. | 1979 |
Section 11. The uncodified sections of law contained in this | 1980 |
act, and the items of law of which the uncodified sections of law | 1981 |
contained in this act are composed, are not subject to the | 1982 |
referendum. Therefore, under Ohio Constitution, Article II, | 1983 |
Section 1d and section 1.471 of the Revised Code, the uncodified | 1984 |
sections of law contained in this act, and the items of law of | 1985 |
which the uncodified sections of law contained in this act are | 1986 |
composed, go into immediate effect when this act becomes law. | 1987 |