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Multistate Tax Alert: City of Akron announces Tax Amnesty starting March 5, 2012

Every business with a location in Akron or one of its JEDDS1, or an employer who has an employee working in Akron or one of its JEDDs, is required to withhold individual tax from its employees working there. In addition, each business with a location in Akron or one of its JEDDs, is subject to the business net profits tax imposed by the city. In order to encourage taxpayer compliance, the City of Akron and its JEDDs are offering a Tax Amnesty program starting March 5, 2012 through May 4, 2012.

Who is eligible?

  • Taxpayers who did not file a required return for tax year 2010 and prior tax years
  • Taxpayers who need to amend a previously filed tax return
  • Taxpayers who have an outstanding tax liability
  • Taxpayers who have accounts referred for legal action

This includes employers, employees, businesses, the self-employed, independent contractors, consultants, and people who work from home. Nonresidents of Akron or one of its JEDDs who work in Akron or one of its JEDDs are also eligible for the Tax Amnesty.

How to participate

Follow these three easy steps by May 4, 2012:

  • Determine tax liability
  • Complete all required returns and/or current tax bills
  • Remit full payment of tax due and interest — Hardship cases may allow for payment plans in certain circumstances

If you are uneasy about this process, we can assist you in evaluating its benefits and risks, as well as work with you in completing the amnesty process.

What are the benefits of participation?

Tax Amnesty is a one-time opportunity for businesses and individuals who owe City of Akron or one of its JEDDs taxes to file tax returns by paying the tax and interest due, without penalties being assessed. After the Amnesty period is complete, the City has indicated that it will be increasing its efforts to locate and assess delinquent taxpayers, including matching information with IRS records, State of Ohio data, and other information sources.

Our multistate tax attorneys have experience consulting on all types of state and local tax compliance and controversy matters. Our firm has addressed municipal income tax issues in all of Ohio’s major cities, as well as many smaller municipalities throughout Ohio. We would be happy to assist you in determining the benefits of this program.

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A JEDD occurs when two or more municipal corporations (typically a City and a Township) enter into an agreement under the Ohio Revised Code for the purpose of facilitating new or expanded growth for commercial or economic development in the state. Under the agreement, a resident or non-resident business or individual may become subject to taxation in a similar manner as described above. The City of Akron has entered into four agreements including: Bath-Akron-Fairlawn JEDD, Copley-Akron JEDD, Coventry-Akron JEDD, and Springfield-Akron JEDD.

For more information, please contact:

Stephen K. Hall
614.458.0026
shall@mcdonaldhopkins.com

Adam L. Garn
614.458.0032
agarn@mcdonaldhopkins.com

Multistate Tax

Businesses must be vigilant and careful in managing their state and local tax liabilities and exposures. This can be a daunting task. We provide a broad range of state and local tax services to our clients, including tax planning, tax controversy, real estate tax abatement and exemption, and tax policy advocacy. With attorneys who have worked both inside and outside government agencies, our multistate tax team leverages its knowledge and experience for the benefit of our clients.

Carl J. Grassi, President
600 Superior Avenue, East, Suite 2100, Cleveland, Ohio 44114
Chicago
312.280.0111
Fax: 312.280.8232
Cleveland
216.348.5400
Fax: 216.348.5474
Columbus
614.458.0025
Fax: 614.458.0028
Detroit
248.646.5070
Fax: 248.646.5075
Miami
1.305.704.3990
Fax: 1.305.704.3999
West Palm Beach
561.472.2121
Fax: 561.472.2122
IRS CIRCULAR 230 DISCLOSURE: To ensure compliance with requirements imposed by the Internal Revenue Service, we inform you that any tax advice contained in this communication (including any attachments), was not intended or written to be used, and cannot be used, by any taxpayer for the purpose of (1) avoiding any penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any transaction matter addressed herein.

© 2012 McDonald Hopkins LLC All Rights Reserved. This Alert is designed to provide current information for our clients, friends and their advisors regarding important legal developments. The foregoing discussion is general information rather than specific legal advice. Because it is necessary to apply legal principles to specific facts, always consult your legal advisor before using this discussion as a basis for a specific action.