Returns

5:01 Returns and Requirements

A. Annual Return Requirements-Each taxpayer, whether an individual, corporation or unincorporated business entity, subject to the provisions of Section 2:01 through 2:07 of the Regulations, shall file a return or returns, as necessary, setting forth the aggregate amount of salaries, wages, commissions and other personal service compensation; net profits from business or other activities, including the rental from use of real and personal property; and the income taxable under the Ordinance for the period covered by the return or returns and pertinent facts and information.

B. Who need not file an annual return:

1. Any person who has no income need not file an annual return. Any person who has exempt income must file a return and declare to the Administrator the nature of his exemption. Any person who has taxable income must file a tax return with the Tax Administrator.

2. A non-resident individual of this municipality who is employed in this municipality and had withheld at the source equal to the existing tax rate of the Village of Cadiz need not file an annual return as set forth in Section 5:01.A of these Regulations.

C. Dates and Requirements for Annual Returns-except as provided in Section 5:01.B on or before April 15 of the year following the effective date of the Ordinance, each taxpayer, whether an individual, corporation or unincorporated business entity subject to the provisions of Section 2:01 through 2:07 of these Regulations, must make and file with the Administrator a return on a form prescribed by and obtainable either through the internet, or upon request, or by using any generic form containing required filing information whether or not a tax is due.

D. Fiscal Year Account-If the annual return is made for a fiscal year or any period less than one year, said return shall be made within four (4) months from the end of each fiscal year or other period.

E. Declarations of Estimated Tax Return-Except as provided in Section 5:01.F, on or before April 15 of the year following the effective date of the Ordinance and on or before April 15th of the year thereafter, each taxpayer, whether an individual, corporation or unincorporated business entity subject to the provisions of Section 2:01 through 2:07 of these Regulations, must make and file with the Administrator an estimated tax return. If an estimate is not filed, an estimated tax may be filed by the Administrator if there is reason to believe an estimate will be owed.

F. Taxpayers who need not file an estimated return:

1. A taxpayer, who resides in the Village of Cadiz and who is employed exclusively within this municipality and withheld at the source equal to the existing tax rate of this municipality on all taxable income, need not file an estimated tax return as set forth in Section 5:01.E of these Regulations.

2. A taxpayer, who resides in the Village of Cadiz and who has municipal taxes withheld at a source outside this municipality equal to the existing tax rate on all taxable income, need not file an estimated tax return as set forth in Section 5:01.E of these Regulations.

3. A taxpayer, who has no taxable income (see Sections 4:01 through 4:12 of these Regulations), need not file an estimated tax return as set forth in Section 5:01.E of these Regulations.

4. A non-resident, who is employed in the Village of Cadiz and withheld at the source equal to the existing tax rate of this municipality need not file an estimated tax return as set forth in Section 5:01.E of these Regulations. 

 G. Non-reimbursed Business and Moving Expenses-An individual taxpayer residing in the Village of Cadiz who is permitted for federal income tax purposes to deduct certain business expenses from gross wages, salaries or commissions (IRC Section 62), may file a copy of Federal Income Tax Form 2106 or an itemized statement of expenses with his municipal tax return claiming only deductions allowable under Part 1 of Form 2106, no matter whether all or part of such wages, salaries or commissions are subject to withholding. Items reported on the 2106 but deductible on Schedule A of Federal Form 1040 may not be deducted when filing an annual tax return. Expenses attributable to moving that are deductible for federal tax purposes may be deducted if incurred after residency has been established or, if reimbursement was included in W-2 and the total reimbursement was included as involved income earned while a resident of the Village of Cadiz.

H. Resident Combined Return-An individual taxpayer residing in this municipality who has taxable compensation (salary, wages, etc.) and who also has a distributive share of net profit or loss from an unincorporated business entity or total ownership of an unincorporated business entity, the net profit of which is wholly or partly subject to taxation by the Village of Cadiz (or would be so subject if net profits existed), must report the taxable compensation and business net profit or loss on the same return. However, whether or not such compensation and net profit or loss are combined on one return, the following rules are to be applied:

1. There is to be no offset of business losses against wages and other employee compensation unless otherwise stated by the Ordinance.

2. In computing the tax on unincorporated business entities:

a. A business loss may be offset against business net profit in the same municipality.

b. A business loss in one municipality may not be offset against business net profits in another municipality except when allowed under the Ordinance.

 c. For the Village of Cadiz tax, a business loss in a non-taxing municipality may not offset net profits in this municipality and, alternatively, net profits in a non-taxing municipality may not offset a business loss in this municipality.

d. For the Village of Cadiz tax, income shall include the aggregate of all business losses and gains in all other taxing municipalities in which it operates.

I. Joint Filing- A husband and wife may file, in any tax year, a joint return. Husband and wife are liable jointly and severally for payment of the tax associated with the joint return. A husband and wife's tax return shall be deemed a joint return whenever the facts indicate that the taxpayers intended to have the filed tax return to be a joint return. Conclusive indications of such intention include when the husband and wife both signed the tax return, when the return reports both spouses' income or when the husband and wife were both required to file tax returns, but only one spouse filed a tax return.

J. Partnerships and Other Unincorporated Businesses- The tax is on the partnership or other unincorporated business as an entity, whether resident or non-resident, and a return is required disclosing the net profits allocable to this municipality and the tax paid thereon (see Sections 2:03 and 2:04 of these Regulations). In addition, any resident partner or member of any unincorporated entity is required to make a return and pay the tax on income allocable outside this municipality in accordance with Sections 2:03.E and 2:04.D hereof.

K. Fiduciary Returns- Trustee of trusts and executors and administrators of estates having income taxable under the Ordinance are required to file returns and pay the tax thereon; (also see Section 5:01.J of these Regulations.

5:02 Information Required and Reconciliation With Federal Returns for Individuals or Businesses.

A. Information-In returns filed hereunder, there shall be set forth the aggregate amount of salaries, wages, bonuses, incentive payments, commissions, fees and other compensation subject to the tax earned from each employer, taxable net profits, and other pertinent information as the Administrator may require.

 B. Items Not Taxable or Deductible-Where figures of total income, total deductions and net profits are included as shown by a federal return, then any items of income as are not subject to Village of Cadiz income tax and unallowable expenses shall be eliminated in determining net income subject to the tax. The fact that any taxpayer is not required to file a federal income tax return does not relieve him from filing a return for the Village of Cadiz.

C. Changes on return:

1.If a change in federal income tax liability as finally determined by the Federal Internal Revenue Service or by a judicial decision results in an additional amount of tax payable to the Village of Cadiz, a report of such change shall be filed by the taxpayer within three (3) months from the final determination of federal tax liability.

2.If a change in federal income tax liability results in a reduction of taxes owed and paid to this municipality, a claim for refund shall be filed with the Administrator as prescribed in these Regulations.

Extensions

A. Requests-Any taxpayer that has requested an extension for filing federal income tax return may request an extension for the filing of Village of Cadiz income tax return. The taxpayer shall make the request by filing a copy of the taxpayer's request for a federal filing extension with the Administrator. The request for extension shall be filed not later than April 15. The request may be denied if the taxpayer fails to file the request timely, owes the Village of Cadiz any delinquent income tax or penalty, interest assessment or other charge for the late payment or non-payment of tax, or has failed to file required return, report or other related document for a prior tax period. The granting of an extension for filing does not extend the last date for paying the tax without penalty unless the Village of Cadiz grants an extension of that date.

B. Automatic-In cases where an automatic four (4) month extension has been granted by the Internal Revenue Service, an automatic extension is granted by the Administrator once a copy of the request has been received from the taxpayer. The request must be filed no later than April 15. 

 C. Payment Requirement-In cases where a balance is due on such annual return, the total of the estimated balance is due at the time the extension is filed. No penalty or interest will be assessed in those cases in which the return is filed and the final tax paid within the period as extended, provided all other filing and payment requirements of the Ordinance have been met.

D. Supplemental Documents-Information returns, schedules and statements needed to support tax returns are to be filed within the time limits set forth for filing the tax returns and made a part thereof.

5:03 Consolidated Returns

A. General-The filing of consolidated returns shall be limited to corporations filing estimated net profit returns and annual net profit returns.

B. Who May File a Consolidated Return-Consolidated returns may be filed by a group of corporations who are affiliated through stock ownership and who join in the filing of a federal consolidated income tax return. A consolidated return must include all subsidiaries which are includable members of an "affiliated group" as defined in the Federal Consolidated Returns Regulation.

C. Discontinuing Filing Consolidated Returns- When a consolidated return has been filed for any taxable year, the consolidated group must continue to file consolidated returns in subsequent years unless:

1. Permission is writing is granted by the Administrator to file separate returns; or

2. The affiliated group terminates in such manner that a federal consolidated income tax return is no longer required; or

3. Permission in writing has been granted by the Commissioner of Internal Revenue to discontinue filing a federal consolidated income tax return.

D. Corporation Entering or Leaving an Affiliated Group-If a corporation becomes a member of the affiliated group during the taxable year, or if a corporation ceases to be a member of the affiliated group during that taxable year, the consolidated return must include the income of each subsidiary for the portion of the year during which it was a member of the affiliated group as computed in accordance with the Federal Consolidated Return Regulations.

E. Apportionment Fractions-In determining the apportionment fraction where a corporation becomes a member of the group, or ceases to be a member of the group during the taxable year, the property fraction shall be determined on the basis of the average net book value of the property during the period such corporation was a member of the group. The rental portion of the fraction, however, shall be computed at eight (8) times the rent during this period. The gross receipt and wage fractions shall be based upon actual figures.

F. Common Consent-All subsidiary corporations must agree in writing to the filing of the consolidated return. They will be liable jointly and severally for the tax as will be the parent corporation. The consent to file a consolidated return must be filed with the initial consolidated return on or before the due date for filing, including extensions of time within which to file the return.

G. Loss Carryover Limitations-The net operating loss carryover of a corporation which filed a separate return in a prior year may be carried over to a consolidated return year in the same manner permitted by the Internal Revenue Code. For the purposes of this rule to the extent that the loss can only be carried forward to the same corporation's taxable net income, the net income attributable to the Village of Cadiz in a year a loss is being utilized shall be computed by using only the same corporation's net income and apportionment methods.

H. Computing Net Income-In consolidating the net income, the taxable income of each corporation shall be computed in accordance with the provisions governing the taxable income of separate corporations except that unrealized profits and losses in transactions between members of the affiliated group shall be eliminated in the same manner and amount as computed in accordance with Federal Consolidated Income Tax Return Regulations.

For taxable years beginning on or after January 1, 2004, "net Profit" means adjusted federal taxable income calculated on the basis of the Internal Revenue Code.

I. Non-deductible Expense Rule-In determining expenses that are not allowable because they are allocable to non-taxable income, such calculations shall be based on the consolidated net income.

 5:04 Apportionment of Net Profits by Administrator

A. In the case of a corporation that carried on transactions with its stockholders or with other corporations related by stock ownership, interlocking directorates, or some other method, or in case any person operates a division, branch, factory, office, laboratory or activity within a taxing municipality constituting a portion only of its total business, the Administrator shall require such additional information as he may deem necessary to ascertain whether net profits are not properly allocated to said taxing municipality. If the Administrator finds that net profits are not properly allocated to said taxing municipality by reason of transactions with stockholders or with other corporations related by stock ownership, interlocking directorates or transactions with such division, branch, factory, office, laboratory or activity or by some other method, he shall make such apportionment as he deems appropriate to produce a fair and proper apportionment as he deems appropriate of adjusted federal taxable income.

5:05 Amended Returns

A. Where necessary, an amended return must be filed in order to report additional income and pay any additional tax due or claim a refund of tax overpaid subject to the requirements or limitations contained in the Ordinance. Such return shall be clearly marked "Amended". A taxpayer may not change the method of accounting or apportionment of the net profits after the due date for filing the original return. Amended returns cannot be filed after three (3) years from the original filing date.