Bill Text: OH HB396 | 2013-2014 | 130th General Assembly | Introduced

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Bill Title: To allow married couples to elect to file either separate state tax returns or a joint state return, irrespective of their federal filing status, and to declare an emergency.

Spectrum: Partisan Bill (Republican 3-0)

Status: (Introduced - Dead) 2013-12-23 - To Ways and Means [HB396 Detail]

Download: Ohio-2013-HB396-Introduced.html

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As Introduced

130th General Assembly Regular Session 2013-2014

H. B. No. 396

Representative Becker 

Cosponsors: Representatives Hood, Stebelton 

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A BILL

To amend section 5747.08 of the Revised Code to allow

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married couples to elect to file either separate

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state tax returns or a joint state return,

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irrespective of their federal filing status, and

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to declare an emergency.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1.  That section 5747.08 of the Revised Code be	6
amended to read as follows:	7

Sec. 5747.08.  An annual return with respect to the tax	8
imposed by section 5747.02 of the Revised Code and each tax	9
imposed under Chapter 5748. of the Revised Code shall be made by	10
every taxpayer for any taxable year for which the taxpayer is	11
liable for the tax imposed by that section or under that chapter,	12
unless the total credits allowed under divisions (E), (F), and (G)	13
of section 5747.05 of the Revised Code for the year are equal to	14
or exceed the tax imposed by section 5747.02 of the Revised Code,	15
in which case no return shall be required unless the taxpayer is	16
liable for a tax imposed pursuant to Chapter 5748. of the Revised	17
Code.	18

(A) If an individual is deceased, any return or notice	19
required of that individual under this chapter shall be made and	20
filed by that decedent's executor, administrator, or other person	21
charged with the property of that decedent.	22

(B) If an individual is unable to make a return or notice	23
required by this chapter, the return or notice required of that	24
individual shall be made and filed by the individual's duly	25
authorized agent, guardian, conservator, fiduciary, or other	26
person charged with the care of the person or property of that	27
individual.	28

(C) Returns or notices required of an estate or a trust shall	29
be made and filed by the fiduciary of the estate or trust.	30

(D)(1)(a) Except as otherwise provided in division (D)(1)(b)	31
of this section, any pass-through entity may file a single return	32
on behalf of one or more of the entity's investors other than an	33
investor that is a person subject to the tax imposed under section	34
5733.06 of the Revised Code. The single return shall set forth the	35
name, address, and social security number or other identifying	36
number of each of those pass-through entity investors and shall	37
indicate the distributive share of each of those pass-through	38
entity investor's income taxable in this state in accordance with	39
sections 5747.20 to 5747.231 of the Revised Code. Such	40
pass-through entity investors for whom the pass-through entity	41
elects to file a single return are not entitled to the exemption	42
or credit provided for by sections 5747.02 and 5747.022 of the	43
Revised Code; shall calculate the tax before business credits at	44
the highest rate of tax set forth in section 5747.02 of the	45
Revised Code for the taxable year for which the return is filed;	46
and are entitled to only their distributive share of the business	47
credits as defined in division (D)(2) of this section. A single	48
check drawn by the pass-through entity shall accompany the return	49
in full payment of the tax due, as shown on the single return, for	50
such investors, other than investors who are persons subject to	51
the tax imposed under section 5733.06 of the Revised Code.	52

(b)(i) A pass-through entity shall not include in such a	53
single return any investor that is a trust to the extent that any	54
direct or indirect current, future, or contingent beneficiary of	55
the trust is a person subject to the tax imposed under section	56
5733.06 of the Revised Code.	57

(ii) A pass-through entity shall not include in such a single	58
return any investor that is itself a pass-through entity to the	59
extent that any direct or indirect investor in the second	60
pass-through entity is a person subject to the tax imposed under	61
section 5733.06 of the Revised Code.	62

(c) Nothing in division (D) of this section precludes the tax	63
commissioner from requiring such investors to file the return and	64
make the payment of taxes and related interest, penalty, and	65
interest penalty required by this section or section 5747.02,	66
5747.09, or 5747.15 of the Revised Code. Nothing in division (D)	67
of this section precludes such an investor from filing the annual	68
return under this section, utilizing the refundable credit equal	69
to the investor's proportionate share of the tax paid by the	70
pass-through entity on behalf of the investor under division (J)	71
of this section, and making the payment of taxes imposed under	72
section 5747.02 of the Revised Code. Nothing in division (D) of	73
this section shall be construed to provide to such an investor or	74
pass-through entity any additional deduction or credit, other than	75
the credit provided by division (J) of this section, solely on	76
account of the entity's filing a return in accordance with this	77
section. Such a pass-through entity also shall make the filing and	78
payment of estimated taxes on behalf of the pass-through entity	79
investors other than an investor that is a person subject to the	80
tax imposed under section 5733.06 of the Revised Code.	81

(2) For the purposes of this section, "business credits"	82
means the credits listed in section 5747.98 of the Revised Code	83
excluding the following credits:	84

(a) The retirement credit under division (B) of section	85
5747.055 of the Revised Code;	86

(b) The senior citizen credit under division (C) of section	87
5747.05 of the Revised Code;	88

(c) The lump sum distribution credit under division (D) of	89
section 5747.05 of the Revised Code;	90

(d) The dependent care credit under section 5747.054 of the	91
Revised Code;	92

(e) The lump sum retirement income credit under division (C)	93
of section 5747.055 of the Revised Code;	94

(f) The lump sum retirement income credit under division (D)	95
of section 5747.055 of the Revised Code;	96

(g) The lump sum retirement income credit under division (E)	97
of section 5747.055 of the Revised Code;	98

(h) The credit for displaced workers who pay for job training	99
under section 5747.27 of the Revised Code;	100

(i) The twenty-dollar personal exemption credit under section	101
5747.022 of the Revised Code;	102

(j) The joint filing credit under division (G) of section	103
5747.05 of the Revised Code;	104

(k) The nonresident credit under division (A) of section	105
5747.05 of the Revised Code;	106

(l) The credit for a resident's out-of-state income under	107
division (B) of section 5747.05 of the Revised Code;	108

(m) The low-income credit under section 5747.056 of the	109
Revised Code;	110

(n) The earned income tax credit under section 5747.71 of the	111
Revised Code.	112

(3) The election provided for under division (D) of this	113
section applies only to the taxable year for which the election is	114
made by the pass-through entity. Unless the tax commissioner	115
provides otherwise, this election, once made, is binding and	116
irrevocable for the taxable year for which the election is made.	117
Nothing in this division shall be construed to provide for any	118
deduction or credit that would not be allowable if a nonresident	119
pass-through entity investor were to file an annual return.	120

(4) If a pass-through entity makes the election provided for	121
under division (D) of this section, the pass-through entity shall	122
be liable for any additional taxes, interest, interest penalty, or	123
penalties imposed by this chapter if the tax commissioner finds	124
that the single return does not reflect the correct tax due by the	125
pass-through entity investors covered by that return. Nothing in	126
this division shall be construed to limit or alter the liability,	127
if any, imposed on pass-through entity investors for unpaid or	128
underpaid taxes, interest, interest penalty, or penalties as a	129
result of the pass-through entity's making the election provided	130
for under division (D) of this section. For the purposes of	131
division (D) of this section, "correct tax due" means the tax that	132
would have been paid by the pass-through entity had the single	133
return been filed in a manner reflecting the commissioner's	134
findings. Nothing in division (D) of this section shall be	135
construed to make or hold a pass-through entity liable for tax	136
attributable to a pass-through entity investor's income from a	137
source other than the pass-through entity electing to file the	138
single return.	139

(E) If a husband and wife file a joint federal income tax	140
return for a taxable year, they shallmay elect to file a joint	141
return or separate returns under this section for that taxable	142
year, and, pursuant to that election, their liabilities are	143
separate if they file separate returns or joint and several, but,	144
if they file a joint return. If the federal income tax liability	145
of either spouse is determined on a separate federal income tax	146
return, they shall file separate returns under this section.	147

Ifor if either spouse is not required to file a federal	148
income tax return and either or both are required to file a return	149
pursuant to this chapter, they may elect to file separate or joint	150
returns, and, pursuant to that election, their liabilities are	151
separate or joint and several. If a husband and wife file separate	152
returns pursuant to this chapter, each must claim the taxpayer's	153
own exemption, but not both, as authorized under section 5747.02	154
of the Revised Code on the taxpayer's own return.	155

(F) Each return or notice required to be filed under this	156
section shall contain the signature of the taxpayer or the	157
taxpayer's duly authorized agent and of the person who prepared	158
the return for the taxpayer, and shall include the taxpayer's	159
social security number. Each return shall be verified by a	160
declaration under the penalties of perjury. The tax commissioner	161
shall prescribe the form that the signature and declaration shall	162
take.	163

(G) Each return or notice required to be filed under this	164
section shall be made and filed as required by section 5747.04 of	165
the Revised Code, on or before the fifteenth day of April of each	166
year, on forms that the tax commissioner shall prescribe, together	167
with remittance made payable to the treasurer of state in the	168
combined amount of the state and all school district income taxes	169
shown to be due on the form.	170

Upon good cause shown, the commissioner may extend the period	171
for filing any notice or return required to be filed under this	172
section and may adopt rules relating to extensions. If the	173
extension results in an extension of time for the payment of any	174
state or school district income tax liability with respect to	175
which the return is filed, the taxpayer shall pay at the time the	176
tax liability is paid an amount of interest computed at the rate	177
per annum prescribed by section 5703.47 of the Revised Code on	178
that liability from the time that payment is due without extension	179
to the time of actual payment. Except as provided in section	180
5747.132 of the Revised Code, in addition to all other interest	181
charges and penalties, all taxes imposed under this chapter or	182
Chapter 5748. of the Revised Code and remaining unpaid after they	183
become due, except combined amounts due of one dollar or less,	184
bear interest at the rate per annum prescribed by section 5703.47	185
of the Revised Code until paid or until the day an assessment is	186
issued under section 5747.13 of the Revised Code, whichever occurs	187
first.	188

If the commissioner considers it necessary in order to ensure	189
the payment of the tax imposed by section 5747.02 of the Revised	190
Code or any tax imposed under Chapter 5748. of the Revised Code,	191
the commissioner may require returns and payments to be made	192
otherwise than as provided in this section.	193

To the extent that any provision in this division conflicts	194
with any provision in section 5747.026 of the Revised Code, the	195
provision in that section prevails.	196

(H) If any report, claim, statement, or other document	197
required to be filed, or any payment required to be made, within a	198
prescribed period or on or before a prescribed date under this	199
chapter is delivered after that period or that date by United	200
States mail to the agency, officer, or office with which the	201
report, claim, statement, or other document is required to be	202
filed, or to which the payment is required to be made, the date of	203
the postmark stamped on the cover in which the report, claim,	204
statement, or other document, or payment is mailed shall be deemed	205
to be the date of delivery or the date of payment.	206

If a payment is required to be made by electronic funds	207
transfer pursuant to section 5747.072 of the Revised Code, the	208
payment is considered to be made when the payment is received by	209
the treasurer of state or credited to an account designated by the	210
treasurer of state for the receipt of tax payments.	211

"The date of the postmark" means, in the event there is more	212
than one date on the cover, the earliest date imprinted on the	213
cover by the United States postal service.	214

(I) The amounts withheld by an employer pursuant to section	215
5747.06 of the Revised Code, a casino operator pursuant to section	216
5747.063 of the Revised Code, or a lottery sales agent pursuant to	217
section 5747.064 of the Revised Code shall be allowed to the	218
recipient of the compensation casino winnings, or lottery prize	219
award as credits against payment of the appropriate taxes imposed	220
on the recipient by section 5747.02 and under Chapter 5748. of the	221
Revised Code.	222

(J) If a pass-through entity elects to file a single return	223
under division (D) of this section and if any investor is required	224
to file the annual return and make the payment of taxes required	225
by this chapter on account of the investor's other income that is	226
not included in a single return filed by a pass-through entity or	227
any other investor elects to file the annual return, the investor	228
is entitled to a refundable credit equal to the investor's	229
proportionate share of the tax paid by the pass-through entity on	230
behalf of the investor. The investor shall claim the credit for	231
the investor's taxable year in which or with which ends the	232
taxable year of the pass-through entity. Nothing in this chapter	233
shall be construed to allow any credit provided in this chapter to	234
be claimed more than once. For the purpose of computing any	235
interest, penalty, or interest penalty, the investor shall be	236
deemed to have paid the refundable credit provided by this	237
division on the day that the pass-through entity paid the	238
estimated tax or the tax giving rise to the credit.	239

(K) The tax commissioner shall ensure that each return	240
required to be filed under this section includes a box that the	241
taxpayer may check to authorize a paid tax preparer who prepared	242
the return to communicate with the department of taxation about	243
matters pertaining to the return. The return or instructions	244
accompanying the return shall indicate that by checking the box	245
the taxpayer authorizes the department of taxation to contact the	246
preparer concerning questions that arise during the processing of	247
the return and authorizes the preparer only to provide the	248
department with information that is missing from the return, to	249
contact the department for information about the processing of the	250
return or the status of the taxpayer's refund or payments, and to	251
respond to notices about mathematical errors, offsets, or return	252
preparation that the taxpayer has received from the department and	253
has shown to the preparer.	254

(L) The tax commissioner shall permit individual taxpayers to	255
instruct the department of taxation to cause any refund of	256
overpaid taxes to be deposited directly into a checking account,	257
savings account, or an individual retirement account or individual	258
retirement annuity, or preexisting college savings plan or program	259
account offered by the Ohio tuition trust authority under Chapter	260
3334. of the Revised Code, as designated by the taxpayer, when the	261
taxpayer files the annual return required by this section	262
electronically.	263

(M) The tax commissioner may adopt rules to administer this	264
section.	265

Section 2.  That existing section 5747.08 of the Revised Code	266
is hereby repealed.	267

Section 3.  The amendment by this act of section 5747.08 of	268
the Revised Code applies to taxable years beginning in 2013 or	269
thereafter.	270

Section 4.  This act is hereby declared an emergency measure	271
necessary for the immediate preservation of the public peace,	272
health, and safety. The reason for such necessity is to enable	273
taxpayers to take advantage of the changes made in the act when	274
filing their income tax returns for the 2013 taxable year.	275
Therefore, this act takes immediate effect.	276