Mason, Ohio | faqs about business and withholding taxes

faqs: business income tax

What is the business tax rate in Mason?

The tax rate is one and twelve one-hundredths of a percent (1.12%). For tax years 2012 and prior, the tax rate was 1%.

Who must pay the business income tax?

Corporations
Unincorporated businesses (i.e. sole proprietorships, rental properties, partnerships, farm income)
Trusts and estates
Professions derived from work done, services performed or rendered, and business or other activities conducted in the City of Mason
Business conducted by non-residents for work done or services performed in the city

Am I required to withhold Mason municipal taxes from my employees?

Yes, if you are located within or doing business within the City of Mason and you employ one or more persons, whether as an employee, officer, director or otherwise. Each employer shall be liable for the payment of the tax required to be deducted and withheld, whether or not such tax, in fact, has been withheld. Withholding is required on all salary, wages, compensation, and profits that result from work performed in the city, and should be withheld at the time(s) such compensation is paid to the employees.

What types of income are taxable?

Net profits, as shown on the federal tax return, are subject to Mason income tax. A copy of your federal return must be included with your Mason return.

What is the due date for filing returns?

BR – Annual Return Calendar Year Filers: April 15 (or Federal and State due date) Fiscal Year Filers: 105 days after the end of the fiscal year

What if I miss the due date?

Interest shall be imposed at the rate calculated based on the federal short-term rate, rounded to the nearest whole number per cent, plus five percent per annum on all unpaid income tax, unpaid estimated income tax, and unpaid withholding tax. Interest shall be charged per month, or fraction of a month.
With respect to unpaid income tax and unpaid estimated income tax, a penalty equal to fifteen percent of the amount not timely paid shall be imposed
With respect to returns other than estimated income tax returns, the Municipality shall impose a monthly penalty of twenty-five dollars for each failure to timely file each return, regardless of the liability shown thereon for each month, or any fraction thereof, during which the return remains unfiled regardless of the liability shown thereon. The penalty shall not exceed a total of one hundred fifty dollars in assessed penalty for each failure to timely file a return.

If I overpay my taxes, can I get a refund?

Yes. The overpayment amount will be figured on your Mason tax return. Beginning tax year 2016, the amount of overpayment refunded or credited to the next year must be greater than $10. You may request a refund check by filling out the appropriate entries on the tax return.

Can I get an extension of the filing deadline?

An extension may be requested by any business or individual unable to complete their tax return by the deadline. Forms are available online. Beginning with tax year 2016, obtaining a federal extension will automatically extend your Mason due date to the approved federal due date. However, the federal government does not share information with the City of Mason, so it is recommended that this form or a Mason Extension Request Form ER be completed and remitted to the City. Extensions may not exceed six months or beyond any extension requested of or granted by the Internal Revenue Service.

Can a return be amended after it is filed?

Yes. An amended return must be filed to report additional income and to pay any additional tax due, or to claim a refund of overpaid taxes

How are payments applied to my account?

All payments are first applied to interest charges, then penalties in the order in which they were assessed, then against past due taxes in the order in which they became due, and then against all current taxes due.

How do I obtain the appropriate Mason Tax forms?

Click here for forms or contact the Tax Office at 513.229.8535.

faqs: withholding taxes for your employees

Am I required to withhold Mason municipal taxes from my employees?

How often are withholding payments due?

Monthly. The Tax Commissioner may authorize quarterly payments if the monthly payments average less than $200 per month.

My employee says he is not required to file a federal return. Should I still withhold Mason taxes?

Yes. Even if an employee is not required to file a federal tax return, he must still have Mason taxes withheld.

What types of income are taxable?

Medicare Exempt Employees are subject to the requirements for “qualifying wages” in box 5 of the Form W-2 even though that box will remain blank.
401(k), 457, and Supplemental Unemployment Compensation Benefits should be included in Box 5 and are subject to withholding requirements.
Nonqualified Deferred Compensation Plan income is included in the definition of “qualifying wages” at the time the income is deferred and is subject to withholding requirements.
Stock option income is included in the definition of “qualifying wages” and is subject to withholding requirements.
Disqualifying Disposition of an Incentive Stock Option income is not required for withholding, but it is considered “qualifying wages” and the recipient is liable for the tax.
Cafeteria Plans (IRC Section 125) are not included in the definition of Medicare wages and are not taxable.

What forms will I be required to file?

Unless paying electronically, W-1 Employer’s Withholding Tax Return statements must accompany all withholding payments. In addition, a W-3 Withholding Tax Reconciliation statement is due annually and must be accompanied by copies of the W-2 for each employee.

Can I submit my withholding forms electronically?

Yes. The City of Mason will accept CDs in lieu of paper W-2s. The CD specifications must conform to the Social Security Administration’s Magnetic Media Reporting format. Virus scan the CD before submission. Be sure to label each CD with:

Company Name
Federal ID Number
City Account Number<./li>
Tax Reporting Year
For multiple diskettes, indicate the proper sequence (i.e. Disk 2 of 3, etc.)

What are the due dates for filing withholding?

W-1 Withholding Tax Return
Monthly Filers: On or before the 15th day of the following month Quarterly Filers: April 30, July 31, October 31, and January 31

W-3 – Withholding Tax Reconciliation
All Filers: On or before February 28

Can I get an extension of the filing deadline?

No. Penalties will be assessed for late payments.

What if I miss the due date?
For all tax years beginning on or after January 1, 2016:

Interest shall be imposed at the rate calculated based on the federal short-term rate, rounded to the nearest whole number per cent, plus five percent per annum on all unpaid income tax, unpaid estimated income tax, and unpaid withholding tax. Interest shall be charged per month, or fraction of a month.
With respect to any unpaid withholding tax, a penalty equal to fifty percent of the amount not timely paid shall be imposed.
With respect to returns other than estimated income tax returns, the Municipality shall impose a monthly penalty of twenty-five dollars for each failure to timely file each return, regardless of the liability shown thereon for each month, or any fraction thereof, during which the return remains unfiled regardless of the liability shown thereon. The penalty shall not exceed a total of one hundred fifty dollars in assessed penalty for each failure to timely file a return.

Can I submit my withholding payments electronically?
Yes. In fact, for most employers, the withholding must be submitted to the city through the ACH Credit Electronic Filing Program. You can register for this program by completing and returning the ACH authorization form. The city also accepts electronic payment via the Ohio Business Gateway.

How do I obtain the appropriate Mason tax forms?
Click here for forms or contact the Tax Office at 513.229.8535.