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- Proposed 1% Income (Earnings) Tax Legislation
Proposed 1% Income Tax
The income tax code Ordinance 20-09 was passed by City Council on June 22, 2020 after three readings and public input. The Ordinance became effective July 23, 2020. On July 27, 2020, Resolution 20-17 was passed unanimously by City Council to place the income tax on the November 3, 2020 ballot for voter consideration. If approved by the voters in November 2020, the income tax would not become effective until January 1, 2022.
The purpose of the income (earnings) tax is to reduce city property taxes and sole reliance on it by utilizing the income tax method, which collects revenues from non-residents thus helping reduce the current funded burden of City services on residents and property owners. Under Ohio law, city income taxes are paid first to the city where the employees work. If the city where the employee works does not have an income tax, then taxes are collected and sent to the city in which the commuter lives. Based on recent census, approximately 75% of employees working in Beavercreek live in surrounding communities.
On approval of the 1% income tax by a majority of the electors voting on the tax, the current voted 3.4 mill Street levy would NOT be renewed and would expire on December 31, 2021 (Income Tax would not be effective until January 1, 2022). The purpose of the income tax is to provide funds for purposes of general municipal operations, maintenance, equipment, municipal services and facilities, infrastructure, and capital improvements in the City of Beavercreek. The revenue currently generated by the voted 3.4 mill levy will be appropriated annually to replace the funds of the expiring levy.
Facts about the Proposed Income Tax:
- Reduces city property taxes for all property owners. Reduction by allowing the voted 3.4 mill Street levy to expire in 2021. Reduction of about $101.46 per $100k of home value per year.
- All persons working in Beavercreek will pay the income tax. The income tax will require all persons working in Beavercreek to pay the tax, including those persons who do not live in Beavercreek. An estimated 75% of all persons working in Beavercreek are non-residents. Residents who work somewhere without an income tax will also pay the tax.
- Retirement income is exempt. This includes pension income, social security benefits, active military pay, intangible income; dividends, interest, capital gains, alimony and child support received and unemployment compensation.
- Residents paying income taxes to other cities will receive 100% credit (up to the 1% rate). Section 39.081 provides for full credit up to 1% for municipal income tax paid to another city.
Income Tax Calculation Estimator:
The income tax calculation estimator will allow you to calculate how the proposed income tax will impact you. Enter your employment location, income, and Greene County Auditor’s appraised value of your property and the calculator will calculate how the proposed income tax will affect you.
Other references and Information:
Please see links to the following information:
- Income Tax Calculation Estimator
- FAQ – Frequently Asked Questions
- In Touch Special Edition
- Ordinance and Income Tax Code
- Income Tax Presentations to City Council Videos
- List of Exempt Income from the Income Tax
- Taxable Income
- History and City Comparison
- 2020 Municipal Budget
- 2020-2024 Five-Year Capital Improvement Plan
- Council Meeting Income Tax PowerPoint Presentations
- Annual Local Government Costs
- Residential Property Taxes
- Area City Tax Rates
- Where do each dollar of your property tax go?