Instructions For Form Kr-1040 - Kettering Individual Income Tax Return

CITY OF KETTERING TAX DIVISION

KETTERING INDIVIDUAL

P. O. Box 293100 • Kettering, Ohio 45429-9100

INCOME TAX RETURN

Telephone (937) 296-2502 • Fax (937) 296-3242

Forms are available on the internet at

GENERAL INFORMATION

Income Tax Rate Change

Where and When To File: Your city tax return (Form KR-1040) must be filed

on or before April 16, 2007. Make checks or money orders payable to the City

In May of 2006 the voters of the City of Kettering approved an increase in the

of Kettering and mail to: City of Kettering Income Tax Division, P.O. Box

city’s income tax rate from 1.75% to 2.25% effective January 1, 2007. This

293100, Kettering, OH 45429-9100. If the balance due with your return is

means that any taxable income earned or received or won after December 31,

less than $1.00, no payment need accompany the return.

2006 will be subject to tax at the new rate of 2.25%. If you are subject to

estimated payment requirements, you will need to increase your payments in

Extensions: Taxpayers can request an extension of time in which to file their

2007 to cover the higher rate. Please note that those individuals who have

Kettering Income Tax Return by submitting a copy of their federal extension

not had to pay estimated tax payments prior to 2007 may now be required to

request to the Tax Division on or before the original due date of the return.

do so because of the increase in the city’s income tax rate. To learn more

The extended due date of the municipal income tax return shall be the last

about your filing requirements please refer to the Estimated Tax Payments

day of the month following the month to which the due date of the federal

section below.

income tax return has been extended. Payment of any tax liability must

accompany the extension request since an extension of time to file is not an

Who Must File:

extension of time to pay the tax due. If no extension is filed, penalty and interest

charges will apply. If estimated tax payment requirements are not met,

Residents: All Kettering residents 18 years of age or older with taxable

penalty and interest charges will apply as if no extension had been approved.

income are subject to Kettering income tax regardless of where their income

is earned. Credit is given for income tax withheld and/or paid to another

Refunds: Refunds will be issued only for amounts overpaid of $1.00 or more.

municipality, not to exceed 1.75%. The only exception to this filing

Refunds are allowed only when city income tax has actually been paid to or

requirement is for residents whose only source of taxable income is from

withheld for Kettering. Refunds may be requested using the Income Tax Return

wages and whose employers have correctly withheld Kettering tax (1.75%)

(Form KR- 1040). In addition, requests for refunds of withholding tax overpaid

from their gross wages.

to Kettering for any reason (i.e., days out of town, tax withheld in excess of

liability, employee moved during the year, employee did not work in Kettering,

Non-Residents: Non-residents earning income (including salaries, wages,

employee was under age 18, etc.) must include the City of Kettering Refund

compensation or profits which result from work performed, services

Request Form. You may obtain the Refund Request Form and Instructions by

rendered, business transacted or activities located within the City of

calling our office or by visiting our website.

Kettering) which is not subject to the withholding of Kettering tax.

Note: A written request for a refund must be filed within three (3) years from

Under 18: If you were under the age of 18, and had Kettering tax withheld from

the date the taxes were due or the payment was made, whichever is later.

your wages, you may file a request for a refund. Refund Request forms and

instructions may be obtained by calling our office or by visiting our website.

Other Income or Loss Calculation:

Part Year Residents: If you are a part-year resident who is required to file a

All Income earned other than wage income, including income or loss from

return, your return should cover the time period of your residency. Report the

self-employment, rentals, partnerships, and any other activity must be netted

amount of income you earned while you lived in Kettering. Pay statements

together with the income or loss from these (same) activities to arrive at an

with year to date figures or a statement from your payroll department must be

overall net profit or loss for the current year. If the netting results in a net loss,

used if available. When the actual amount you earned while living in Kettering

the loss may be carried forward for a period not to exceed three (3) years.

cannot be determined, you may break down your earnings by the number of

Note that when determining the amount of loss from self-employment, rentals

months employed at the job arriving at a monthly earnings figure. Use the

and partnerships to be included in the netting process, the City of Kettering

monthly earnings multiplied by the number of months of residency to find

does not recognize passive loss limitations. Thus, the full loss before any fed-

your taxable amount. If you pro-rate your income, you must also pro-rate

eral passive loss limitation should be included in the netting process.

your city tax that was withheld on the same income. Attach a worksheet

explaining your calculations.

If any portion of the income or loss of an activity is separately reportable for

municipal tax purposes to another taxing entity, the income or loss may or

Taxable and Non-Taxable Income:

may not be included in the netting process. The general guidelines to use in

making this determination are as follows:

Taxable income includes, but is not limited to qualifying wages, salaries,

commissions and other compensation including sick pay, vacation pay,

Business Activity Location:

income from wage continuation plans (includes retirement incentive plans

and buyouts), contributions made by or on behalf of employees to a tax

• Kettering

The loss from such activity may be offset against

deferred annuity plan (401K plans and the like), bonuses, directors fees, fringe

the profits of unincorporated activities taxable for

benefits such as car allowance, disability pay if received as a benefit from

Kettering purposes.

employment (includes third party plan), stock options, gambling winnings,

• City with a tax rate

The loss MAY NOT be offset against the profits

and the net profits from the operation of a business, profession, enterprise or

greater than or

of unincorporated activities taxable to Kettering,

other activity.

equal to Kettering’s

as the profits from those activities would be taxed

Non-taxable income includes: interest, dividends, military pay and

rate of 1.75%

in full to the other city.

allowances, Social Security benefits, welfare benefits, unemployment

insurance benefits, workers’ compensation, proceeds from qualified

• City with a tax

The portion of the loss attributable to the

retirement plans as defined by the IRS, personal earnings of all persons under

rate less than

difference in rates would be offset against the

eighteen (18) years of age, capital gains, royalties, alimony, and contributions

Kettering’s

profits of unincorporated activities taxable to

to a Section 125 (cafeteria) plan or flexible spending account.

rate of 1.75%.

Kettering because if the activity had a profit,

Kettering would receive the tax for the difference

S-Corporations: Distributions from S-Corporations are not taxed at the

in rates. The formula to be used is:

individual level. S-Corporations doing business in Kettering must file a City of

Kettering Business Tax Return (Form KBR-1040).

Loss Allowed

Kettering rate – other city tax rate x Loss

Kettering rate

Estimated Tax Payments: Individual taxpayers who expect to receive

taxable income, which is not subject to withholding at a rate equal to or

Note: that the same formula is used to determine the portion of income from

greater than 2.25%, are required to make quarterly estimated tax payments

a taxable business activity which can be offset by a loss allowed in Kettering.

when their tax liability exceeds $200.00. Taxpayers must have 90% of their

Income which

Kettering rate – other city tax rate x Income

current year tax liability or 100% of their previous year’s tax liability paid

can be offset by

Kettering rate

through quarterly estimated tax payments and withholding (if applicable)

a loss allowed

by January 31 of the following year. Quarterly estimated tax payments are

in Kettering

due on or before April 15, July 31, October 31, and January 31. The first

estimated tax form is found at the bottom of the income tax return. Estimated

Disclaimer: Definitions and instructions are illustrative only. The City of

payment vouchers for the second, third and fourth quarters are included

Kettering Income Tax Code and the Ohio Revised Code supersede any

with your annual income tax return package or can be obtained from the

interpretation presented.

city’s website.

Instructions For Form Kr-1040 - Kettering Individual Income Tax Return - 2007

Related Articles

Related forms

Related Categories