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Dec 06

Majority of Grandview Heights residents will see local income taxes reduced in Tax Year 2017

Posted on December 6, 2016 at 11:42 AM by Laura Oldham

Grandview Heights City Council has passed legislation that enhances the tax credit offered to residents who work outside the City.

Effective January 1, 2017 (Tax Year 2017) residents employed outside the City will receive a municipal income tax credit of up to 2.5% of the taxes they pay to the community where they work.

In the case of most of those residents, this means they will not owe the City of Grandview Heights any additional income tax, because the tax credit matches the city income tax rate of 2.5%.

Am I benefited by this change?

1.) Yes, if you work in a municipality with a tax rate of 2.5%. This includes Columbus, Upper Arlington, Bexley, Worthington, Obetz, and Whitehall.
2.) No, if you are a resident working in the City of Grandview Heights, or in a municipality with a local income tax rate of less than 2.5%.

Example

Previously, there was a maximum 2.25% credit eligible for work done in other 2.5% taxing municipalities. The maximum has now been raised to 2.5% providing full credit, so you no longer owe the .25% difference to the City of Grandview Heights.

Before:
Municipality tax rate (for example income of $50,000):
2.5% of $50,000 = $1,250
Previously not covered by credit:
0.25% of $50,000 = $125
Total taxes owed: $1,375

Now:
Municipality tax rate:
2.5% of $50,000 = $1,250
Total taxes owed: $1,250


What should I do if I am affected by this change?

1.) Cancel Withholding: If you previously established a courtesy withholding account with your non-Grandview Heights employer, contact your payroll department to cancel your courtesy withholding. This will eliminate an unnecessary income tax overpayment and the need to file for a refund later.
2.) Reduce Estimated Payments: If you did not have courtesy withholding but made estimated payments during the year, you may be able to reduce your 2017 estimated payments by a comparable amount. For some residents, if this income earned outside the City was the only reason estimated payments were made, you may be able to eliminate estimated payments altogether.

For more resources on Grandview Heights Income Tax policies:

Grandview Heights Finance Department
Income Tax section
Frequently Asked Questions
Income Tax Ordinance


Scott Gill
Tax Accountant
sgill@grandviewheights.org
614-481-6207

Download the press release regarding the tax legislation passed December 5th here.

GH Tax Legislation for social media FINAL