April 2011 Newsletter
Article
Financial Outlook Presentation
Emergency Levy Letter of Intent from Auditor Michael L.
Smith
1% Income Tax / Emergency Levy Reduction
The Board realizes and understands the economic conditions and
difficulties facing the community and our families. Therefore, the Board
wanted to offer an income tax / levy option that would benefit both the
community and the District. At the July 18th, 2011 special
meeting the District voted 4-0 to place a one percent (1%) income tax on
the November ballot. The Ohio Department of Taxation has certified that
the 1% income tax would raise approximately $2 million for the District.
In combination with the income tax the Board voted 4-0 to reduce the
existing emergency levy in the event the income tax passes. The emergency
levy collects $2.1 million dollars, which equates to a current effective
millage rate of 9.3. If successful, the emergency levy would be reduced to
$1.1 million with an effect rate of approximately 5 mills. This would
result in a reduction of 4.3 mills for all property owners within the
District. The following information can be used to help determine your
property savings and obligation under the income tax.
Step 1:
|
Home Value
|
Assessed Value 35%
|
Millage Reduction (4.3)
|
Reduction
|
Rollback**
|
Total Rollback
|
|
(
“ _______” X
|
.35
X
|
.0043)
=
|
|
X
.125
=
|
|
** Use 12.5% is used for owner-occupied homesteads
Step 2:
To determine the total savings in property taxes, take the reduction from
step 1 and subtract the total rollback from step 1.
|
Reduction
|
Total Rollback
|
Total Savings
|
|
-
|
=
|
|
Examples
|
Home Value
|
Assessed Value 35%
|
Millage Reduction
|
Reduction
|
Rollback
|
Total Savings
|
|
$100,000
|
$35,000
|
4.3
|
$150.50
|
$18.81
|
$131.69
|
|
$120,000
|
$42,000
|
4.3
|
$180.60
|
$22.58
|
$158.03
|
|
$140,000
|
$49,000
|
4.3
|
$210.70
|
$26.34
|
$184.36
|
|
$160,000
|
$56,000
|
4.3
|
$240.80
|
$30.10
|
$210.70
|
|
$180,000
|
$63,000
|
4.3
|
$270.90
|
$33.86
|
$237.04
|
|
$200,000
|
$70,000
|
4.3
|
$301.00
|
$37.63
|
$263.38
|
·
Home Value –
The value of real property determined by the county auditor during the
reappraisal process. Home value (Total Market Value) can be found by
visiting the Licking, Know, and Delaware Counties Auditor’s Office
web-sites.
o
Licking County:
http://www.lcounty.com/auditor/
o
Knox County:
http://www.knoxcountyauditor.org/
o
Delaware County:
http://www.co.delaware.oh.us/auditor/
·
Assessed Value
– Thirty-five percent of the home value is used when calculating property
tax bills.
·
Millage Reduction
– The Northridge Local School District Board of Education has committed to
reduce the existing emergency levy by $1,000,000 if the 1% income tax
passes in November. There would be a reduction of approximately 4.3 mills
based on current valuations.
·
Reduction
– This represents the savings a home owner would receive before
calculating rollback.
·
Rollback
– The state pays the equivalent of 12.5% of local millage to school
districts for owner-occupied homesteads.
·
Total Savings
– A homeowner would see a net reduction based on the total calculation.
Estimating
Traditional Income Tax (1%)
Please visit the Ohio Department of Taxations website for a comprehensive
description on how and what is calculate for the income tax.
http://tax.ohio.gov/divisions/tax_analysis/tax_data_series/school_district_data/documents/sditqa.pdf
Guide to Ohio’s School District Income Tax
“The school district income tax, as originally designed, uses the same
income base as the state’s income tax. A simple way to determine taxable
income using this base is to look at line 5 of the state return. For those
less familiar with the state return, line 5 is federal adjusted gross
income (taken from the front page of the federal return) plus or minus
Ohio adjustments to income and minus personal exemptions. Adjustments are
made on the state return because not all types of income that are taxed by
the federal government are taxed by the state. For example, Ohio allows
the deduction of all social security benefits while the federal government
does not. The following list shows some of the types of income, which are
and are not taxable. For further detail, consult current federal and state
returns. Income that is not taxed: social security benefits; disability
and survivors benefits; railroad retirement benefits; welfare benefits;
child support; property received as a gift, bequest or inheritance; and
workers’ compensation benefits. Income that is taxed: wages; salaries;
tips; interest; dividends; unemployment compensation; self-employment;
taxable scholarships and fellowships; pensions; annuities; IRA
distributions; capital gains; state and local bond interest (except that
paid by Ohio governments); federal bond interest exempt from federal tax
but subject to state tax; alimony received; and all other sources.”
Since an income tax and an emergency levy cannot be on as a single ballot
issue, the only item to be voted on in November will be the income tax.
Should the income tax pass, the District has already committed to the
emergency levy reduction by iling the resolution of intent with the
respective County Auditors.
If you have any questions please call the District office at (740)
967-6631.
Thanks you for your support,
Jim Hudson
Treasurer
