FROM: Stanley J. Bowers, Tax Commissioner

DATE: September 4, 1957

RE: Legislation Affecting New Taxpayers and Additional Charge

NEW TAXPAYERS

Section 5711.03 of the Ohio Revised Code now reads in part as follows:

" * * *. When a person or taxpayer engages in business on or after the first day of January, in any year, he shall list all his taxable property, except inventory, as to value, ownership and taxing districts as of the date he engages in business. In listing inventory as to ownership and taxing districts he shall list the probable average value intended to be used in business from the date he engages in business until the first day of January next thereafter. The valuation of all property, including average inventory, to be re-turned for taxation shall be determined by multiplying the value, or the average value of such property by a fraction whose numerator is the number of full months engaged in business during the year of engaging in business, and whose denominator is twelve, unless he shows the assessor, under oath, and by producing a copy of the return or assessment, that the same property has been listed or assessed for taxation for said year in this state."

Because of the importance of uniformly assessing all new taxpayers this County Auditor Bul1etin is being released to call to your attention the changes made in Section 5711.03 of the Ohio Revised Code which became effective August 15, 1957. Hereafter, when a person or taxpayer engages in-business after the first day of January he will be required to file a return on a fractional basis as indicated in the above paragraph and must make such return within ninety days after commencing such business. As an example, a taxpayer who engages in business on August 21, 1957, will be required to file a 1957 tax return on or before November 18, 1957, and will apportion the values in such return on the basis of four twelfths (4/12) in that he will be in business only four full months during the year 1957.

ADDITIONAL CHARGE

Section 5711. 27 of the Ohio Revised Code now reads in part as follows:

"*****If any taxpayer does so fail, the assessor shall add to the assessment of each class or item of taxable property which the taxpayer failed to return, list or disclose in addition to the penalties provided by law, an additional charge at the rate of one-half of one per cent per month from the date such property should have been returned or disclosed until the same is assessed, provided that such additional charge shall not be added to an assessment for any period of time in excess of ten years previous to the date of assessment. * * *"

Effective September 7, 1957, this Section requires that an additional charge over and above the applicable penalties in the amount of one-half of one per cent per month will be added to all tax returns where a taxpayer has failed to make a return, list or disclose in a return any taxable property. This additional charge shall be added for each month after the effective date of the statute. It is important to note that no additional charge will be assessed for the period prior to the effective date of the statute and the number of months to be considered in determining the total additional charge will begin on October 1, 1957, the first full month after the change in the statute becomes effective.