§ 311-29. Collection at Source; Pass-through Entity.
Latest version.
For tax years beginning prior to January 1, 2016, and except as otherwise provided
in this Section 311-29, a pass-through entity that conducts business within the Municipality must withhold
municipal income tax at the rate specified in Section 311-3 on each owner's distributive share of the pass-through entity's net profits attributable
to the Municipality and remit such tax to the tax commissioner by the applicable dates
provided in Section 311-37. A pass-through entity subject to this section shall use the form prescribed by the
tax commissioner to return and remit municipal income tax withheld. Such pass-through
entity shall be required to file a return and remit any withheld municipal income
tax that remains outstanding as of the date specified in Section 311-41. A pass-through entity subject to this section that fails to collect or remit municipal
income tax as provided herein shall be liable for the tax that it should have withheld
or remitted and shall be subject to the interest and penalty provisions of Sections 311-73, 311-75 and 311-999. The resident and nonresident owners shall receive a credit against their municipal
income tax liabilities in the amount of the tax so withheld by the pass-through entity
on their respective distributive shares of the pass-through entity's net profit. All
claims for refund of municipal income tax withheld by a pass-through entity pursuant
to this section must be made by the owner within the period set forth in Section 311-71.
A pass-through entity is not required to withhold and remit municipal income tax to
the extent that its owners both file municipal income tax returns and declarations
as provided in Sections 311-51 and 311-37, respectively, that report their distributive shares of the pass-through entity's
net profits attributable to the Municipality; and pay municipal income tax thereon
to the Municipality.
