Local taxes

[sbaltzer]

This is the first time I have ever ran across this, but the current city I work in is 1.5% and the municipality I live in is 1% but they only allow a credit of .5% of the 1% liability.  Is this legal?  I would understand if I moved to a community that was 2% and only had 1.5% that I make up the .5% but never heard of only giving a partial of the local as credit.

[Anonymous · Accepted solution]

see a lawyer. our opinion doesn't really matter. if I had to guess I would say it's legal. 

[sbaltzer]

Thanks and after more digging it appears that this is now becoming the norm for even more than bedroom communities.

[xmasbaby0]

@sbaltzer You did not mention where you live and work.  The situation you describe is entirely possible.  I prepare a tax return every year for a relative in Ohio who works in an Ohio town that has a 1% income tax that is withheld from his pay; he lives in a town that has a 2% income tax. The town he lives in gives credit for the 1% he paid already, and he ends up paying 1% to the town where he lives. He pays it quarterly to avoid a big bill at tax time.

[sbaltzer]

Thanks @xmasbaby0 , I live in Beach City, OH (1%) and Work in Dover, OH (1.5%).  I have also dug a little deeper and found that other municipalities are doing the same double taxing also so now I just have to plan for that additional .5% to pay next year.