The City of Hillsboro, Ohio

Q: Why does Hillsboro have an income tax?

A: To provide funds for operations, maintenance and other things as outlined in the Municipal Income Tax Ordinance Section 35.01.

Q: Who needs to file?

A: All Hillsboro residents are required to file an income tax return annually, even if no tax is due.  Non-resident individuals, sole proprietorships, partnerships, limited partnerships, limited liability companies, limited liability partnerships, associations, corporations, and S corporations that own rental properties, conduct business, perform services, solicit sales, operate or maintain an office in Hillsboro must file, even if no tax is due. Non-residents who work in the city are not required to file, unless the tax has not been withheld from their pay. 

Q:  Is there a minimum age requirement to file?

Effective with 2024 tax year, all residents aged 18 and older must file and pay tax in the city.  Tax years 2023 and prior had no minimum age requirement. 

Q:  Do retirees need to file? 

Retired individuals who no longer have taxable income may be exempt from filing after notifying and providing a copy of their benefit letter to the Tax Department.   

Q: What documents are required?

A: W2-s, W2g-s, Schedule C, E, or F, 1099-s, 1099-MISC, 1099-NEC, Federal 1040 (first five pages), Schedule K, Schedule K-1, Form 1065, Form 1120 etc., or any additional documentation relating to income.

Q:  What are some of the types of income that are taxable to Hillsboro?

A:  Types of income include, but are not limited to:

·         Wages, salaries and other compensation

·         Bonuses, stipends and tip

·         Commissions, fees, earned income

·         Vacation pays

·         Profit sharing

·         Supplemental unemployment benefits from employer

·         Partnership, estate and trust income

·         Strike pay income

·         Employee contributions made to retirement plans and tax deferred annuity plans

·         Employer paid premiums for group term life insurance

·         Stock options

·         Severence pay

·         Director fees

·         Executor fees

·         Union steward fees

·         Net rental income

·         Net farm income

·         Net profit for businesses, sole proprietorships individuals who provide a service, personnel and professions

·         Mobile business income

·         Contractor, subcontractor, engineer pay

·         Gambling and lottery winnings (no deductions for gambling losses)

Q:  What types of income does not need to be reported?

A:  Types of income that doesn’t need to be reported:

·         Social security (Provide benefit letter)

·         Pension income (Provide benefit letter)

·         Interest and dividend

·         Welfare (Provide benefit letter)

·         State unemployment

·         Life insurance proceeds

·         Alimony

·         Third party sick pay

·         Capital gains

·         Active duty and reserve military pay

·         Income for persons under the age of 18

Q: What box on my W2 is considered the taxable/qualifying wages?  The federal, Medicare and local income box show different figures.

A: Because of some of the different federal deferral programs, taxable wages may be different for federal, local and Medicare boxes. For Ohio city tax purposes, "qualifying wages" generally refers to the greater of either your Medicare wages (Box 5 on your W-2) or your local taxable wages (Box 18).

Q: What is the income tax rate for Hillsboro?

A: Tax rate is 1.5%

Q: What is the deadline for filing?

A: The filing is the same as for federal and state.  April 15th.  Fiscal year accounts must be filed four months from the end of the fiscal year.

Q:  If I filed a request for an extension, why did I get charged a penalty when I filed and paid my tax due by the extension date?

Your extension only extends the time to file your tax return.  It does not extend the due date for the tax liability.

Q: I work in another city and they withhold money for tax there.  Do I still have to pay for Hillsboro tax?

A: We give credit for tax paid to other municipalities only (counties are excluded); up to 1.5% but we will need a copy of all W2-s for other cities.

Q: I only lived in Hillsboro for a few months.  Do I have to pay for the whole year?

A: Tax is based on time that you lived in Hillsboro, unless you worked in the city the full year.

Q: I claim a loss on my income tax.  How many years can it be carried forward?

A: Operating loss can be carried forward for 5 years.  Please refer to section 35.07 of the Income Tax Ordinance.

Q: Can a loss be taken off of my W2 wages to show a lower income?

A: No

Q: What form of payment is accepted?

A: Cash, Check, money orders, and most Debit/Credit cards. We also offer online payments. 

Q:  How long does it take to get my refund?

A:  We issue refunds within 90 days of receipt of the completed tax return which must have all supporting documentation.  Requests for refunds of $10 or less will not be issued.

Q: Does Hillsboro Income Tax office share my information?

A: No.  All taxpayer information is confidential.  Refer to Section 35.21

Q:  Is my employer required to withhold Hillsboro tax for me?

A:  If your employer is located in the city limits, they are required to withhold Hillsboro tax.  If not, you can request that they withhold for Hillsboro.  However, they are not required to withhold as a courtesy for you, if they are located outside of Hillsboro.  You can make estimated payments to Hillsboro based on last year’s tax liability.