130th Ohio General Assembly
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H. B. No. 326  As Introduced
As Introduced

128th General Assembly
Regular Session
2009-2010
H. B. No. 326


Representatives Hottinger, Grossman 

Cosponsors: Representatives Blair, Boose, Morgan, Adams, J., Jordan, Combs, Amstutz, Uecker, Wagner, Wachtmann, Hackett, Bubp 



A BILL
To amend sections 5731.02, 5731.21, and 5731.48 and to enact sections 5731.55 and 5731.56 of the Revised Code to reduce the estate tax, to authorize townships and municipal corporations, or electors thereof by initiative, to exempt from the estate tax any estate property located in the township or municipal corporation, and to distribute all estate tax revenue originating in a township or municipal corporation that does not exempt property from the tax to the township or municipal corporation.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 5731.02, 5731.21, and 5731.48 be amended and sections 5731.55 and 5731.56 of the Revised Code be enacted to read as follows:
Sec. 5731.02.  (A)(1) A tax is hereby levied on the transfer of the taxable estate, determined as provided in section 5731.14 of the Revised Code, of every person dying on or after July 1, 1968, who at the time of death was a resident of this state,. The tax on estates of persons dying before January 1, 2010, is as follows:
If the taxable estate is: The tax shall be:
Not over $40,000 2% of the taxable estate
Over $40,000 but not over $100,000 $800 plus 3% of the excess over $40,000
Over $100,000 but not over $200,000 $2,600 plus 4% of the excess over $100,000
Over $200,000 but not over $300,000 $6,600 plus 5% of the excess over $200,000
Over $300,000 but not over $500,000 $11,600 plus 6% of the excess over $300,000
Over $500,000 $23,600 plus 7% of the excess over $500,000.

(2) The tax on estates of persons dying on or after January 1, 2010, is as follows:
(a) For an estate with a taxable value of three hundred sixty-six thousand two hundred fifty dollars or less, no tax;
(b) For all other estates, the tax computed under division (A)(1) of this section multiplied by eighty per cent.
(B) A nonrefundable credit shall be allowed against the tax imposed by division (A) of this section equal to the lesser of five hundred dollars or the amount of the tax for persons dying on or after July 1, 1968, but before January 1, 2001; the lesser of six thousand six hundred dollars or the amount of the tax for persons dying on or after January 1, 2001, but before January 1, 2002; or the lesser of thirteen thousand nine hundred dollars or the amount of the tax for estates of persons dying on or after January 1, 2002 before January 1, 2010; or the lesser of fifteen thousand five hundred seventy-five dollars or the amount of the tax for estates of persons dying on or after January 1, 2010. In December of each year, beginning in 2011, the tax commissioner shall compute the percentage increase in the consumer price index for all urban consumers (United States city average, all items) prepared by the United States department of labor, bureau of labor statistics, for the twelve-month period ending on the preceding thirtieth day of September, and adjust the credit amount by multiplying the credit amount for the current year by the percentage increase in the consumer price index for that period, adding the resulting product to the credit amount for the current year, and rounding upward to the nearest multiple of five dollars. The resulting amount is the credit amount for the estates of decedents dying in the ensuing calendar year.
(C) If a resolution or ordinance adopted under section 5731.55 of the Revised Code is in effect on the date of the decedent's death, the tax levied under this section on the transfer of the decedent's estate shall be reduced by an amount equal to the tax that originates in that township or municipal corporation.
Sec. 5731.21.  (A)(1)(a) Except as provided under division (A)(3) of this section, the executor or administrator, or, if no executor or administrator has been appointed, another person in possession of property the transfer of which is subject to estate taxes under section 5731.02 or division (A) of section 5731.19 of the Revised Code, shall file an estate tax return, within nine months of the date of the decedent's death, in the form prescribed by the tax commissioner, in duplicate, with the probate court of the county. The return shall include all property the transfer of which is subject to estate taxes, whether that property is transferred under the last will and testament of the decedent or otherwise. The time for filing the return may be extended by the tax commissioner.
(b) The estate tax return described in division (A)(1)(a) of this section shall be accompanied by a certificate, in the form prescribed by the tax commissioner, that is signed by the executor, administrator, or other person required to file the return, and that states includes all of the following:
(i) The fact A statement that the return was filed;
(ii) The date of the filing of the return;
(iii) The fact A statement that the estate taxes under section 5731.02 or division (A) of section 5731.19 of the Revised Code, that are shown to be due in the return, have been paid in full;
(iv) If applicable, the fact a statement that real property listed in the inventory for the decedent's estate is included in the return;
(v) If applicable, the fact a statement that real property not listed in the inventory for the decedent's estate, including, but not limited to, survivorship tenancy property as described in section 5302.17 of the Revised Code or transfer on death property as described in sections 5302.22 and 5302.23 of the Revised Code, also is included in the return. In this regard, the certificate additionally shall describe that real property by the same description used in the return;
(vi) If applicable, a list of all property in the inventory exempted from estate tax under a resolution or ordinance adopted pursuant to section 5731.55 of the Revised Code, and for each item of property, the municipal corporation or township in which the tax on the property would have originated if the property had not been exempted.
(2) The probate court shall forward one copy of the estate tax return described in division (A)(1)(a) of this section to the tax commissioner.
(3) A person shall not be required to file a return under division (A) of this section if the decedent was a resident of this state and the value of the decedent's gross estate is twenty-five thousand dollars or less in the case of a decedent dying on or after July 1, 1968, but before January 1, 2001; two hundred thousand dollars or less in the case of a decedent dying on or after January 1, 2001, but before January 1, 2002; or three hundred thirty-eight thousand three hundred thirty-three three hundred sixty-six thousand two hundred fifty dollars or less in the case of a decedent dying on or after January 1, 2002 January 1, 2010. In December of each year, beginning in 2011, after the tax commissioner has adjusted the credit amount under division (B) of section 5731.02 of the Revised Code, the commissioner shall compute the taxable estate value upon which the tax imposed by division (A) of that section, before applying the credit, equals the credit amount computed under division (B) of that section. A person is not required to file a return under division (A) of this section if the decedent is a resident of this state, the decedent dies in the following calendar year, and the value of the decedent's gross estate is less than the value computed by the commissioner.
(4)(a) Upon receipt of the estate tax return described in division (A)(1)(a) of this section and the accompanying certificate described in division (A)(1)(b) of this section, the probate court promptly shall give notice of the return, by a form prescribed by the tax commissioner, to the county auditor. The auditor then shall make a charge based upon the notice and shall certify a duplicate of the charge to the county treasurer. The treasurer then shall collect, subject to division (A) of section 5731.25 of the Revised Code or any other statute extending the time for payment of an estate tax, the tax so charged.
(b) Upon receipt of the return and the accompanying certificate, the probate court also shall forward the certificate to the auditor. When satisfied that the estate taxes under section 5731.02 or division (A) of section 5731.19 of the Revised Code, that are shown to be due in the return, have been paid in full, the auditor shall stamp the certificate so forwarded to verify that payment. The auditor then shall return the stamped certificate to the probate court.
(5)(a) The certificate described in division (A)(1)(b) of this section is a public record subject to inspection and copying in accordance with section 149.43 of the Revised Code. It shall be kept in the records of the probate court pertaining to the decedent's estate and is not subject to the confidentiality provisions of section 5731.90 of the Revised Code.
(b) All persons are entitled to rely on the statements contained in a certificate as described in division (A)(1)(b) of this section if it has been filed in accordance with that division, forwarded to a county auditor and stamped in accordance with division (A)(4) of this section, and placed in the records of the probate court pertaining to the decedent's estate in accordance with division (A)(5)(a) of this section. The real property referred to in the certificate shall be free of, and may be regarded by all persons as being free of, any lien for estate taxes under section 5731.02 and division (A) of section 5731.19 of the Revised Code.
(B) An estate tax return filed under this section, in the form prescribed by the tax commissioner, and showing that no estate tax is due shall result in a determination that no estate tax is due, if the tax commissioner within three months after the receipt of the return by the department of taxation, fails to file exceptions to the return in the probate court of the county in which the return was filed. A copy of exceptions to a return of that nature, when the tax commissioner files them within that period, shall be sent by ordinary mail to the person who filed the return. The tax commissioner is not bound under this division by a determination that no estate tax is due, with respect to property not disclosed in the return.
(C) If the executor, administrator, or other person required to file an estate tax return fails to file it within nine months of the date of the decedent's death, the tax commissioner may determine the estate tax in that estate and issue a certificate of determination in the same manner as is provided in division (B) of section 5731.27 of the Revised Code. A certificate of determination of that nature has the same force and effect as though a return had been filed and a certificate of determination issued with respect to the return.
Sec. 5731.48.  (A) If a decedent dies on or after July 1, 1989, and before January 1, 2001, sixty-four per cent of the gross amount of taxes levied and paid under this chapter shall be for the use of the municipal corporation or township in which the tax originates, and shall be credited as provided in division (A)(1), (2), or (3) of this section:
(1) To the general revenue fund in the case of a city;
(2) To the general revenue fund of a village or to the board of education of a village, for school purposes, as the village council by resolution may approve;
(3) To the general revenue fund or to the board of education of the school district of which the township is a part, for school purposes, as the board of township trustees by resolution may approve, in the case of a township.
The remainder of the taxes levied and paid shall be for the use of the state and shall be credited to the general revenue fund.
(B) If a decedent dies on or after January 1, 2001, and before January 1, 2002, seventy and before January 1, 2010, eighty per cent of the gross amount of taxes levied and paid under this chapter shall be for the use of the municipal corporation or township in which the tax originates and credited as provided in division (A)(1), (2), or (3) of this section, and the remainder shall be for the use of the state and credited to the general revenue fund.
(C) If a decedent dies on or after January 1, 2002, eighty January 1, 2010, one hundred per cent of the gross amount of taxes levied and paid under this chapter, less any deduction from the municipal corporation's or township's share of those taxes for fees or expenses charged under section 5731.47 of the Revised Code, shall be for the use of the municipal corporation or township in which the tax originates and credited as provided in division (A)(1), (2), or (3) of this section, and the remainder, less any deduction from the state's share of those taxes for fees or expenses charged under section 5731.47 of the Revised Code, shall be for the use of the state and shall be credited to the general revenue fund.
If a resolution or ordinance adopted under section 5731.55 of the Revised Code is in effect on the date of the decedent's death, no taxes shall be considered to have originated in that township or municipal corporation for the purposes of this section.
(D) If a municipal corporation is in default with respect to the principal or interest of any outstanding notes or bonds, one half of the taxes distributed under this section shall be credited to the sinking or bond retirement fund of the municipal corporation, and the residue shall be credited to the general revenue fund.
(E) The council, board of trustees, or other legislative authority of a village or township may, by ordinance in the case of a village, or by resolution in the case of a township, provide that whenever there is money in the treasury of the village or township from taxes levied under this chapter, not required for immediate use, that money may be invested in federal, state, county, or municipal bonds, upon which there has been no default of the principal during the preceding five years.
Sec. 5731.55. (A) Unless an ordinance or resolution previously adopted under this section has been repealed by initiative petition under section 5731.56 of the Revised Code, the legislative authority of a municipal corporation may adopt an ordinance or resolution, or the board of township trustees of a township may adopt a resolution, exempting estate property in the municipal corporation or township from the taxes levied under this chapter. If the ordinance or resolution is adopted, the exemption shall take effect as provided in the ordinance or resolution but not before the first day of the first month that begins after the ordinance or resolution is adopted.
(B)(1) An ordinance or resolution exempting estate property in a municipal corporation from the taxes levied under this chapter may be proposed by an initiative petition in accordance with sections 731.28 and 731.31 to 731.40 of the Revised Code except that, if the ordinance or resolution is adopted, the exemption shall take effect as provided in the ordinance or resolution but not before the first day of the first month that begins after the ordinance or resolution is adopted.
(2) A resolution exempting estate property in a township from the taxes levied under this chapter may be proposed by an initiative petition under the same circumstances and in the same manner as provided by sections 731.28 and 731.31 to 731.40 of the Revised Code for municipal corporations, except that each of the following applies:
(a) The term "township" shall be substituted for the terms "municipal corporation" and "city or village," the term "board of township trustees" shall be substituted for "legislative authority of the municipal corporation," the term "township fiscal officer" shall be substituted for "city auditor" or "village clerk," and the term "resolution" shall be substituted for "ordinance."
(b) The petition shall contain the signatures of not less than ten per cent of the total number of electors in the township who voted for the office of governor at the most recent general election for that office in the township.
If the resolution is adopted, the exemption shall take effect as provided in the resolution but not before the first day of the first month that begins after the resolution is adopted.
(C) The form of the ballot in an election held pursuant to division (B)(1) or (2) of this section shall be as follows, or in any other form acceptable to the secretary of state:
"Shall the .......... (name of township or municipal corporation) exempt estate property located in .......... (the township or municipal corporation) from the Ohio estate tax?"
(D) If a resolution or ordinance is adopted under this section, the legislative authority or board of township trustees shall provide written notice of the adoption of the resolution or ordinance to the tax commissioner within ten days after the date of the adoption. The tax commissioner shall keep a record of all municipal corporations and townships that have provided such a notice, shall make the record available for public inspection, and shall publish it in a manner convenient to the tax commissioner.
Sec. 5731.56. (A) If the legislative authority of a municipal corporation or the board of township trustees of a township have adopted a resolution or ordinance under division (A) of section 5731.55 of the Revised Code exempting estate property in the municipal corporation or township from the taxes levied under this chapter, the legislative authority or board of township trustees may adopt a resolution or ordinance repealing the exemption. If such a resolution or ordinance is adopted, the transfer of estate property in the municipal corporation or township shall not be exempted from the taxes levied under this chapter effective on the date specified in the resolution or ordinance, but that date shall not be earlier than the first day of the first month that begins after the resolution or ordinance is adopted.
(B)(1) A resolution or ordinance repealing the exemption of estate property from taxation enacted for a municipal corporation under section 5731.55 of the Revised Code may be proposed by initiative petition. The initiative petition shall be proposed in accordance with sections 731.28 and 731.31 to 731.40 of the Revised Code except that, if the resolution or ordinance is adopted, the repeal of the exemption shall take effect as provided in the resolution or ordinance, but not before the first day of the first month that begins after the resolution or ordinance is adopted.
(2) A resolution repealing the exemption of estate property from taxation enacted for a township under section 5731.55 of the Revised Code may be proposed by initiative petition. The initiative petition shall be proposed under the same circumstances and in the same manner as provided by sections 731.28 and 731.31 to 731.40 of the Revised Code for municipal corporations, except as provided in division (B)(2)(a) and (b) of section 5731.55 of the Revised Code. If the resolution is adopted, the repeal of the exemption shall take effect as provided in the resolution, but not before the first day of the first month that begins after the resolution is adopted.
(C) The form of the ballot in an election held pursuant to division (B)(1) or (2) of this section shall be as follows, or in any other form acceptable to the secretary of state:
"Shall the exemption from the Ohio estate tax of estate property in ........... (name of township or municipal corporation) be repealed?"
(D) If a resolution or ordinance is adopted under this section, the legislative authority or board of township trustees shall provide written notice of the adoption of the resolution or ordinance to the tax commissioner within ten days after the date of the adoption. The tax commissioner shall remove the municipal corporation or township from the record of municipal corporations and townships that have adopted resolutions or ordinances under section 5731.55 of the Revised Code.
Section 2. That existing sections 5731.02, 5731.21, and 5731.48 of the Revised Code are hereby repealed.
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