Each year about this time, the City of Hilliard’s Finance Department begins to get a lot of questions about income taxes and property taxes and how those funds are invested back into the community.
These are great questions.
First, remember that municipal governments and school districts are separate governmental agencies with different governing bodies of elected officials. Cities are primarily funded by income taxes and Ohio school districts by property taxes. This is important when talking about the investment of local tax revenues back into our community.
Income taxes
First, it’s important to note that all adults ages 18 and older living in the City of Hilliard must file local income taxes through the Regional Income Tax Agency (RITA), regardless of whether they actually work in the City or earn income. The exception is for retirees, who are not required to file if they are not earning an income.
The filing deadline is April 15 (or by the following Monday if April 15 is a weekend day).
The City of Hilliard’s primary funding source is a 2.5% income tax, accounting for nearly 70% of the its general-fund revenue. Of those taxes, 0.5% is earmarked for recreation and parks.
Hilliard residents pay this 2.5% municipal income tax unless they are taxed by another community where they work. Residents get credit up to 2.5% for taxes they pay in other communities where they work.
So, a Hilliard resident who works in Columbus – where there is a 2.5% income tax – still must file Hilliard income taxes through RITA, but will get credit for the Columbus tax so will not pay Hilliard taxes. A Hilliard resident who works in a community that collects only 2.0% will pay Hilliard the additional 0.5%.
Most of Hilliard’s local income taxes are paid by people who work within the City’s corporate boundaries but do not live here. That means our community enjoys great services and quality-of-life amenities – such as snow removal, swimming pools, police, parks, bike trails and the community center – that largely are paid for by people who are not residents.
While income taxes are the City’s main source of revenue, there are additional funding sources for the City’s general fund, including fees for rendered services, fines, permits, grants and earnings on investment. Very little of our funding comes from property taxes.
Property taxes
The primary source of revenue for most Ohio public school districts is property taxes. Few school districts receive significant funds from local income taxes.
So, in short, income taxes pay for great city services and amenities, and if you don’t work in Hilliard you probably don’t pay Hilliard income taxes.
Meanwhile, property taxes and state and federal funds pay for most of the great education local students receive from Hilliard City Schools.
Filing your taxes
Remember, even if you don’t work and make no income, you still must file the forms.
Filling out your taxes can be complex. As you complete your RITA forms, know that the Hilliard Finance Department is available from 8 a.m. to 4 p.m. weekdays to help answer questions. You may contact us at (614) 876-7361, extension 778.
