Effective: January 15, 1993
Latest Legislation: Senate Bill 358 - 119th General Assembly
If any corporation uses the rights and powers granted by its charter to prevent the assessment of the shares of its resident shareholders on the basis of income yield, as provided in sections 5711.01 to 5711.36 of the Revised Code, by permitting its gains and profits to accumulate instead of being distributed, or by paying exorbitant salaries to its officers and employees, the tax commissioner, upon finding such to be the fact, shall assess the amount representing the aggregate assessments of the shares of such resident shareholders in the names of such resident shareholders and certify such assessments, together with the penalty provided in such sections, to the proper county auditor who shall place the same on the classified tax list and duplicate in the names of such shareholders, as investments assessed on the basis of income yield for the year for which such assessments are made; and taxes shall be collected thereon the same as on other like assessments. The commissioner shall give notice of such assessment to the corporation by personal service or certified mail, and such assessment shall be subject to a petition for reassessment and an appeal as provided in sections 5711.31 and 5717.02 of the Revised Code.
If any such corporation is a holding or investment company, or if the gains or profits are permitted to accumulate beyond the reasonable needs of the business, such fact shall be prima-facie evidence of a purpose to prevent the assessment of the shares of its resident stockholders on such basis.
If any trust, under the terms of which the trustee is required or authorized to withhold and accumulate all or any part of the income, is created or used for the purpose of preventing the assessment of the equitable interests of the resident beneficiaries on the basis of income yield, as provided in sections 5711.01 to 5711.36 of the Revised Code, the commissioner, upon finding such to be the fact, shall assess the amount representing the aggregate assessment of such equitable shares in the manner provided in this section. If the creator of such trust reserved a power of revocation, or if the trustee has discretion to pay and distribute the income of the trust property to or for the benefit of such resident beneficiary, such fact shall be prima-facie evidence of a purpose to prevent the assessment of the equitable shares of the resident beneficiaries upon such basis.
The assessment imposed by this action shall not be made against any resident shareholder of such corporation or beneficiary of such trust who in filing his return lists as the income yield of his shares or beneficial interest the entire distributive share or beneficial interest, whether distributed or not, of the net income of such corporation or trust for such year, in which event any subsequent distribution made by such corporation or trust out of the earnings or profits of such year shall, if distributed to any shareholder or beneficiary who has so included in the income yield of his shares the distributive share thereof, be deducted from the income yield of such shares for the year in which the same is made.
Structure Ohio Revised Code
Chapter 5711 | Listing Personal Property
Section 5711.01 | Listing Personal Property Definitions.
Section 5711.02 | Annual Returns - Supplying of Blanks.
Section 5711.03 | Listing of Taxable Property.
Section 5711.04 | Time for Making Returns.
Section 5711.05 | Returns of Taxable Property - Fiduciary Returns.
Section 5711.06 | Listing of Transferred Investments.
Section 5711.07 | Proper Taxing District for Listing Property.
Section 5711.09 | Powers and Duties of Tax Commissioner - Contents of Return.
Section 5711.10 | Option to File Verified Federal Income Tax Return.
Section 5711.131 | County Supplemental Return.
Section 5711.14 | Consolidated Returns for Corporations - Joint Returns for Husband and Wife.
Section 5711.15 | Valuation of Merchandise Offered for Sale.
Section 5711.16 | Listing of Personal Property by Manufacturer - Average Value of Articles.
Section 5711.17 | Separate Listing of Property by Manufacturer.
Section 5711.18 | Valuation of Accounts and Personal Property - Procedure - Income Yield.
Section 5711.19 | Determination of Trust Income - Cash Distribution.
Section 5711.21 | Rules Governing Assessments.
Section 5711.22 | Listing and Rates of Personal Property Tax.
Section 5711.221 | Report of Investment Income.
Section 5711.23 | Reclassified Property Assessable.
Section 5711.24 | Power of Tax Commissioner to Assess Taxable Property - Assessment Certificate.
Section 5711.25 | Procedure in Dealing With Assessment Certificates - Final Certificates.
Section 5711.26 | Commissioner May Make Certain Final Assessments.
Section 5711.30 | Penalty Assessment for Declaring a Nominal Dividend or to Evade Taxes.
Section 5711.31 | Notice of Assessment - Petition for Reassessment - Final Determination.
Section 5711.32 | Correction of Records and Tax Lists.
Section 5711.33 | Tax Bills Issued for Deficiency Assessment.
Section 5711.34 | List of Investment Holders in Corporations to Be Filed With Tax Commissioner.
Section 5711.341 | List of Investors in Money Market Investment to Be Filed With Tax Commissioner.
Section 5711.35 | Resident Deputy County Treasurer.
Section 5711.36 | Filing and Preservation of Returns and Assessment Certificates.