Overview of Municipal Taxes

Municipal taxes (also known as city or local taxes) are the primary source of revenue for city and village governments.  Registered voters (see County Boards of Elections to register) elect public officials whom establish the municipal tax rate of the municipality in which they reside.  The municipal tax revenues collected are utilized to fund essential municipal services (such as police and fire protection), infrastructure improvements (such as roads and parks), and to maintain and improve ongoing government operations.  Please note that a municipal tax is NOT a school district tax and school district tax should not be reported on a RITA return.   

The Regional Income Tax Agency (RITA) is a non-profit member agency that collects municipal taxes on behalf of its 135+ member municipalities and assists individuals in meeting their municipal tax filing obligations by providing responsive and courteous customer service delivery with cost-effective technology offerings, such as FREE electronic filing (E-File) and FREE electronic payment (E-Payments) processing.     

Within the State of Ohio, municipal tax is required to be withheld by employers to the cities of employment where the employees’ wages were physically earned. Additionally, in accordance with municipal income tax ordinances and RITA Rules & Regulations, individuals who reside in a RITA member municipality are required to file a return with RITA and pay any additional tax that might be due to their municipality of residence.

In most cases the additional tax due is the result of: 1) a difference in tax rates between the municipality where the employee works and the tax rate of the municipality where they live; 2) a reduced tax credit, which is the percentage of tax paid to another municipality (city) that the individual’s municipality of residence will recognize; or 3) non-wage income, such as self-employment income or rental property. 

Employees may ask their W-2 employer to withhold any additional tax due to their residence municipality on their W-2 wages as a courtesy.  If their employer chooses not to withhold the residence tax as a courtesy, the individual is required to make timely quarterly estimated payments to their municipality of residence.

Please note that mailing addresses are assigned by the United States Postal Service and do not always indicate the actual municipal (city) limits where an address is located for municipal tax purposes. Please perform an address validation to confirm the municipal limits of both your residence address and your employment address because you may be: 1) incorrectly filing a return with RITA; 2) incorrectly having municipal taxes withheld by your employer; or 3) incorrectly paying taxes directly to RITA.

Before you contact RITA, please review the expanded frequently asked questions (FAQ’s) on our website.  RITA is continually investing in the information and filing offerings on our website so that our member municipalities and the residents they serve benefit from the cost-effective servicing solutions that our technology provides.