Apportionment of Tax
Employers located outside of the Wilsonville transit district are subject to payroll and self-employment taxes if any employee, commission merchant, or commission employee does business in the Wilsonville transit district. Taxpayers do not pay both Wilsonville Transit Tax and TriMet Tax on the same taxable wages. If work is done in both districts then the taxable wages should be prorated and the applicable amounts paid to each district.
Are 401k plans included in the Wilsonville transit district payroll?
Yes, contributions to deferred compensation plans are subject including contributions to 401k retirement plans made at the election of the employee and matched by the employer
Are insurance agents exempt from Wilsonville transit tax?
Only insurance-related income is exempt. Noninsurance-related self-employment activities are subject to this tax (ORS 731.840).
Are nonprofit organizations subject to transit taxes?
Not all nonprofit organizations are exempt from the Wilsonville transit tax. Only the organizations with 501(C)3 status are exempt. Nonprofit organizations will need to send in a copy of the IRS determination.
Are real estate salespeople subject to Wilsonville transit tax?
Yes, they are treated as self-employed; therefore, commissions on sales within the Wilsonville transit district boundaries are subject to the transit tax through the individual’s net earnings from self-employment.
Are Section 125 cafeteria plans subject to the Wilsonville transit tax?
No, Section 125 cafeteria plans are exempt from the Wilsonville transit tax.
Are wages paid to church employees subject to Wilsonville transit tax?
No, churches are exempt from paying Wilsonville transit taxes.
How are the transit taxes determined on truck drivers, salespeople, and construction?
Employees who are subject to withholding tax, are subject to Wilsonville transit tax. If an employee only works a portion of the time in the Wilsonville transit district, then only that portion is subject to the tax. Wilsonville transit taxes are determined by where the work is physically performed including job sites and home locations.
How do we determine self-employment income?
Self-employment earnings are those reported on your individual federal Schedule SE, line three, as defined in IRC € 1402. If a taxpayer has more than one business included on federal Schedule SE, only include those businesses from line three of your federal Schedule SE that have net earnings. Do not use a business with a net loss to offset a business with net earnings.
Is there a minimum payment?
If the tax due for a quarter is less than $20 payment can be deferred until the end of the year; however, the quarterly transit tax return needs to be submitted showing the amount due with no payment; otherwise, the account will be considered delinquent and subject to penalties and/or interest. Sole proprietors can pay at year-end or make estimated quarterly tax payments.
What are the penalties and interest?
Late payment or non-payment will result in a penalty of 10% of the tax due for accounts up to 30 days past due. An additional penalty of 15% will be assessed on accounts over 30 days past due. Fraudulent tax returns or intent to evade will result in an additional 25% penalty. Interest shall be assessed at the rate of 1.5% per month. Legal fees and costs associated with the collection of tax will be the liability of the taxpayer.
What is the City of Wilsonville transit system tax boundary?
The Wilsonville Transit District boundary is the city limits of Wilsonville (including the Charbonneau District).
What is the difference between Wilsonville Transit District Payroll Excise Tax and Wilsonville Transit District Self-Employment Tax?
The excise tax is paid by the employer. The self-employment tax is paid by the self-employed person.
What is the Transit Tax rate?
The SMART tax rate is 0.005 effective October 1, 2008.
What is the Wilsonville Transit District Tax?
The transit tax was established to finance the operating and administrative costs of the SMART (South Metro Area Regional Transit) by City Code 7.400. Service includes bus connections to Portland, Salem, Canby, and bus services throughout Wilsonville.
Who do I call for questions?
For more information, please contact 503-570-1518.
Who must file and pay transit tax?
All employers, including nonresident employers, who are paying wages earned in the City of Wilsonville, must register and file with the City of Wilsonville Tax Department. Wages include all salaries, commissions, bonuses, fees, payment to a deferred compensation plan, or other items of value.
