faqs for individuals

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What is the individual income tax rate in Mason?
The tax rate is 1%. Residents employed in another city that had an earnings tax can take a maximum credit of up to 100% of the tax due on the portion of their earnings taxed by the city where employed. Even if no tax is due, you are still required to file a return.

Who must pay the individual income tax?
All residents of the City of Mason, regardless of age and income. Even if you are not required to file a federal tax return, you must file a Mason tax return.

Can my taxes be deducted from my paycheck?
Municipal income taxes deducted from your paycheck are paid to the municipality in which you work. If you work in Mason, your Mason income tax should be deducted from your paycheck by your employer and paid to the city for you. If your employer is not in Mason but is willing to withhold Mason taxes for you, your employer can easily set up a withholding tax account by completing the Business Income Tax Questionnaire (PDF) and mailing or faxing it to the Tax Office.

I don't work in Mason. Is my entire tax payment due in April?
Yes and No. All of your taxes must be paid by April 15th of the following year, but you must also file a declaration of estimated tax and make quarterly payments throughout the tax year. Penalties are incurred if 90% of your taxes are not paid by January 31st following the end of a tax year.

What is the due date for filing my return or quarterly payment?
All residents must file an annual tax return by April 15th of each year. Quarterly estimated payments are due on April 15th, July 31st, October 31st, and January 31st.

My employer collects income tax for Mason, but I have other income as well. Do I have to file quarterly estimated payments?
Yes, if the amount deducted by your Mason employer will not be at least 90% of the amount of taxes you owe for the year. Otherwise, you may be subject to penalties.

What types of income are taxable?

• Qualifying wages, commissions
• Vacation pay
• Tips, bonuses, gifts in lieu of pay, gratuities
• *Car allowance, personal use of employer-provided vehicle
• Wage continuation plans
• Supplemental unemployment pay, severance pay
• *Employer paid group term life insurance premiums
• *Incentive payments
• *Sick and disability pay
• *401K plans and the like
• *Deferred compensation
• *Fees
• *Employer-provided property, board, lodging and similar items
• Prizes, including trips, connected with employment
• *Stock option from employee stock purchase plan
• *Moving expense reimbursement
• *Stipends
• *Profit sharing
• Jury duty pay
• Income from a guaranteed annual wage contract

*For additional information, please see the Mason Tax Ordinance

What types of income are NOT taxable?

• Military pay or allowances paid to members of the Armed Forces, Reserves, National Guard, or Peace Corps
• Pensions and distributions paid as a result of retirement
• Cafeteria plans and the like
• Social Security benefits
• Unemployment compensation paid by the state or federal government
• Disability benefits (does not include sick pay or short-term disabilities)
• Interest, dividends, capital gains or other income from intangibles
• Parsonage housing allowance of ordained ministers
• Gain from the conversion or cancellation of indebtedness
• Income used for unreimbursed business expenses reported on a federal form 2106
• Compensation of a precinct election official
• Lottery or gambling winnings

How do I know if my employer is withholding Mason taxes for me?
Look at box 20 on your W-2. It should show the name of the municipality for which taxes are withheld. This information may also be on your paycheck stub.

When I fill out my Mason tax form, which boxes on my W-2 do I use?
Typically, the qualifying wages found in box 5 are subject to tax. For exceptions, see the General Information Sheet. Box 19 shows the amount of taxes withheld. Box 20 names the municipality for which the taxes were withheld.

Why is my "Medicare" amount (Box 5) higher than the "Wages, tips, other compensation" (Box 1) that I use on my federal tax return?
Many people find that their qualifying wages are higher because they include all types of earnings, some of which may be deferred for federal income tax purposes. These amounts are taxed for municipal purposes because they are excluded from municipal taxes upon retirement.

I pay local taxes to the city where I work. Can I get a credit on my Mason taxes?
Yes. If you are employed in another city that had an earnings tax, you may take a maximum credit of 100% of the Mason tax due on the portion of your earnings taxed by the city where you are employed. Please remember that even if no tax is due, you will still be required to file a return.

Example: The W-2 shows withholding for another city and Box 18 of your W-2 is $36,000:

If I overpay my taxes, can I get a refund?
Yes. The refund amount will be figured on your Mason tax return. You may have the amount credited to your next year's estimate or, if the amount is over $1.00, you may request a refund check. A 1099-G form will be filed with the IRS for all refunds credited or issued and the amount will also be reported to the city where you reside (if not Mason).

Can I get an extension of the filing deadline?
Yes, if a written request is submitted on or before the due date for filing the return. Extensions may not exceed six months or one month beyond any extension requested of or granted by the Internal Revenue Service. Use the Mason Extension Request (PDF) Form ER to submit your request.

Can a return be amended after it is filed?
Yes. An amended return must be filed to report additional income and to pay any additional tax due, or to claim a refund of overpaid taxes.

How are payments applied to my account?
All payments are first applied to interest charges, then penalties, then against past due taxes in the order in which they became due, and then against all current taxes due. For example, if you owe a balance for 2010, plus penalty and interest, your 2011 payments will apply to the interest and penalties for 2010, then the balance due for 2010, and finally, the amount due for 2011.

I lived in Mason for only part of the year. Do I have to use a special form?
No. Instructions for partial year residents are included with the tax form.

How do I obtain a Mason tax form?
Forms may be obtained here or picked up at the following locations: 

• Customer service Center at Mason Municipal Center, 6000 Mason-Montgomery Road
• Mason Community Center, 6050 Mason-Montgomery Road
• Mason Public Library, 200 Reading Road

Residents may also use the Online Tax Tool to file their forms.