Village of Greenwich, Taxation Department
Income Tax Penalty and Interest
As required by Ohio Revised Code effective 1/1/2016 for tax years 2016 and greater, the Village of Greenwich is releasing the mandated interest and penalty charges.
Per the Ohio Revised Code, 718.27 operative 1/1/2016:
“Federal short-term rate” means the rate of the average market yield on outstanding marketable obligations to the United States with remaining periods of maturity of three years or less, as determined under section 1274 of the Internal Revenue Code for July of the current year.
“Interest rate as described in division (A) of this section” means the federal short-term rate, rounded to the nearest whole number per cent, plus five per cent. The rate shall apply for the calendar year next following July of the year in which the federal short-term rate is determined in accordance with division (A)(4) of this section.
With respect to unpaid income tax and unpaid estimated income tax, a penalty equal to fifteen percent of the amount not timely paid shall be imposed.
With respect to any unpaid withholding tax, a penalty equal to fifty percent of the amount not timely paid shall be imposed.
The Federal Short Term Rate is available on the following webpage:
For July 2015, the Annual Short-term AFR is 0.48% so the annual interest rate for tax year 2016 tax obligations will be 5% annually or 0.417% per month (or part thereof) of the tax not paid by the due date.
This interest rate of 0.417% per month (or part thereof) will be in effect for withholding tax for tax year 2016 not paid by the due date.