What income should an Unincorporated (sole proprietor) business report?
The income that should be reported depends on whether both the owner and the business are resident or non-resident. An owner is a resident when his or her primary residence is within the city limits. A resident business is a business entity having an office, operation, or business site within the City. • If the owner is a resident and the business is a resident then all income is subject to tax, regardless of where the work was performed. • If the owner is a resident and the business is a non-resident, all income is subject to tax, regardless of where the work was performed. However, if taxes are paid to a city (other than Middletown) in which the business resides, then Middletown will grant the business a credit up to the amount paid to the other municipality (but not in excess of the 1.75% Middletown tax). • If the owner is a non-resident and the business is a resident, then only income earned for work performed in the City is taxable. • If the owner and the business are both non-res
