Jefferson County Occupational Tax Refund Settlement Guidelines

Last week, our business clients located in Jefferson County began receiving correspondence from the Refund and Settlement Administrator presiding over the escrowed occupational and business license tax covering the period January 12, 2009 through August 13, 2009. These taxes will soon be available for refund to affected employees and businesses, but only if certain administrative requirements and deadlines are met.

First, affected employees must be notified of the proposed settlement. Businesses must meet this notification requirement by (1) mailing or emailing the Short Form Class Notice to affected employees (including former employees that were employed by the business during the refund period) and (2) posting the Short Form Class Notice and Long Form Class Notice in a central location of the business (such as a break room) where employees are most likely to see the notices. This notice should take place no later than Friday, June 24, 2011.

Second, employers must complete and submit to the Administrator an Employee Refund Data Form by Wednesday, July 13, 2011. The employee data required by this form is as follows:

  1. Name
  2. Address
  3. Social Security Number
  4. Total 2009 Compensation
  5. Days Employed by Employer during Refund Period
  6. Days Employed by Employer in 2009

The notice of proposed settlement offers three options to businesses and employees that paid occupational, license, or privilege taxes during the covered period:

  1. Accept the settlement. No action is required, and the claimant will receive 83% of the taxes/licenses paid during the covered period. In exchange for the foregone 17%, the claimant will be exempt from any retroactive replacement tax/license levied by Jefferson County.
  2. Object to the settlement. If the settlement is approved above claimant objections, then the claimant will receive the 83% of taxes/licenses paid during the covered period. If the settlement is rejected, then the claimant will receive 100% of taxes/licenses paid during the covered period with no retroactive replacement tax/license exemption.
  3. Opt out of the settlement. The claimant will receive 100% of taxes/licenses paid during the covered period and no exemption for any retroactive replacement tax levy. The Opt Out Form must be received by the Special Master by Monday, July 25, 2011.

Because the settlement opt out is made at an employee level, the Opt Out Form should, for administrative convenience, be included with the Short Form Class Notice mailed to each employee. Employees should be encouraged to contact the Administrator directly with questions regarding the proposed settlement and refund claim procedure.

To reference the contents of the Claim Form Package and for additional background information, please visit Refund and Settlement Administrator website.