The Buckeye Institute has filed an appeal in the case of Kresevic v. Kimmel with Ohio’s Ninth District Court of Appeals, representing Karen Kresevic from Chagrin Falls. The organization argues that the city of Akron improperly taxed a settlement payment received by Kresevic, claiming the payment did not constitute wages or compensation for work performed.
Jay R. Carson, senior litigator at The Buckeye Institute and attorney for Kresevic, stated, “The city of Akron stretched the law to take a cut of Ms. Kresevic’s settlement in breach of its own tax ordinances and forms. This case allows the court of appeals to correct the trial court’s errors and rein in local governments’ illegal taxation.”
According to The Buckeye Institute’s appeal brief, the trial court incorrectly ruled that Kresevic filed her claim after the one-year statute of limitations had expired. While Akron asserts that this period began on June 14, 2022—the date Kresevic received her settlement—the Institute contends that under Akron’s tax ordinances and forms, it should have started when she filed her return.
The appeal also disputes the trial court’s conclusion that Kresevic voluntarily paid the tax because she requested a refund on Tax Day 2022 instead of when her employer withheld taxes from her settlement payment. For administrative reasons, Kresevic agreed to have her employer classify these payments as W2 “wages,” but maintains they were not earned through work performed within Akron as defined by municipal code.
Kresevic was employed as a physician assistant at Akron City Hospital during 2020 amid the pandemic. After pursuing a wrongful termination claim against her employer, she received a settlement which was subsequently taxed by Akron as income from work performed in the city. In April 2022, she sought a refund for municipal taxes withheld from this payment, arguing they were not wages nor earned within Akron city limits. On July 11, 2022, citing House Bill 197 passed by Ohio lawmakers, Akron denied her request and maintained that these payments constituted income for work done in Akron.
The initial lawsuit was filed in Summit County Court of Common Pleas. Further updates about this case are available at BuckeyeInstitute.org/KresevicvKimmel.
