Columbus, OH – On Thursday, The Buckeye Institute filed a lawsuit on behalf of Karen Kresevic, who had municipal income taxes taken from a settlement package by the city of Akron, even though the settlement package did not represent wages and was not for any work performed. Kresevic v. Chittok was filed in the Summit County Court of Common Pleas.

“Although courts have allowed cities to tax the income taxes of nonresidents, it was with the understanding that the work was performed within the city’s limits,” said Jay R. Carson, senior litigator at The Buckeye Institute and an attorney representing Ms. Kresevic. “In our client’s case, there was no work performed. Yet, the city of Akron has stretched the law to take a cut of Ms. Kresevic’s settlement. It is time for the court to put an end to this wage theft.”

Karen Kresevic, of Chagrin Fall, Ohio, was a physician assistant working at Akron City Hospital in 2020 during the pandemic. After filing a wrongful termination claim, she and her employer came to a settlement agreement, which the city of Akron taxed as if it were income and as if Ms. Kresevic were working in Akron. In April 2022, Ms. Kresevic requested a refund on the municipal taxes withheld from the settlement payment, explaining that those payments were not for wages—let alone wages earned for work performed within the city of Akron. On July 11, 2022, the city of Akron—citing the Ohio General Assembly’s enactment of House Bill 197—denied her request for a refund stating that Akron deemed that those payments were for work she performed within the city of Akron.

# # #