Ohio’s biennial budget, containing numerous changes that will affect every taxpayer in Ohio, was recently approved and signed by Governor Kasich.
Some of the more significant changes that have been implemented are as follows:
- Personal income tax rates will be cut by 10% over 3 years starting in 2013.
- Inflation indexing of income tax brackets and personal exemptions will be suspended for 3 years beginning in 2013.
- The $20 personal exemption credit will only be available to households with Ohio taxable income under $30k.
- Ohio small businesses will receive a 50% tax deduction on their first $250,000 of business income. This also applies to owners of passthrough entities.
- The Ohio sales tax rate will increase from 5.5% to 5.75% on September 1, 2013.
- Digital Products will be subject to sales tax.
- The minimum CAT tax of $150 will change to a variable tax dependent on the level of gross receipts.
- The 10% and 2.5% rollbacks on real property taxes for new and replacement levies will be eliminated.
Taxpayers should be aware of all the state tax changes as they will impact everyone differently based on their financial situation.
