FAQs - Commercial Activity Tax (CAT)

What out-of-state persons are required to register and remit this tax?

An out-of-state person is only required to register and pay the CAT if that person has bright-line presence in Ohio. A person has bright-line presence if any one (1) of the following applies at any time during the calendar year:

i.   Property in this state is at least $50,000; or
ii.  Payroll in this state is at least $50,000; or
iii. Taxable gross receipts sitused to Ohio are at least $500,000; or
iv.  25% of total property or total payroll or total gross receipts is within this state; or
v.   The person is domiciled in this state.

Note:   An out-of-state person meeting one of the above criteria must also have at least $150,000 in taxable gross receipts sitused to Ohio during the calendar year to be subject to the CAT.

Examples:

  • If a person has at least $500,000 in taxable gross receipts sitused to Ohio and no property or payroll in this state, that person is subject to the CAT;
  • If a person has $1 million in total gross receipts, of which only $200,000 (20%) are taxable gross receipts sitused to Ohio, and such person has no property or payroll in this state, that person is not required to register and remit the CAT;
  • If a person has only $500,000 in gross receipts of which $250,000 (50%) are taxable gross receipts sitused to Ohio, then that person is required to register and pay the CAT;
  • If a person has $1 million in gross receipts, of which only $200,000 (20%) are taxable gross receipts sitused to Ohio, but has no property or payroll in this state, the person is not required to register and pay the CAT. However, if that person is domiciled in Ohio, then the person is required to register and remit the CAT. Please contact the CAT Division if you have any questions or refer to Information Release CAT 2005-02- Commercial Activity Tax: Nexus Standards for more details.