2000-04 - Rounding - September 29, 2000
The purpose of this informational release is to explain the
changes made under the Taxpayer Services Bill, H.B. 612
(effective 9/29/2000), that allows for amounts entered on
most documents filed with the Tax Commissioner to be rounded.
Newly enacted R.C. 5703.055 allows taxpayers to elect to
permissively round and authorizes the Tax Commissioner to
require rounding. The procedures for rounding are discussed
below.
Permissive
Rounding
As stated above, R.C. 5703.055 explicitly permits taxpayers
to round all amounts entered on any return, report, voucher
or any other document filed with the Department. Please note,
if the taxpayer elects to round, the taxpayer cannot
selectively round some figures and not others within the same
return or report.
Mandatory
Rounding
R.C. 5703.055 also gives the Tax Commissioner the authority
to require rounding. When rounding is required, taxpayers
will be notified. Due to changes that need to be made with
the tax forms and processing procedures, the implementation
of mandatory rounding may take some time.
Rules for
Rounding
The same rules apply for both permissive and mandatory
rounding.
- For amounts ending in $.49 or less—round down and drop
the cents.
- For amounts ending in $.50 or more—round up to the next
whole dollar.
Examples:
- If the amount is $100.16, round to $100.00If the amount
is $100.49, round to $100.00If the amount is $100.50, round
to $101.00
- If the amount is $100.78, round to $101.00
Sales
Tax
It is important to point out that rounding impacts only the
final reporting and remitting of sales and use tax. Vendors
and out-of-state sellers are still required to collect the
exact amount of the tax--down to the penny--pursuant
to the bracketed tax structure under R.C. 5739.025. If a
vendor or out-of-state seller elects to round, they must
still calculate their original gross sales, exempt sales, and
taxable sales using the same exacting methodology as always;
only the final figures reported on the returns filed with the
Tax Commissioner are subject to rounding.