CORPORATE FRANCHISE TAX INFORMATION RELEASE – Questions
Regarding Ohio’s Manufacturing Machinery and Equipment Tax
Credit – R.C. 5733.33 & 5747.31 – Issued September, 2004;
Revised February, 2005
This information release addresses questions the Ohio
Department of Taxation (“ODT”) has received regarding Ohio’s
tax credit for purchases of new manufacturing machinery and
equipment for use in Ohio. At the present time, taxpayers may
continue to claim (i) the Ohio tax credit for such new
manufacturing machinery and equipment as provided by Ohio
Revised Code sections (“R.C.”) 5733.33 and 5747.31 and (ii)
all other tax credits that ODT directly or indirectly
Because the State of Ohio will soon be petitioning the U.S.
Supreme Court to review the U.S. Sixth Circuit Court of
Appeals’ decision in Cuno, the State of Ohio recently
petitioned the U.S. Sixth Circuit Court of Appeals to stay
the issuance of the mandate, that is, to postpone putting
into effect its earlier decision which enjoined enforcement
of the credit. On January 31, 2005 the U.S. Sixth Circuit
Court of Appeals did, in fact, agree to stay the issuance of
the mandate. Because the U.S. Sixth Circuit Court of Appeals
did stay the mandate2, ODT is not currently
enjoined from administering the tax credit. As such,
taxpayers may continue claiming the credit for purchases of
new manufacturing machinery and equipment qualifying for the
credit under Ohio law.
ODT will issue future notifications to taxpayers and
practitioners as the situation warrants. If you have
questions regarding the legal implications of continuing to
claim this tax credit or other tax credits, ODT urges you to
seek advice from tax counsel.
1If the U.S. Supreme Court issues to the U.S.
Sixth Circuit Court of Appeals a writ of certiorari, then the
U.S. Supreme Court will hear the State of Ohio’s appeal of
the U.S. Sixth Circuit Court of Appeals’ Cuno decision.
Federal law does not require that the U.S. Supreme Court
issue the writ of certiorari; issuing the writ is
discretionary. If the U.S. Supreme Court does not issue the
writ of certiorari, then there are no further appeals, and
the U.S. Sixth Circuit Court of Appeals’ Cuno decision (which
“enjoined enforcement of the credit”) becomes final.
2 The order in its entirety states as follow:
“Upon consideration of the appellees’ motion to stay mandate,
It is ORDERED that the mandate be stayed to allow time to
file a petition for a writ of certiorari, and thereafter
until the Supreme Court disposes of the case, but shall
promptly issue if the petition is not filed within ninety
days from the date of final judgment by this court.” United
States Court of Appeals for the Sixth Circuit, Case No.
01-3960, order filed January 31, 2005.