FAQs - Employer Withholding

We are contemplating the purchase of a business, or all of its assets or inventories. As a buyer, are we required to withhold part of the purchase price to cover the unpaid withholding tax liability of the seller?

Yes, Ohio Revised Code section 5747.07(H) requires that the employer’s successor withhold enough purchase money to cover the amount of the taxes, interest and penalties due and unpaid, until the former owner provides a receipt from the Tax Commissioner showing that the taxes, interest and penalties have been paid or a certificate that no such liability is due. If purchase money is not withheld, the buyer can be held personally liable for the Ohio withholding tax liabilities of the seller.