Frequently Asked Questions

The Ohio Department of Taxation has compiled a list of frequently asked questions covering many different categories.

To view the questions, click on the "Select Category" bar and then click on the category you are interested in.  A list of questions will appear pertaining to that category. Then click on the question you are inquiring about and the answer will appear.

I'm retired from the Air Force and reside in Ohio. What tax obligations do I have for my military retirement pay, and if I die before my spouse dies, how does Ohio tax income from the military survivor benefit plan?

Law Change for Taxable Years 2008 and Forward: Effective for taxable years beginning after Dec. 31, 2007, military retirement pay of taxpayers who retired from the active or reserve components of the U.S. Army, Navy, Air Force, Marine Corps, Coast Guard, or from the National Guard, and Survivor Benefit Plan (SBP) benefit recipients, are exempt from Ohio income tax and from Ohio school district income tax. Eligible taxpayers can use Schedule A of Ohio income tax form IT 1040 to deduct such retirement pay included in federal adjusted gross income.

Eligible taxpayers can request that their Ohio withholding be adjusted by contacting the Defense Finance and Accounting Service at www.dfas.mil or (800) 321-1080.

This deduction also applies to such amounts received by the surviving spouse or the former spouse of each military retiree who is receiving payments under the Survivor Benefit Plan. Please note that child support receipts, regardless of the source, are not included in federal adjusted gross income; so these amounts are not deductible.

Federal civil service retirees who received federal service credit for military service are allowed to deduct only that portion of their pension attributable to military service. A formula for this deduction can be found in the Ohio income tax instructions under the Schedule A deductions. The formula is illustrated in the example below.

Example: The taxpayer has included in federal adjusted gross income (line 1 of the Ohio income tax return, form IT 1040) $60,000 which the taxpayer received as a federal civil service pension. The taxpayer has 15 years of military service and 45 years of combined military service and civilian employment with the U.S. government. The fraction is 15/45 = 1/3. The taxpayer can deduct $20,000 on Ohio Schedule A for Military Retirement Income: 1/3 X $60,000.

Note:  Because military retirement income is deducted from federal adjusted gross income and thus is not included in Ohio adjusted gross income for post-2007 years, military retirement income does not qualify for the Ohio retirement income credit.

For Taxable Year 2007 and Prior Years: Ohio residents must pay Ohio income tax on their military retirement income for taxable year 2007 and prior. However, these taxpayers are eligible for a retirement income credit of up to $200, based on the amount of retirement income received during the taxable year. This credit can be found in Schedule B of the Ohio income tax return. Income which a spouse receives from a military survivor benefit plan is also treated as retirement income and is also eligible for the credit of up to $200.

Beginning in taxable year 2013, taxpayers who receive retirement income related to uniformed service in the Commissioned Corps of the National Oceanic and Atmospheric Administration (NOAA) and the Commissioned Corps of the Public Health Service (PHS) are allowed a deduction for the entire amount of such pay to the extent it is included in federal adjusted gross income. This deduction can be taken on Schedule A, line 39b of the Ohio IT 1040. Prior to this change, the deduction was only available to former service members of the United States Army, Navy, Air Force, Coast Guard, or Marine Corps receiving military retirement pay. See ORC 5747.01(A)(26).

For more information:​​

You can reach us by e-mail at Military-Info@tax.state.oh.us. Our toll-free number for individual taxpayer inquiries is (800) 282-1780, and the toll-free number for forms is (800) 282-1782.

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