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.

What is changing?

  • For taxable years 2013 and forward, individual taxpayers owning businesses organized as sole proprietorships or pass-through entities (PTEs) can take advantage of the new “50% small business investor income deduction.”  These entities could include partnerships, subchapter S corporations, and limited liability companies (LLCs).  The deduction amounts to 50% of up to $250,000 of the taxpayer’s Ohio-sourced business income. For individuals with a filing status of married filing joint or single, $250,000 is the maximum income subject to the deduction. For individuals with a filing status of married filing separately, $125,000 is the maximum income subject to deduction.  In either case, the maximum income subject to deduction cannot exceed the taxpayer’s OAGI as if calculated prior to taking the deduction.  The deduction is only available to individuals on the OH form IT1040.
  • For taxable year 2014 only, the Small Business Investor Income deduction will increase to 75% of a taxpayer's small business income of up to $250,000. The deduction will be limited to $187,500 for individuals with a filing status of married filing jointly or single. For individuals with a filing status of married filing separately, $125,000 is the maximum income subject to deduction which allows for a deduction of up to $93,750. At this time, Ohio House Bill 483 authorizes the temporary increase in this income tax deduction for tax year 2014 only.