County Bulletin
TO: ALL COUNTY AUDITORS - Bulletin No. 248
FROM: Edgar L. Lindley, Tax Commissioner
DATE: January 31, 1979
RE: Guidelines for Consolidated Personal Property Tax Returns
A parent corporation and its subsidiary corporations are
permitted, pursuant to Section 5711.14 of the Revised Code,
to file consolidated personal property tax returns, subject
to certain limitations. The sole advantage of consolidation
is the elimination of the intangible tax on inter-company
indebtedness. Values for tangible personal property are not
affected; each corporation remains a separate taxpayer.
The consolidated tax return must include the parent
corporation and, except as noted, every subsidiary
corporation in which the parent owns or controls at least 51%
of the outstanding common stock. Subsidiary corporations
cannot be included when for any particular year they
1) do not employ the same tax listing date as their parent
or are prohibited by Tax Commissioner Rule 5703-3-04 from
using the same tax listing date as their parent, or
2) are not authorized by the Tax Commissioner under Rule
5703-3-04 to employ the same tax listing date as their
parent, or
3) first engage in business in Ohio on or after January 1
of that year, or
4) are defined by law and required to file separately as a
financial institution, a dealer in intangibles or a public
utility, or
5) are defined by law as a domestic or foreign insurance
company.
If a subsidiary corporation is prohibited because of one or
more of the above reasons from being included in the
consolidation, it must file a separate tax return and balance
sheet and does not receive the benefit of any inter-company
eliminations.
In the year in which a consolidated return is first intended
to be filed, a written notice must be filed by the parent
corporation with the Tax Commissioner on or before the
due-date or extended due-date for filing the tax return. This
notice may be included with the consolidated return, if it is
timely filed. Consolidated returns must be filed each year
thereafter until notification to the contrary is given in
writing by the parent corporation to the Tax Commissioner on
or before April 20 of the year in which use of the
consolidated return is discontinued.
If all the Ohio taxable personal property of every
corporation included in the consolidation is located in a
single county, the consolidated filing must consist of the
following:
1) a separate tax return (Form 920) for the parent to list
the tangible personal property it owns and the net
intangible property of all the members in the
consolidation, together with a consolidating balance sheet.
2) a separate tax return (Form 920) for each subsidiary to
list the tangible personal property it owns.
On the parent’s tax return, its name must be followed by the
words "and Subsidiaries." On each subsidiary’s tax return,
the "consolidated" box must be checked and the name of the
parent corporation must be entered below. All tax returns and
the consolidating balance sheet shall be filed together with
the appropriate County Auditor.
If the combines taxable personal property of all corporations
included in the consolidation is located in more than one
Ohio county, the consolidated filing must be on an
inter-county tax return (Form 945). The parent’s name as it
appears on the tax return must be followed by the words "and
Subsidiaries." The "Taxpayer Identification for Consolidated
Returns" page must be completed, listing all subsidiaries
which hold an Ohio charter or license, or which have tangible
or intangible property with an Ohio situs. The personal
property owned by each corporation must be separately listed
and identified in both the schedules and recapitulation. The
group’s net intangible property is to be listed in the
appropriate schedules and will be taxes to the parent
corporation. A consolidating balance sheet must also be
included with the tax return.The consolidating balance sheet
referred to in both instances must reflect the same account
titles that are on prescribed Form 921 (Ohio Balance Sheet).
At least one column must be provided for the parent
corporation, for each subsidiary corporation included in the
consolidation for inert-company eliminations and for the
colsolidated totals of the entire group. To the extent any
one corporation has property situsable in and out of Ohio,
two columns must be provided for that corporation. If any
subsidiary is a foreign corporation not licensed to do
business in Ohio and has no property in Ohio, it is not
required to file a tax return but must be reflected on the
consolidating balance sheet.It should be noted that the only
intercompany eliminations recognized for personal property
tax purposes are those for intercompany advances and for
investments in the capital stock, bonds, or other
indebtedness of members of the group. Profits on intercompany
sales are not permitted to be eliminated, but elimination of
iner-division profits within a single corporation is
permitted.
This bulletin is written in conjunction with Section 5711.14
of the Revised Code and Rules 5703-3-04 and 6705-3-05 of the
Ohio Administrative Code. Nothing contained herein shall
apply to a taxpayer defined by law and required to file as a
financial institution, dealer in intangibles, public utility,
or domestic or foreign insurance company.