FAQs - Employer Withholding

Our company conducts all of its business in a state that borders Ohio (e.g. Indiana, Kentucky, Michigan, Pennsylvania, or West Virginia). Several of our employees are Ohio residents that commute to that state each work day. Are we required to withhold Ohio income tax on those employees' compensation?

You are not required to withhold Ohio income tax from your Ohio resident employees’ wages since you do not maintain an office or transact business in the state of Ohio. However, for the Ohio resident employees’ benefit, you may withhold Ohio income tax since they will owe tax to Ohio on their compensation.