Information Release

SEV 2017-01 – Excise & Energy Tax Division Information Release – Severance Tax Changes for Homestead Use of Natural Resources - Issued August, 2017

The 132nd Ohio General Assembly enacted Amended Substitute House Bill 49 which provides for changes in the Ohio severance tax.   

Effective beginning October 1, 2017, the severance tax exemption in R.C. 5749.03 will change. R.C. 5749.03 has been amended to exempt from severance tax natural resources severed from an exempt domestic well. “Exempt domestic well” is defined in R.C. 5749.01(D) as having the same definition as in R.C. 1509.01. R.C. 1509.01(X) defines an exempt domestic well as follows:

“Exempt domestic well” means a well that meets all the following criteria:

  1. Is owned by the owner of the of the surface estate of the tract on which the well is located;
  2. Is used primarily to provide gas for the owner’s domestic use;
  3. Is located more than two hundred feet horizontal distance from any inhabited private dwelling house other than an inhabited private dwelling house located on the tract on which the well is located;
  4. Is located more than two hundred feet horizontal distance from any public building that may be used as a place of resort, assembly, education, entertainment, lodging, trade, manufacture, repair, storage, traffic, or occupancy by the public. 

  
Therefore, on or after October 1, 2017, no severance tax will be due for  natural resources severed from an exempt domestic well as defined above. 

If you have any questions about this release, please contact the Department at (855) 466-3921.

Ohio Department of Taxation
Excise & Energy Tax Division
P.O. Box 530
Columbus, Ohio 43216-0530
Telephone: (855) 466-3921
Fax: (206) 350-6722
Web site: tax.ohio.gov