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 a "related member"? Can you provide an example?

A “related member” is any person directly or indirectly related to the taxpayer or qualifying entity by an ownership interest of at least 40%. See R.C. 5733.40(P) or I.R.C. 1563(e).

A “related member” is also a family member or their partnership, trust, estate, or S-Corp (a “related entity”) if the related entity owns directly,  indirectly, beneficially, or via attribution, at least 50% of the pass-through entity. See R.C. 5733.04(I)(12)(i) and I.R.C. 318. Expenses typically subject to add back includes management fees, rents, compensation to a family member, etc. See R.C. 5733.40(A)(3).