Big tax news out of Columbus on March 24th. Ohio Legislature approved a tax conformity bill and voted to move the tax deadline to May 17th. Both items await Governor DeWine’s signature.
Senate Bill 18 will conform Ohio’s tax laws to changes in federal tax laws. Highlights of the bill include:
- Incorporates into Ohio income tax law changes to federal tax law taking effect since March 27, 2020.
- Exempts “second draw” paycheck protection program (PPP) loan amounts forgiven under the Consolidated Appropriations Act, 2021 from the commercial activity tax (CAT).
- Exempts from the CAT Bureau of Workers’ Compensation (BWC) dividends paid to employers in 2020 and 2021.
- Authorizes the Tax Commissioner to temporarily abate any interest or penalties for the underpayment of state and school district income taxes due on unemployment benefits received in 2020.
- Allows individuals to elect to have state income tax withheld from their unemployment benefits.
- Sets the rate of a withholding tax paid by certain pass-through entities on a percentage of its nonresident investors’ distributive income equal to the income tax rate on taxable business income, effectively reducing those withholding rates.
- Declares an emergency
You can learn more from the Ohio Department of Taxation which posted a summary of the new tax conformity bill.
