Federal tax rates apply to every taxpayer whereas, state taxes differ depending on the state. State income tax in Ohio is levied on your earnings every year and it is a percentage of your earned or unearned income that you pay to the state government.
There is a progressive individual income tax rate in Ohio which ranges from 2.765 percent to 3.990 percent but there are jurisdictions such as municipal and school districts which take local income taxes and it can be up to an extra 3%.
The state income tax rate for Ohio does not give much burden as it is in a bracket of 3.99% hence it is very low when compared to other states.
Some states may not have any taxes but if they wish to have, they may have a flat tax rate or a marginal tax rate. Ohio does not operate a corporate income tax system but it does levy a gross receipts tax. Ohio’s tax system ranks 37th overall in the 2022 State Business Tax Climate Index State income taxes.
In the course of reading, you will learn about the income tax rate for Ohio, their exemptions, deductions, credits, and municipal income tax rates.
About Ohio Taxes On Income
The Income Tax Rate for Ohio has reduced to 3.99% from a high rate of 4.997% just a few years ago. In Ohio, you are required to pay taxes as far as you receive income directly from Ohio whether you’re a resident or nonresident. The 2021 state income tax rates range from 2.765% to 3.99%.
The tax brackets continue to be joined together and this leads to a reduction of the tax brackets from an apex level of nine to five this year. This year, the Ohio tax rates remained static, however, the income tax brackets increased because of the annual inflation adjustment.
Ohio State also offers tax deductions and credits to minimize your tax liability, including a personal exemption, credits for 529 contributions, and more.
Ohio income tax rate and tax brackets shown below are stated based on income earned between January 1, 2022, through December 31, 2022. For 2023, Ohio’s growth trend income tax rate will be static because of the ever-rising income tax brackets and an annual inflation adjustment.
Ohio Single Income Tax Brackets
Income Tax Bracket and Tax Rate
- $0-$25,000 – 0%
- $25,001-$44,250 – 2.765%
- $44,251-$88,450 – 3.226%
- $88,451-$110,650 – 3.688%
- $110,651 and more – 3.99%
Ohio Married Filing Jointly Tax Brackets
- $0-$25,000 – 0%
- $25,001-$44,250 – 2.765%
- $44,251-$88,450 – 3.226%
- $88,451-$110,650 – 3.688%
- $110,651 and more – 3.99%
Ohio Married Filing Separately Tax Brackets
- $0-$25,000 – 0%
- $25,001-$44,252 – 2.765%
- $44,251-$88,450 – 3.226%
- $88,451-$110,650 – 3.688%
- $110,651 and more 3.99%
Head of Household Tax Brackets for Ohio
- $0-$25,000 – 0%
- $25,001-$44,250 – 2.765%
- $44,251-$88,450 – 3.226%
- $88,451-$110,650 – 3.688%
- $110,651 and more – 3.99%
Source: 2022 Ohio Tax Rate Schedule, published by the Ohio Department of Taxation.
From the above information, it is clear that there is a progressive style of income tax rate for Ohio state, ranging from 0% to the highest level of 3.99%, and they also collect the same individual income taxes for Single, Married, and Head of Household filing statuses.
It is worth noting that some cities in Ohio have their own income taxes as well, which are included in any state tax.
Ohio school districts also can impose income taxes for reasons of financial support. This tax is added to any state and city income or property taxes. As of January 2022, about 210 school districts imposed an income tax.
Income Tax Deductions for Ohio
Some of the Ohio income tax deductions are listed below.
Personal and Dependent Exemptions
You claim an exemption for the eligible people in your household. Ohio permits you, your spouse (if you’re filing jointly), and the dependents you have to exempt yourselves on your federal tax return. Hence:
- For $0-$40,000 income, it is $2,400
- For $40,001-$80,000 income, it is $2,150
- For $80,000 income, it is $1,900
Federal Itemized Deductions
Your state income tax rate in Ohio is calculated using your federally adjusted gross income, which already includes your federal deductions so you can’t take away federal itemized deductions in your Ohio state tax return.
529 Plan Account Deduction
Up to $4,000 in contributions to an Ohio 529 savings plan can be taken away from each beneficiary annually. Contributions that are more than $4,000 can be brought forward and subtracted from future returns until they are fully used, and they will also be under the $4,000 per beneficiary yearly limit.
STABLE Account Deduction
Up to $4,000 in contributions to an Ohio STABLE account can be taken away from each beneficiary annually. Any contribution which is more than $4,000 will be brought forward and subtracted on future returns though they’ll still be subject to the $4,000 per beneficiary yearly limit.
Ohio State Income Tax Credits
The following are Ohio state income tax credits. They are nonrefundable- this entails that if they surpass the amount of taxes you owe, they cannot move any motion for a tax refund.
Although some states, such as California, offer refunds to taxpayers, you can learn more about the California tax refund.
Retirement Income Credit
If you received income from a pension, profit-sharing plan, or retirement plan, you are eligible for a credit of up to $200. Your modified gross income, with fewer exemptions, must be less than $100,000.
Senior Citizen Credit
You are qualified to get a $50 credit per return if you’re 65 years of age or older at the end of the tax year, and your modified gross income, with fewer exemptions, is under $100,000. You will not be granted this credit if you have taken a lump sum distribution credit before.
Lump Sum Distribution Credit
This credit is given just once in the lifetime of an individual. You can claim this credit if you are 65 or older, have a changed adjusted gross income and fewer exemptions, and received a total lump-sum distribution from a qualified pension, retirement, or profit-sharing plan.
Lump Sum Retirement Credit
This credit can only be given once in a lifetime. If you received a total, lump sum distribution on account of retirement, and your adjusted gross income, minus exemption, is less than $100,000 you can claim this credit.
Child Care And Dependent Care Credit
If your altered adjusted gross income is less than $40,000 you can collect this credit on your Ohio state tax return and you can collect this credit on your federal return.
Campaign Contribution Credit
The credit equals the amount contributed during the tax year up to $50 per return, or $100 if you’re filing jointly. You can collect this credit if you contributed to a campaign committee of qualifying Ohio offices (such as the governor, secretary of state, Ohio Senate or House of Representatives, etc.). Contributions to federal candidates (such as the president or a U.S. senator) are not eligible for this credit.
Exemption Credit
You can get this credit if your altered adjusted gross income, minus exemptions, is below $30,000. The credit is equal to $20 per exemption claimed on your return. For example, if you are eligible for an exemption for you and your spouse, you may qualify for a $40 ($20 x 2) exemption credit.
Joint Filing Credit
You and your partner must have at least $500 of qualifying income each to be eligible for this credit. The credit is equal to a percentage of your tax liability with a maximum credit amount of $650.
Earned Income Tax Credit
If you claim the Earned Income Tax Credit (EITC) on your federal return, you will receive 30% of that amount back on your Ohio state income tax return. So if your federal EITC is $2,000, you’re entitled to $600 on your Ohio return.
Home School Expenses Credit
You can collect credit for up to $250 of the costs of books, subscriptions, school supplies, etc. that you buy for your dependent if they are home-schooled. Computers are not added to educational expenses, and students who go to school remotely because of Covid-19 are not qualified for this credit.
Scholarship Donation Credit
On your income tax rate for Ohio state, up to $750 in donations to a qualified scholarship-granting organization can be collected as a credit.
Non-Chartered, Nonpublic School Tuition Credit
This credit is available if you paid school fees for your dependents to attend a non-chartered, nonpublic school and have a federal adjusted gross income (AGI) of less than $100,000. The credit sums up to the lesser of $500 if your federal AGI is less than $50,000, or $1,000 if your federal AGI is $50,000 to $99,999.
Ohio Adoption Credit
You can collect this credit if you adopted a child (under the age of 18) this year who was not your stepchild. The value of the Ohio adoption credit is $1,500 to $10,000 for adoption-related expenses, such as legal fees, medical care expenses for the birth mother or child, etc. This credit is nonrefundable, so you cannot ask for a tax refund, but any part of it that has not been used can be carried forward for up to five consecutive years.
Do I Have to Pay Income Tax in Ohio
It is an obligation for you to pay your income tax rate in your Ohio state tax return if you get your earnings directly from an Ohio source, and you fall into one of the following categories:
- Resident: You’re taken as a resident even if you are temporarily absent from your home in Ohio, no matter how long the absences are or if your basic home is in Ohio.
- Part-year resident: This means that you had resided in Ohio for part of the tax year. Part-year residents have the right to claim the nonresident credit for any earnings made while they were a resident of another state. They’re qualified for the resident credit on any non-Ohio earnings made while living in Ohio, as long as they paid tax on it in another state.
- Nonresident: This means that you have lived in another state for the whole tax year. If you earned Ohio-sourced income, you will have to file an Ohio state tax return, but you’ll be qualified to collect the nonresident credit for all earnings outside Ohio state to avoid paying double tax. However, there is an exception: you are not required to file an Ohio state tax return if the income you got from Ohio state is wages and this is allowed if you live in Indiana, Kentucky, Michigan, Pennsylvania, or West Virginia.
Ohio Municipal Income Tax
The figures below are based on the taxable income used for Ohio state taxes and are all assessed at a flat rate based on the taxable income used for Ohio state taxes. Many municipalities in Ohio collect income taxes at rates of up to 3% in some areas. Listed below are some of Ohio’s biggest cities’ municipal tax rates, also added are the rates for every school district which takes an income tax.
City and Tax Rate
- Aberdeen – 1.00%
- Ada – 1.65%
- Addyston – 1.50%
- Adelphi – 1.00%
- Alexandria – 1.00%
- Avon Lake – 1.50%
- Baltic – 1.50%
- Baltimore – 1.00%
- Barberton -2.25%
- Bay Village – 1.50%
- Bellville – 1.00%
- Belpre – 1.00%
- Brecksville – 2.00%
- Bryan – 1.80%
- Caldwell – 1.00%
- Camden – 1.00%
- Campbell – 2.50%
- DeGraff – 1.00%
- Dennison – 2.00%
- Eastlake – 2.00%
- Eaton – 1.50%
- Edgerton – 1.75%
- Willowick – 2.00%
- Xenia – 2.25%
- Youngstown – 2.75%
How Much is Income Tax Rate for Ohio?
The income tax rate for Ohio state has been reduced to 3.99% from a high rate of 4.997%, so the income tax rate for Ohio in 2022 – 2023 is between 0 and 3.99%. It has five income tax brackets with Ohio tax rates of 0%, 2.765%, 3.226%, 3.688%, and 3.99% for single, married filing jointly, married filing separately, and head of household levels.
Ohio’s income tax rate is considerably low when compared to some other states’ rates. You may check out the income tax rates in California to see the differences.
Ohio Income Tax Rate Married Filing Jointly
- $0-$25,000 – 0%
- $25,001-$44,250 – 2.765%
- $44,251-$88,450 – 3.226%
- $88,451-$110,650 – 3.688%
- $110,651 and more – 3.99%
Conclusion
Ohio has a progressive income tax. Though the state’s income tax rate is very low compared to other states with an income tax, there are Ohio municipalities that charge an additional income tax of up to 3%. They also give income tax deductions and credits when you meet the criteria.
FAQs on Income Tax Rates for Ohio
Yes- Ohio has a progressive income tax, with rates ranging from 2.765%- 3.990% depending on your taxable income
The current tax brackets in Ohio are:
Income Tax Bracket and Tax Rate
$0-$25,000 – 0%
$25,001-$44,250 – 2.765%
$44,251-$88,450 – 3.226%
$88,451-$110,650 – 3.688%
$110,651 and more – 3.99%
The federal tax rate for Ohio single is:
Income Tax Bracket and Tax Rate
$0 – $10,275 – 10%
$10,276 – $41,775 -12%
$41,776 – $89,075 – 22%
$89,076 – $170,050 – 24%
$170,051 – $215,950 – 32%
$215,951 – $539,900 – 35%
$539,901 and more – 37%
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