• House Bill 515 , effective 9 / 21 / 22 – clarified that Ohio residents who have a gain from the sale of an equity or ownership interest in a business is considered business income for Ohio income tax purposes
Why is this important ?
• Makes this income eligible for the Business Income Deduction ( BID ), which could wholly or partially exempt the sale from state taxation
• $ 250k business income cap or 3 % flat tax rate on excess over $ 250k Must be considered an asset sale for Federal Income Tax Purposes Must have materially participated in the business in two of the past five year
• HB 515 is intended to be remedial and clarify existing law – thus , changes should apply to audits , refund applications , reassessment petitions and appeals