Ohio Code 5747.41 – Withholding tax on qualifying pass-through entity or trust having individual qualifying investor or beneficiary
For the same purposes for which the tax is levied under section 5747.02 of the Revised Code, there is hereby levied a withholding tax on every qualifying pass-through entity having at least one qualifying investor who is an individual and on every qualifying trust having at least one qualifying beneficiary who is an individual. The withholding tax imposed by this section is imposed on the sum of the adjusted qualifying amounts of a qualifying pass-through entity’s qualifying investors who are individuals and on the sum of the adjusted qualifying amounts of a qualifying trust’s qualifying beneficiaries, at a rate equal to the tax rate imposed on taxable business income under division (A)(4)(a) of section 5747.02 of the Revised Code.
Terms Used In Ohio Code 5747.41
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Business income: includes income, including gain or loss, from a partial or complete liquidation of a business, including, but not limited to, gain or loss from the sale or other disposition of goodwill or the sale of an equity or ownership interest in a business. See Ohio Code 5747.01
- Individual: means any natural person. See Ohio Code 5747.01
- state: means the state of Ohio. See Ohio Code 1.59
- Taxable year: means the calendar year or the taxpayer's fiscal year ending during the calendar year, or fractional part thereof, upon which the adjusted gross income is calculated pursuant to this chapter. See Ohio Code 5747.01
The tax imposed by this section applies only if the qualifying entity has nexus with this state under the Constitution of the United States for any portion of the qualifying entity’s qualifying taxable year, and the sum of the qualifying entity’s adjusted qualifying amounts exceeds one thousand dollars for the qualifying entity’s qualifying taxable year.
The tax imposed under this section does not apply to a qualifying pass-through entity that makes an election under division (C) of section 5747.38 of the Revised Code to be subject to the tax levied under that section for the entity’s qualifying taxable year.
Last updated July 28, 2022 at 4:03 PM