Overview of Ohio LLC Taxes
LLCs in Ohio are taxed as pass-through entities at both federal and state levels, with the Ohio Commercial Activity Tax applying to most Ohio business entities.
Taxation of Ohio LLCs
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Federal Taxation:
- Ohio LLCs are federally taxed as pass-through entities, with revenue passing through to members for individual income tax.
- Members are also subject to federal self-employment tax.
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State Taxation:
- Ohio LLCs are subject to company and individual income taxes, as well as potential state business taxes like sales tax.
Commercial Activity Tax (CAT) in Ohio
- The CAT applies to most Ohio business entities, including LLCs, based on gross receipts.
- Minimum CAT rates for Ohio LLCs are dependent on the Taxable Gross Receipt (TGR).
Tax Filing Requirements for Ohio LLCs
- LLCs are required to file state income tax, sales & use tax, and federal taxes.
- LLCs with less than $150,000 gross receipts may be exempt from CAT.
Starting an LLC in Ohio
- Provides liability protection and flexibility in management and taxation.
- Includes steps such as choosing a name, registering with the state, and obtaining necessary licenses and permits.
Filing Ohio Tax Returns
- LLC members pay taxes on income earned from the LLC and self-employment taxes.
- Filing requirements vary for single-member LLCs and multi-member LLCs.
Ohio Tax Filing Guidelines
- LLCs must comply with federal and state tax requirements by filing the appropriate tax forms.
- Ohio business taxes, such as self-employment, payroll, and sales tax, should be carefully reviewed and understood.