Ohio took an unusual path in business taxation — it eliminated its corporate income tax and replaced it with the Commercial Activity Tax (CAT), a gross receipts tax that applies to virtually all businesses over a minimum revenue threshold. This makes Ohio's compliance structure distinct from most states and requires companies to understand a different tax paradigm.
Biennial Report
Ohio requires most business entities to file a Biennial Report with the Secretary of State every two years. The report is due in odd-numbered years (e.g., 2025, 2027) by December 31. The fee is $25 for domestic LLCs and domestic corporations. Failure to file results in the entity being placed on the "non-compliant" list and eventually canceled. Reinstatement requires paying all delinquent fees plus a $25 reinstatement fee.
Commercial Activity Tax (CAT)
Ohio's CAT under Ohio Revised Code Chapter 5751 applies to every person or entity with taxable gross receipts of $150,000 or more per calendar year from business activities in Ohio. The tax structure:
- Businesses with $150,000–$1,000,000 in Ohio receipts owe a flat $150 minimum CAT.
- Businesses over $1,000,000 owe $150 plus 0.26% of taxable gross receipts above $1,000,000.
- Businesses under $150,000 owe no CAT but may still need to register.
CAT returns are filed quarterly (if annual receipts exceed $1,000,000) or annually (if receipts are $150,000–$1,000,000) through the Ohio Business Gateway. Annual returns are due May 10; quarterly returns are due the 10th of the second month following each quarter.
Ohio Income Tax: Individual and Pass-Through
Ohio imposes an individual income tax on pass-through income under ORC Chapter 5747. Pass-through entities with Ohio-source income must withhold Ohio income tax for nonresident members/partners or file a composite return. The Ohio income tax rates range from 2.765% to 3.99% (2025). Ohio allows a 3% Business Income Deduction for pass-through income, effectively reducing the rate to around 3% for the first $250,000 of qualifying business income.
Ohio Employer Obligations
Ohio employers must register with the Ohio Department of Taxation for income tax withholding and with the Ohio Department of Job and Family Services for unemployment insurance. Ohio's Workers' Compensation is administered by the Bureau of Workers' Compensation and is mandatory for most employers — Ohio operates an exclusive state fund, meaning private workers' comp insurance is not permitted.
Key Deadlines
- Biennial Report: December 31 of odd-numbered years. Fee: $25.
- CAT Annual Return: May 10 (for entities $150,000–$1,000,000 in receipts).
- CAT Quarterly Return: 10th of second month after quarter end (for entities over $1,000,000).
How Compliance Singularity Handles Ohio
Compliance Singularity tracks your Ohio biennial report year and files through the Secretary of State's portal in December. CAT obligations are computed from your gross receipts data and filed through Ohio Business Gateway. The system determines quarterly vs. annual filing frequency based on your revenue tier and adjusts automatically as you cross the $1,000,000 threshold.