Ohio
Taxes and business formation • USA 2025–2026
TL;DR
Ohio at a glance — 2026 figures
State filing fees and tax position for individuals and companies registered in Ohio.
| Parameter | Value |
|---|---|
| Personal income tax | See the income tax section below |
| LLC formation fee | $99.00 |
| LLC annual report fee | No report required |
| LLC annual report deadline | No report required |
| LLC dissolution fee | $50.00 |
| Corporation formation fee | $50.00 |
| Corporation annual report fee | $99.00 |
State filing fees are set by the Secretary of State and change without notice — the official source is linked in each section below. Federal figures for tax year 2026 are on the 2026 tax cheat sheet.
Updated: August 2026
LLC in Ohio
Corporation in Ohio
Tax system of Ohio
Income Tax
Ohio has a progressive personal income tax with rates ranging from 2.75% to 3.5% (for 2024–2025). The top rate applies to income above $115,300. In addition, most state residents also pay a local municipal income tax that can reach up to 3% depending on the city (for example, in Cleveland and Columbus). Wages, business income, investments, dividends, and rental income are all subject to taxation. Deductions and credits are available, including a Business Income Deduction for small business that exempts the first $250,000 of small business income from taxation ($125,000 for single filers). This state deduction is applied at the individual tax return level and is suitable for sole proprietors and pass-through entities.
Sales Tax
Ohio's base sales tax rate is 5.75%, but with local surcharges (county surtax) the combined rate can reach up to 8%. Sales tax applies to most goods and a number of services, including rentals, communication services, security, and some repair services. Groceries and prescription medications are exempt. Determining the taxable base and the correct sales tax rate can be quite complex and requires a professional approach and knowledge of state law. Our firm provides services for obtaining a Sales Tax Certificate and for preparing and filing the Sales and Use Tax Return. We advise business owners on all matters related to this tax, including registration, calculation, and reporting.
Property Tax
Ohio levies property tax at the county and school district level. The average effective rate is about 1.56% of market value, which is above the national average. Commercial and residential real estate are taxed differently, and properties are reassessed annually.
Business Taxes
Ohio has a unique tax for legal entities — the Commercial Activity Tax (CAT). This is a tax on gross receipts rather than profit and applies to all businesses with annual revenue above $150,000. The CAT rate is: • $150 — a flat fee on revenue between $150,000 and $1,000,000, • 0.26% on gross receipts above $1,000,000. The CAT replaces the traditional corporate income tax and applies to all business structures: C-corporations, S-corporations, LLCs, and sole proprietors. Ohio does not require commercial LLCs and corporations to file an Annual Report.
Excise Taxes
Ohio levies excise taxes on alcohol, tobacco, gasoline, car rentals, and marijuana (under a licensed program).
Favorable Tax Conditions
Despite the presence of personal and municipal income taxes, Ohio offers favorable conditions for small and medium-sized businesses: no traditional corporate tax — replaced with the CAT at a predictable rate — and the Business Income Deduction, which provides significant tax relief for sole proprietors and owners of LLCs and S-corporations.
Compared to Other States
Personal income tax in Ohio is lower than in most states with a progressive scale, especially when the business deduction is factored in. The CAT is a unique gross receipts tax that is favorable for high-margin companies but can be burdensome for businesses with high turnover and low profit. Property tax is above average, especially in urban counties, but the tax structure remains transparent. Ohio also has no estate or gift tax, which is favorable compared with neighboring states (for example, Pennsylvania). Sales tax is moderate, but the tax base is fairly broad.
Frequently asked questions
Does Ohio have a personal income tax?+
Yes. Ohio levies a personal income tax on residents. The current rates and brackets are set out in the income tax section on this page, with a link to the state tax authority — rates are revised by the legislature, so always check the official source before filing.
How much does it cost to register an LLC in Ohio?+
The state filing fee in Ohio is $99.00. On top of that you need a registered agent with a physical address in the state, and FinTaxes charges from $299 for the formation service itself.
When is the annual report due for a Ohio LLC?+
The Ohio annual report fee is No report required, due No report required. Missing it typically triggers a late penalty and, if left unresolved, administrative dissolution of the company.
Do I need to live in Ohio to open an LLC there?+
No. You do not need to live in Ohio — or in the United States at all — to own an LLC registered there. Non-residents can form and own a US LLC; what the state requires is a registered agent with a physical in-state address. Your own tax residency is a separate question and decides which returns you file.
Can FinTaxes file my Ohio state return remotely?+
Yes. FinTaxes prepares and e-files federal and Ohio state returns entirely remotely, for clients anywhere in the US or abroad, as an Authorized IRS e-file Provider.
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