OSCPA offered proponent testimony before the House Ways and Means Committee on Tuesday for Senate Bill 246, also known at the SALT cap parity bill.
“S.B. 246 is a win-win for the State of Ohio and for Ohio business owners,” said Director of Tax Policy, Greg Saul, Esq., CAE. “This unique change to Ohio’s tax code will provide a tool for Ohio business owners to obtain potentially significant federal tax benefits with minimal loss to Ohio or municipal tax revenue.”
This OSCPA legislative priority would authorize a pass-through entity (PTE) owner to claim a refundable credit against the owner’s Ohio income tax liability equal to the owner’s proportionate share of the tax paid by the PTE. A change to IRS Notice 2020-75 allows states to enact legislation to clarify that taxes paid by a PTE do not count towards an owner’s $10,000 state and local tax limitation deduction for federal income tax purposes.
In his testimony, Saul stated that this legislation will make Ohio business owners more competitive with their counterparts in the 27 states that have already enacted similar legislation and ensures Ohio taxpayers can immediately benefit from reduced federal income taxes and become more competitive with C corporations operating in Ohio.
The bill was voted out of the Senate unanimously on March 16.
“The sooner this legislation is enacted, the sooner it can level the playing field and benefit Ohio’s business owners and job creators,” Saul said.Click here to see Saul’s testimony.