Tax conformity bill has a jump-start this year

Written on Feb 15, 2018

Provided by Hannah News Service

Sen. Bob Peterson, R-Sabina, presented sponsor testimony on his Senate Bill 22 on Tuesday, legislation which originally passed the Senate a year ago to conform Ohio's tax code to the federal tax code for the 2016 filing year but will now be amended in the House to conform state law to the federal tax code for the 2017 filing year.

H.B. 11 (Scherer) was instead signed into law last year to deal with the 2016 filing year conformity issues.

House Ways and Means Committee Chair Rep. Tim Schaffer (R-Lancaster) noted the bill will have an emergency clause added so it can be effective upon the Governor’s signature.

Peterson indicated that there are only about two provisions from the Tax Cuts and Jobs Act (H.R. 1) that need to be approved for the 2017 filing year; most of the other provisions are applicable to the 2018 filing year. However, several tax provisions signed into law last week in the Bipartisan Budget Act of 2018, H.R. 1892, were retroactively extended for 2017 only and require conformity.

Peterson said that some of the conformity issues identified by the Ohio Department of Taxation include the following which “will be addressed in the form of amendments, which are very technical in nature”:

  • Allowing "businesses to temporarily expense accelerated depreciation on used assets purchased from Sept. 28, 2017 to Dec. 31, 2022 ...."
  • Adding school district income taxes to the already existing conformity statute found in Revised Code Sec. 5701.11.
  • Clarifying that employees of state agencies accessing personal Federal Taxpayer Information (FIT) are subject to the requirement for an FBI background check and fingerprinting.
  • Permitting Ohioans to continue claiming the personal exemption for dependents even though they are no longer claimed on the federal return.
  • Harmonizing "the due date for the aviation fuel dealer report with all other motor fuel reports: all reports will now be due between the 23rd and end of each month. The bill will reinstate incorrectly removed definitions of 'terminal' and 'consumer' in the motor fuel tax sections of the Revised Code." An amendment will also clarify that that those who purchase fuel for resale are required to file the aviation fuel dealers report – not those who purchase for consumption.
  • Requiring "pass through entity [PTE] investors to file a K-1 form at the time of filing their return. This form will help the Ohio Department of Taxation to more quickly identify proof of the investor’s ownership in the PTE and ensure no delay in processing their return."

Peterson said representatives of the Ohio Department of Taxation will testify next week to answer more detailed questions.

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