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OSCPA maintains priorities in final version of state operating budget

Written on Jun 27, 2025

Hannah News contributed to this report

In the early morning hours of June 25, Republican negotiators agreed to a biennial spending plan that will institute a flat-rate income tax and included all OSCPA’s budget priorities. Substitute House Bill 96 was passed later that day by both the Ohio House and Senate. 

The House passed the final FY26-27 budget mostly along party lines. The final vote was 59-38, with Democrats in unified opposition and a small group of Republicans joining them – Reps. Tim Barhorst (R-Ft. Loramine), Levi Dean (R-Xenia), Ron Ferguson (R-Wintersville), Scott Oelslager (R-North Canton) and Michelle Teska (R-Centerville). 

The Senate passed Sub H.B. 96 by a vote of 23-10. Sen. Louis Blessing (R-Cincinnati) joined all Democrats in opposing the budget. 

The final version of Substitute House Bill 96 includes a flat tax on nonbusiness income phased in over two years. Those making above $100,000 will pay 3.125% in tax year 2025, and everyone above $26,050 will pay 2.75% in tax year 2026.   

OSCPA’s budget priorities include: 

  • The alterations to the municipal income tax refund period would allow taxpayers who receive a filing extension on their return date to file refund claims within three years after the extended due date. See TAXCD72
  • A provision adding clarity to ownership requirements for public accounting firms operating under an Employee Stock Ownership Plan (ESOP) structure, which are part of an alternative practice structure (APS). See ACCCD3
  • A provision that allows nonprofit taxpayers with an unextended federal income tax return to extend the initial due date of their municipal net profit tax filing from April 15 to May 15 to match the federal income tax return due date. See TAXCD119.   
  • Finally, the pass-through entity tax provision that would permit an electing PTE tax credit to be claimed by a PTE that owns another PTE that has paid the electing pass-through entity tax (IT 4738) or the traditional composite return (IT 4708). See TAXCD74.    

The budget now heads to Gov. Mike DeWine’s desk for review. He will likely make several line-item vetoes and ultimately sign the bill into law before the start of the new fiscal year, July 1. 

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