Bill addresses PTE withholding rates

Written on Jan 23, 2020

OSCPA staff report

OSCPA member and State Rep. Gary Scherer, CPA, R-Circleville, this week introduced a bill that would adjust withholding rates applied to pass-through entities (PTEs), such as partnerships and S-corporations.

Scherer said House Bill 467 would lower two rates so the tax withheld on behalf of nonresident owners of Ohio- operating PTEs will be more equitable with the current income tax rates – the ultimate tax due.

“Specifically, the bill reduces the rate of tax withheld by PTEs on a percent of its nonresident investors’ distributive income: from 5% to 4% for individual investors and from 8.5% to 4% for non-individual investors,” Scherer wrote in a co-sponsor request. “The state income tax rate on business income above $250,000 is currently 3%, and the top individual rate for tax year 2019 is 4.797%. The proposed 4% withholding rate strikes a balance between these two income tax rates.”

Reps. who signed on as co-sponsors are John Becker, R-Union Township; George Lang, R-West Chester; Scott Lipps, R-Franklin; Craig Riedel, R-Defiance; Mark J. Romanchuk, R-Ontario; and William Seitz, R-Cincinnati.


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  1. David | Feb 01, 2020
    Dare I say....Common sense in Government legislation.
  2. John | Jan 27, 2020
    Much better tax policy than previously. 
  3. Michael Long | Jan 23, 2020
    Sounds reasonable.

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