(The Center Square) – Ohio companies that benefited from state and federal aid during the ongoing COVID-19 pandemic are one step closer to not being forced to pay taxes on that aid.
The Ohio Senate was passed unanimously Senate Act 18, which brings Ohio tax law in line with federal law, streamlines the state’s tax filing process, and ensures money received during the pandemic is not taxed.
“I am very happy that SB 18 has passed the Senate unanimously [Wednesday]”Said Senator Kristina Roegner, R-Hudson, the law’s co-sponsor.” This bill will help streamline the filing process for Ohio taxpayers and ensure they can receive all of the IRS-approved benefits. “
State lawmakers across the country continue to debate whether to tax federal paycheck protection program loans granted by the IRS. Nationwide, these loans are not taxed as income, and businesses can deduct the payroll and other expenses paid with the loans.
States like New Jersey and Iowa plan to exempt PPP loans from state taxes, while others like Virginia continue to debate limits on spending deductions. Other states still have to make decisions.
The Ohio Bill incorporates amendments to the federal tax law that went into effect March 27th into Ohio law. Co-sponsor Tim Schaffer, R-Lancaster said these changes would have a direct impact on tax bases for workers and businesses in Ohio.
“I am proud to be working with Senator Roegner, my Senate colleagues, and the Ohio Department of Taxation to ensure that added complexity does not affect the already challenging Ohio tax system,” said Schaffer. “By making these necessary changes, we are simplifying the process for Ohioans to receive all of the benefits granted by the IRS.”
The bill, endorsed by the National Federation of Independent Business along with the Ohio Department of Taxation, is being sent to the House for review.