Tax Credits for Working Families

Ohio

Earned Income Tax Credit^

Income Tax Rate: Graduated, .618-6.24 percent

State EITC: Yes

Refundable: No

Year Enacted: 2013

Formula: 10 percent of the federal credit, limited to 50 percent of liability for Ohio Taxable Income above $20,000.

News/Notes: In June 2013, Republican lawmakers reached a budget deal that includes the creation of a nonrefundable state EITC at 5 percent of the federal credit and limited to 50 percent of liability for Ohio Taxable Income above $20,000.

In 2014, Gov. John Kasich’s budget bill included a proposal to increase the state’s EITC from 5 to 15 percent of the federal credit. In May, 2014, the Ohio Senate approved a budget bill, HB 483, that includes doubling the state’s Earned Income Tax Credit (EITC) to 10 percent of the federal credit and the governor signed it into law on June 17.

Reports/Materials: Flawed Tax Cuts in Senate Budget Bill, Policy Matters Ohio, May 2014

Cuyahoga County EITC Coalition Evaluation, Policy Matters Ohio, August 2013

Tax plan still rewards affluent, leaves some of poorest Ohioans paying more, Policy Matters Ohio, June 2013

Improving tax preparation with a model fee disclosure box, Policy Matters Ohio, June 2013

Working family tax credits help Ohio’s military families, Policy Matters Ohio, July 2013

Improving tax preparation with a model fee disclosure box, Policy Matters Ohio, June 2013

Schiller testifies on proposed income tax cut, business tax exemption, Policy Matters Ohio, May 2013

Schiller testifies on tax reform, Policy Matters Ohio, May 2013

Rothstein testifies on a state EITC to the House Finance and Appropriations Committee, Policy Matters Ohio, April 2013

Small Investment, Big Difference: Mapping the impact of an Ohio Earned Income Tax Credit, Policy Matters Ohio, April 2013

Small Investment, Big Difference: How an Ohio Earned Income Tax Credit would help working families, Policy Matters Ohio, March 2013

Kasich tax proposal would further tilt tax system in favor of Ohio’s affluent, Policy Matters Ohio, February 2013

Ohio State & Local Taxes, from Who Pays? A Distributional Analysis of the Tax Systems in All 50 States, Institute on Taxation and Economic Policy, January 2013

Who takes credit? The Earned Income Tax Credit in Cuyahoga County, 2012, David Rothstein, Policy Matters Ohio, August 2012

Ohio needs a state earned income credit: 949,000 working families would benefit, Policy Matters Ohio, April 2012

Ohio: State and Local Taxes in 2007, Institute on Taxation and Economic Policy, November 2009

State EITC Fact Sheet, Voices for Ohio’s Children, July 2009

Dollars that Make Sense, Policy Matters Ohio, April 2009

Who Takes Credit: The Earned Income Tax Credit and Free Tax Participation in Ohio, Policy Matters Ohio, January 2008

Getting Ohio’s Working Families the Credit They Deserve: The Earned Income Tax Credit, Policy Matters Ohio, 2006

Child Tax Credit^

State Credit: No

Child and Dependent Care Tax Credit^

State Credit: Yes

Refundable: No

Eligibility: Filers must have income below $40,000. Any expenses that qualify for the federal credit also qualify for the Ohio credit.

Formula: For filers earning less than $20,000, the credit is equal to 100 percent of qualifying expenses. For filers earning between $20,000 and $40,000, the credit equals 25 percent of qualifying expenses.

Notes/News: Ohio’s Child and Dependent Care Credit is not refundable. Advocacy groups are working with legislators to make the credit refundable.

Property Tax Circuit Breaker^

Circuit Breaker: No

Notes/News: In 2007, Ohio removed the income limitations for claiming the homestead exemption for seniors but still has no circuit breaker to protect low-income residents from high property taxes.