What Ohio Small Businesses Need to Know About Taxes in 2023

If you’re a small business owner in Ohio, it’s never too early to start thinking about taxes. Tax laws and regulations are constantly evolving, so it’s important to stay up-to-date on any changes that may affect your business.

This article will provide an overview of what Ohio small businesses need to know about taxes in 2023. Firstly, it’s important to note that Ohio has its own tax system for businesses. In addition to federal taxes, small businesses in Ohio are subject to state and local taxes.

These taxes can include income tax, sales tax, and property tax. Understanding the different types of taxes and their corresponding rates is crucial for managing your business’s finances effectively. So, let’s dive into what you need to know about ohio small business taxes in 2023.

Ohio’s Small Business Tax System

Ohio’s small businesses have unique tax requirements that differ from those of larger corporations. The state offers a range of tax breaks and incentives to support small business growth, but the filing deadlines and regulations can be overwhelming for entrepreneurs who are not familiar with the system.

To start, it is important for small business owners in Ohio to understand the different types of taxes they may need to pay. These include income tax, sales tax, and employer taxes such as unemployment insurance and workers’ compensation.

The state also offers various tax credits and deductions, such as the Job Creation Tax Credit and the Research and Development Credit, which can help offset some of these costs. However, in order to take advantage of these benefits, it is crucial to stay up-to-date on filing deadlines and eligibility criteria.

Navigating Ohio’s small business tax system may seem daunting at first, but with proper planning and organization, it can be manageable for entrepreneurs. Staying informed about changes in tax laws and seeking assistance from financial professionals can help ensure compliance while maximizing available benefits.

As Ohio continues to evolve its policies to support small businesses, it is essential for entrepreneurs to stay informed in order to make informed decisions about their finances.

Types Of Taxes For Ohio Small Businesses

As previously discussed, Ohio’s small business tax system can be complex and overwhelming. However, it is crucial for small business owners to understand the types of taxes they are responsible for paying.

In this section, we will explore the different types of taxes that Ohio small businesses need to know about.

One important aspect of Ohio’s tax system is the requirement for quarterly tax payments. Small businesses are expected to make estimated payments four times a year based on their projected income and expenses.

Additionally, small businesses may be eligible for various tax deductions such as home office deductions or deductions for equipment purchases. It is essential for small business owners to keep detailed records and work with a trusted accountant to ensure they are taking advantage of all available deductions while staying compliant with tax laws.

Income Tax For Ohio Small Businesses

As an Ohio small business owner, you need to be aware of the income tax requirements set forth by the state. Your business will be subject to state income taxes, which are based on your net income. Tax deductions and credits can be utilized to reduce your taxable income.

To ensure that you are meeting your tax obligations, it is important to make estimated payments throughout the year. This can help prevent any surprise tax bills at the end of the year.

Additionally, understanding the tax brackets for Ohio small businesses can help you plan accordingly and potentially save money in taxes. By staying up-to-date with these requirements, you can avoid penalties and keep your financials in order.

Sales Tax For Ohio Small Businesses

As we have discussed in the previous section, Ohio small businesses must be mindful of their income tax obligations. However, it’s not just income tax that they need to take into consideration.

Sales tax is also an important aspect of taxation that businesses must pay attention to. Sales tax is a type of consumption tax that is imposed on the sale of goods and services. In Ohio, the state sales tax rate is 5.75%, but local taxes may apply, which can increase the total sales tax rate up to 8%.

It’s worth noting that some items are exempt from sales tax, such as certain food items and prescription drugs. Ohio small businesses must also be aware of their filing deadlines for sales tax returns to avoid penalties and interest charges. The state requires monthly or quarterly filing depending on the volume of sales made by the business.

Property Tax For Ohio Small Businesses

As a small business owner in Ohio, property tax is another important tax to consider. Property taxes are levied on real estate and can be a significant expense for businesses that own their building or lease space.

However, there are some exemptions available that could reduce your property tax burden. One exemption is the Ohio Business Income Deduction, which allows eligible businesses to deduct up to $250,000 of business income from their property value assessment.

Additionally, if you are located in an area designated as a Community Reinvestment Area (CRA), you may be eligible for additional property tax incentives.

It’s important to research and understand all of the available exemptions and incentives before submitting your property tax payment. If you believe your property has been overvalued or misclassified for tax purposes, you can also file an appeal with the county auditor’s office within 30 days of receiving your assessment notice.


In conclusion, Ohio small businesses must be informed about the state’s tax system to avoid any penalties or legal issues.

As mentioned earlier, Ohio imposes various taxes such as income tax, sales tax, and property tax on small businesses. These taxes can be complex and require proper monitoring and management.

It is crucial for small business owners to keep track of their finances and consult with professionals if they need assistance in complying with Ohio’s tax laws.

In summary, understanding Ohio’s small business taxes is essential for effective financial management. By staying up-to-date with the latest tax regulations, small business owners can save money and avoid legal issues in the future.

As a result, it is recommended that all small business owners take proactive steps to ensure compliance with Ohio’s tax laws in 2023 and beyond.

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