Asked about Ohio sales and use tax, ODT filings, Ohio CAT, Ohio exemptions, Ohio nexus, or any request involving Ohio state sales and use tax compliance.
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State sales tax rate
5.75%ORC 5739.02
County permissive tax rate range (minimum)
0.75%ORC Chapters 5739 and 5741
County permissive tax rate range (maximum)
2.25%ORC Chapters 5739 and 5741
Maximum combined Ohio sales/use tax rate (statutory cap)
8.75% maximum combined state, county, and transit-authority rateOhio Department of Taxation Sales and Use Tax page; Ohio small business tax guide
Cuyahoga County (Cleveland) -- county rate
2.25%ORC Chapters 5739 and 5741
Cuyahoga County (Cleveland) -- combined rate
8.00%ORC Chapters 5739 and 5741
Franklin County (Columbus) -- county rate
1.75%ORC Chapters 5739 and 5741
Franklin County (Columbus) -- combined rate
7.50%ORC Chapters 5739 and 5741
Hamilton County (Cincinnati) -- county rate
1.80%ORC Chapters 5739 and 5741
Hamilton County (Cincinnati) -- combined rate
7.55%ORC Chapters 5739 and 5741
Summit County (Akron) -- county rate
1.50%ORC Chapters 5739 and 5741
Summit County (Akron) -- combined rate
7.25%ORC Chapters 5739 and 5741
Montgomery County (Dayton) -- county rate
1.50%ORC Chapters 5739 and 5741
Montgomery County (Dayton) -- combined rate
7.25%ORC Chapters 5739 and 5741
Lucas County (Toledo) -- county rate
1.50%ORC Chapters 5739 and 5741
Lucas County (Toledo) -- combined rate
7.25%ORC Chapters 5739 and 5741
Monthly filing threshold -- tax liability
> $600/monthORC 5739.12
Monthly filing due date
23rd of following monthORC 5739.12
Semi-annual filing threshold -- tax liability
$600 or less/monthORC 5739.12
Semi-annual filing due dates
July 23 / January 23ORC 5739.12
Vendor discount rate for timely filing and payment
0.75% of tax collectedORC 5739.12(B)
Vendor discount cap
No capORC 5739.12(B)
Economic nexus -- gross receipts threshold
$100,000 gross receipts in current or preceding calendar yearORC 5741.01(I)(2)
Economic nexus -- transaction count threshold
200 transactions in current or preceding calendar yearORC 5741.01(I)(2)
Economic nexus effective date
August 1, 2019ORC 5741.01(I)(2)
Marketplace facilitator obligation effective date
January 1, 2020ORC 5739.01(Q)
Late filing/payment penalty
Greater of 10% of tax due or $50ORC 5739.13
Fraud penalty
50% of deficiencyORC 5739.13
Interest rate on underpayments
Federal short-term rate + 5%ORC 5739.13
Vendor license fee
$25 per location per yearORC 5739.17
Vendor license renewal deadline
February 28 (annually)ORC 5739.17
Sourcing rule -- intrastate sales
Origin-based (seller's location)ORC 5739.033
Sourcing rule -- remote/interstate sellers
Destination-based (SST compliant)ORC 5739.033
SaaS / cloud software
Taxable as automatic data processingORC 5739.01(B)(3)(a)
Employment/staffing services
TaxableORC 5739.01(B)(3)(j)
Landscaping/lawn care services
TaxableORC 5739.01(B)(3)(h)
Physical fitness services
TaxableORC 5739.01(B)(3)(k)
Digital products (audio, video, books)
TaxableORC 5739.01(BBB)
Grocery food
Exempt (candy without flour, soft drinks, dietary supplements are taxable)ORC Chapter 5739
Candy containing flour
Exempt (classified as food)ORC Chapter 5739
Candy without flour
TaxableORC Chapter 5739
Soft drinks
Taxable (specifically enumerated)ORC Chapter 5739
Dietary supplements
Taxable (specifically enumerated)ORC Chapter 5739
Clothing
Fully taxable -- no clothing exemptionORC Chapter 5739
Manufacturing equipment (with STEC-B certificate)
ExemptORC Chapter 5739
State tax formula -- state component
Taxable sales x 5.75%ORC 5739.02
Vendor discount formula
Total tax collected x 0.75% (if timely filed and paid)ORC 5739.12(B)
Return form
UST-1 (Universal Sales Tax Return)ORC 5739.12
Use tax rate
Combined state + county rate at location of useORC Chapter 5741
Use tax reporting -- vendors
Report on UST-1ORC Chapter 5741
Use tax reporting -- individuals
Report on IT-1040ORC Chapter 5741
Quick Reference
| Field | Value |
|---|---|
| State | Ohio |
| Tax | Sales and Use Tax (state + county) |
| State rate | 5.75% |
| Local rates | County only (0.75% to 2.25%) -- no city or district taxes |
| Maximum combined rate | Approx. 8.00% (e.g. Cuyahoga County) |
| Sourcing | Origin-based (intrastate); destination-based (remote/SST) |
| Primary legislation | ORC Chapters 5739 (Sales) and 5741 (Use) |
| Tax authority | Ohio Department of Taxation (ODT) |
| Filing portal | https://tax.ohio.gov / Ohio Business Gateway |
| Return form | UST-1 (Universal Sales Tax Return) |
| SST member | Yes -- full member |
| Economic nexus | $100,000 gross receipts OR 200 transactions (effective Aug 1, 2019) |
| Vendor license | Required; $25/location/year; renew by February 28 |
| Contributor | Open Accountants Community |
| Validated by | Pending -- requires Ohio CPA or EA sign-off |
| Skill version | 2.0 |
Key Combined Rates
| County | County Rate | Combined Rate |
|---|---|---|
| Cuyahoga (Cleveland) | 2.25% | 8.00% |
| Franklin (Columbus) | 1.75% | 7.50% |
| Hamilton (Cincinnati) | 1.80% | 7.55% |
| Summit (Akron) | 1.50% | 7.25% |
| Montgomery (Dayton) | 1.50% | 7.25% |
| Lucas (Toledo) | 1.50% | 7.25% |
Taxability Quick Matrix
| Item | Taxable? | Notes |
|---|---|---|
| Tangible personal property | YES | Default taxable |
| SaaS / cloud software | YES | Taxable as automatic data processing (ORC 5739.01(B)(3)(a)) |
| Grocery food | NO | Exempt (but candy without flour, soft drinks, dietary supplements are taxable) |
| Clothing | YES | Fully taxable -- no clothing exemption |
| General services | NO | Most services exempt unless specifically enumerated |
| Employment/staffing services | YES | ORC 5739.01(B)(3)(j) |
| Landscaping/lawn care | YES | ORC 5739.01(B)(3)(h) |
| Physical fitness services | YES | ORC 5739.01(B)(3)(k) |
| Digital products (audio, video, books) | YES | ORC 5739.01(BBB) |
| Manufacturing equipment | NO | Exempt with STEC-B certificate |
Conservative Defaults
| Ambiguity | Default |
|---|---|
| Product taxability unknown | Taxable |
| Service taxability unknown | Exempt (unless enumerated) |
| Sourcing location unknown | Seller's county (origin-based intrastate) |
| Candy vs food unclear | Food (exempt) if contains flour |
| CAT obligation | Escalate -- separate tax |
Taxable Sales
| Pattern | Treatment | Notes |
|---|---|---|
| Electronics / hardware sale | Taxable at combined rate | TPP |
| SaaS subscription / cloud CRM | Taxable | Automatic data processing |
| Staffing / temp agency | Taxable | Employment services |
| Landscaping invoice | Taxable | ORC 5739.01(B)(3)(h) |
| Gym membership | Taxable | Physical fitness service |
| Digital download (movie, music, ebook) | Taxable | Specified digital products |
| Furniture / office equipment | Taxable | TPP |
Exempt Sales
| Pattern | Treatment | Notes |
|---|---|---|
| Grocery food (bread, milk, produce) | Exempt | Not candy, soft drinks, supplements |
| Manufacturing equipment with STEC-B | Exempt | Must have valid certificate |
| Sale to government entity | Exempt | With proper documentation |
| Resale with valid certificate | Exempt | STEC-B or SST Certificate |
| Medical equipment (certain) | Exempt | Check specific exemption |
Candy/Food Classification (SST Standard)
| Item | Classification | Rationale |
|---|---|---|
| Chocolate bar (no flour) | Candy -- TAXABLE | No flour ingredient |
| Chocolate-covered pretzels | Food -- EXEMPT | Contains flour |
| Soft drinks | TAXABLE | Specifically enumerated |
| Dietary supplements | TAXABLE | Specifically enumerated |
| Fresh produce | EXEMPT | Grocery food |
Input: Retailer in Columbus (Franklin County) sells electronics for $800. Combined rate: 7.50%.
Reasoning: Electronics are TPP, taxable. Columbus is Franklin County: 5.75% state + 1.75% county = 7.50%.
Classification: Sales tax = $60.00. Total = $860.00.
Input: Ohio business subscribes to cloud-based CRM. $300/month. Business in Cuyahoga County (8.00%).
Reasoning: SaaS is taxable as automatic data processing service in Ohio.
Classification: Sales tax = $24.00/month.
Input: Vendor timely files and pays $20,000 in Ohio sales tax.
Reasoning: Ohio offers 0.75% vendor discount for timely filing and payment. No cap.
Classification: Discount = $150.00. Net remittance = $19,850.00.
Input: Columbus-based seller ships goods to customer in Cleveland (Cuyahoga County).
Reasoning: Intrastate Ohio sales use origin-based sourcing. Seller charges Franklin County rate (7.50%), not Cuyahoga (8.00%).
Classification: Rate = 7.50% (seller's county).
Filing frequency (ORC 5739.12)
| Frequency | Criteria | Due Date |
|---|---|---|
| Monthly | Tax liability > $600/month | 23rd of following month |
| Semi-annual | Tax liability $600 or less/month | July 23 / January 23 |
Penalties (ORC 5739.13)
| Penalty | Rate |
|---|---|
| Late filing/payment | Greater of 10% of tax due or $50 |
| Fraud | 50% of deficiency |
| Interest | Federal short-term rate + 5% |
Cloud analytics may be taxable as automatic data processing. However, consulting services using technology incidentally may not qualify. Flag for reviewer.
Ohio imposes BOTH sales tax (customer-collected) and CAT (seller's gross receipts). They are separate. Escalate CAT questions.
When taxable and exempt items are sold together, bundling rules determine treatment. Flag for reviewer.
OHIO SALES TAX WORKING PAPER (UST-1)
Business: _______________ Vendor License: ___________
Period: ___________ Filing Frequency: Monthly / Semi-Annual
A. GROSS SALES
A1. Total gross sales ___________
A2. Exempt sales (with certificates) ___________
A3. Taxable sales (A1 - A2) ___________
B. TAX COMPUTATION
B1. State tax (A3 x 5.75%) ___________
B2. County tax (A3 x county rate ___%) ___________
B3. Total tax collected ___________
C. VENDOR DISCOUNT
C1. Discount (B3 x 0.75% if timely) ___________
C2. Net remittance (B3 - C1) ___________
D. USE TAX
D1. Purchases without Ohio tax ___________
D2. Use tax due ___________
REVIEWER FLAGS:
[ ] Vendor license current (renewed by Feb 28)?
[ ] Origin-based sourcing applied for intrastate?
[ ] SST/MTC certificates accepted?
[ ] Candy/food classification verified?
[ ] CAT obligation flagged separately?
Common Ohio Business Narrations
| Narration | Meaning | Classification Hint |
|---|---|---|
| ODT / OHIO DEPT OF TAXATION | Tax payment | Exclude |
| AMAZON / ETSY / SHOPIFY | Marketplace settlement | Check if facilitator collected |
| SQUARE / STRIPE / PAYPAL | Payment processor | Business income |
| OHIO BWC | Workers comp | Exclude |
Present these questions:
ONBOARDING QUESTIONS -- OHIO SALES TAX
1. Do you have an Ohio vendor license? License number?
2. What is your filing frequency (monthly / semi-annual)?
3. What is your nexus type (physical, economic, or both)?
4. Are you a marketplace seller?
5. What types of products or services do you sell in Ohio?
6. Do you sell to exempt entities?
7. Do you have locations, employees, or inventory in Ohio?
8. Which Ohio counties do you sell into?
Key Legislation
| Topic | Reference |
|---|---|
| Sales tax imposition | ORC 5739.02 |
| Use tax | ORC Chapter 5741 |
| Sourcing | ORC 5739.033 |
| Vendor license | ORC 5739.17 |
| Economic nexus | ORC 5741.01(I)(2) |
| Marketplace facilitator | ORC 5739.01(Q) |
| Vendor discount | ORC 5739.12(B) |
| Penalties | ORC 5739.13 |
| CAT (separate) | ORC Chapter 5751 |
Changelog
| Version | Date | Change |
|---|---|---|
| 2.0 | April 2026 | Full rewrite to v2.0 10-section structure; taxability matrix; worked examples; origin-based sourcing detail |
| 1.0 | 2025 | Initial version |
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