For 2024, the Ohio Commercial Activities Tax (CAT) has been changed so that all businesses may exclude their first $3 million of taxable gross receipts. Starting in 2025 and thereafter, their first $6 million of taxable gross receipts will be excluded. Businesses with gross receipts below that threshold will pay no tax, while businesses with higher gross receipts will pay 0.26% of their receipts in excess of that threshold - effectively repealing the CAT minimum tax. As a result, our middle market and larger businesses will also benefit from the increased exemption levels.
The new law also eliminates calendar year filing, which was principally available to taxpayers with less than $1 million in taxable gross receipts, requiring all taxpayers to file quarterly. This will also be a cost savings to our small business community.
What could this change mean for you? If you have a business with $1 million or less in taxable gross receipts, you’ll save $150 annually. If you are a small business with $1.5 million in taxable gross receipts, you’ll save more than $2,000 annually.
The Toledo Regional Chamber of Commerce advocated for maintaining these changes during the budget process in 2023. With approximately 80% of our members being small businesses, we understand the importance of these businesses to our community and how changes like this can have big impacts.
You are encouraged to consult with your trusted tax advisor or CPA on how these changes may impact your business. The fourth quarter 2023 CAT return is due February 12, 2024.
The Ohio Department of Taxation recommends that you cancel your CAT account if you anticipate having $3 million or less in taxable gross receipts in tax year 2024. You may do so by using the cancelation check box on the tax return or by visiting the Gateway at gateway.ohio.gov and selecting the CAT Cancel Account transaction. When canceling your account, please enter an effective date of December 31, 2023.
Taxpayers are required to file and pay the CAT electronically via the Ohio Business Gateway at gateway.ohio.gov.
Please visit their website at tax.ohio.gov or contact the Ohio Department of Taxation at 1-888-722-8829 with any questions regarding the CAT.
Do you need help with a government agency or navigating the bureaucracy… or have an idea to improve the business climate in the region? Then reach out to the Chamber’s Advocacy & Public Policy team of experts and see how we might be able to help you!
What could this change mean for you? If you have a business with $1 million or less in taxable gross receipts, you’ll save $150 annually. If you are a small business with $1.5 million in taxable gross receipts, you’ll save more than $2,000 annually.
The Toledo Regional Chamber of Commerce advocated for maintaining these changes during the budget process in 2023. With approximately 80% of our members being small businesses, we understand the importance of these businesses to our community and how changes like this can have big impacts.
You are encouraged to consult with your trusted tax advisor or CPA on how these changes may impact your business. The fourth quarter 2023 CAT return is due February 12, 2024.
The Ohio Department of Taxation recommends that you cancel your CAT account if you anticipate having $3 million or less in taxable gross receipts in tax year 2024. You may do so by using the cancelation check box on the tax return or by visiting the Gateway at gateway.ohio.gov and selecting the CAT Cancel Account transaction. When canceling your account, please enter an effective date of December 31, 2023.
Taxpayers are required to file and pay the CAT electronically via the Ohio Business Gateway at gateway.ohio.gov.
Please visit their website at tax.ohio.gov or contact the Ohio Department of Taxation at 1-888-722-8829 with any questions regarding the CAT.
Do you need help with a government agency or navigating the bureaucracy… or have an idea to improve the business climate in the region? Then reach out to the Chamber’s Advocacy & Public Policy team of experts and see how we might be able to help you!
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