TaxEngine - Basic Instructions for Preparing and Filing Ohio Tax Returns
In preparing the state tax return, most information will carry from the federal return. The income and withholding will carry to the state from entries on the W-2. Be sure the state information has been entered on the W-2 input screen. Other income items will carry from the federal input according to the state designated.
If you have additional information to enter, click on the 'tax forms' button. Input for all the state forms is available.
County and school district number
The list of county and school district names, numbers and rates are available by clicking the 'list of codes' link. The district to enter is the one in which you lived on December 31. This is not necessarily the district where your children attended school. Those who did not live in Ohio at all during 2007 should enter '0000' for the school district number. Part-year residents who moved into Ohio should enter the Ohio school district in which you lived on the last day of the year. If you moved out of Ohio before December 31, enter '9999'. Military personnel should enter the school district number of their Ohio residence, even if the service member is not physically present in Ohio on the last day of the tax year.
Qualifies for Joint Filing Credit
If filing a married filing joint Ohio income tax return, you may qualify for a joint filing credit. Take this credit only if each spouse has qualifying Ohio Adjusted Gross Income (line 3) of $500 or more. Qualifying income does not include income from interest, dividends and distributions, royalties, rents, capital gains, and state or municipal income tax refunds.
This credit will be automatically calculated.
Part-Year Resident
You are considered a part-year resident of Ohio if, during 2007, you moved your permanent home into or out of Ohio. You must pay Ohio income tax on income you earned, received or accrued while living in Ohio.
Nonresident
If you are a resident of another state and worked in Ohio during 2007, you are required to file a Ohio income tax return and are required to pay Ohio income tax on salary wages and other employee compensation for work performed in Ohio.
If you are an Ohio resident but worked in another state, all of your income is subject to tax, no matter where it is earned, except income earned from out-of-state business activity.
Reciprocal State
The following states have reciprocal agreements with Ohio:
· Indiana
· Kentucky
· Michigan
· Pennsylvania
· West Virginia
Where a reciprocal agreement exists, the reciprocal checkbox should be marked on the nonresident state return. Once marked, the program will exclude wages earned in the nonresident state according to the reciprocity agreement. The reciprocal feature is only programmed to work for a full-year nonresident and full-year resident scenario. Part-year resident returns will need to be manually adjusted for reciprocal agreements, if necessary.
Note: Residents of Indiana, Kentucky, Michigan, Pennsylvania, and West Virginia who work in Ohio can claim exemption from withholding for the Ohio income tax by filing Form IT-4NR with their employer. A full-year nonresident living in a border state does not need to file if the nonresident's only Ohio sourced income is wages. File an Ohio nonresident return to claim a refund of taxes withheld in error.