20 December 2018 Ohio has issued revised withholding tables effective January 1, 2019; 2018 Form W-2 filing reminders For the first time since August 1, 2015, the Ohio Department of Taxation has released revised income tax withholding tables, effective with wages paid on and after January 1, 2019. The revisions are the effect of a directive by Ohio Governor Kasich to align the state's income tax withholding rates with a 6.3% state income tax cut (HB 64) that applied in 2015 but was not structured at that time to reduce the withholding rates. (EY Payroll Newsflash, Vol. 16, #215 (8-3-2015).) "While the extra cash may not amount to more than few dollars in the average worker's paycheck, I think most Ohioans would like to have that money in their own pockets rather than the state's," Tax Commissioner Joe Testa said. Testa said these withholding reductions complete the expansive package of income tax cuts initiated by Governor Kasich that have reduced tax rates by 16% since 2011 and helped save Ohio taxpayers more than $5 billion. According to the Department's news release, the lower withholding rates mean, for example, an Ohio taxpayer with three dependents and taxable wages of $60,000 per year will take home approximately $4.67 more each month for 2019. The supplemental rate of withholding will remain at 3.5% for 2019, as provided for under state regulations. (Ohio Administrative Code 5703-7-10, last revised November 23, 2018.) As in the past, only those employers filing 250 or more calendar year 2018 Forms W-2 (or more than 250 Forms 1099-R) are required to submit Forms W-2 on CD by January 31, 2019. Online filing is not available for filing state Forms W-2 or 1099-R. Paper Form IT 3, Transmittal of Wage and Tax Statements, must accompany the CD. Specifications for filing the 2018 Forms W-2 are available here. All employers are required to maintain copies of Form W-2 and/or Form 1099-R for a period of at least four years from the due date of the forms. If the information is not submitted to the Department on CD, the Department may request W-2s or 1099-Rs periodically when conducting compliance programs. All employers must electronically submit an annual reconciliation for calendar year 2018, Form IT 941, by January 31, 2019. Although federal requirements obligate employers to submit Forms 1099-MISC with nonemployee compensation shown in box 7, Ohio instructs employers not to send information for Forms 1099 (such as 1099-MISC, 1099-B, 1099-Div, etc.) for which Ohio income tax withholding is not required, because the state participates in the combined federal/state program and receives this information from the IRS.
Document ID: 2018-2530 | |||||||||
