The Ohio General Assembly passed a two year pilot program for historic preservation tax credits. The bill awaits the governor's signature. See HB 149. Source: Cuyahoga Planning Commission Weblog, Dec. 19, 2006.
In Information Release CFT 2006-01, the Ohio Department of Taxation addresses the impact of DaimlerChrysler Corp. v. Cuno 547 U.S. ____(2006) and H.B. 66 on Ohio’s tax credit and grant for pre-July 1, 2005 purchases of new manufacturing machinery and equipment for use in Ohio.
Beside making changes to pension laws, the Pension Protection Act of 2006 also made changes to charitable tax deductions. People over 70 1/2 can make a direct charitable contribution from their IRA, shielding some of the income tax effects of an IRA distribution. Stricter rules for noncash charitable donations are imposed, such as requiring the items donated to be in good condition. Appraisals are required for items valued at over $500. No deduction for cash donations are allowed unless the taxpayer can show a letter from the charity or a bank record. Previously, records were only required for donations over $250. New Law Changes Charitable Contributions by Eileen Alt Powell, Findlaw, Sept 20, 2006.
To see the new withholding tables, effective Oct 1, 2006, go to Ohio Department of Taxation Information Release IT2006-03. According to the release, "The reductions in the rates take into consideration the changes to Ohio individual income tax rates enacted in House Bill 66."
The purpose of the CAT tax, which went into effect on July 1, 2005, was to replace the corporate franchise tax and the tangible personal property tax with one, less burdensome tax. The elimination of the tangible personal property tax was intended to benefit manufacturers, who no longer have to pay tax on inventory and equipment. However, the CAT tax has a negative impact on businesses with slim profit margins and high volumes, such as grocery stores. The CAT tax is based on revenue, not profits. The Ohio Grocers Association sued, saying the CAT tax violates the Ohio Constitution's prohibition against taxing food that will be consumed off-premises. See Ohio Gocers Association v. Ohio Tax Commissioner, Franklin County Common Pleas Court Case No. 06 cv 002278 on the Franklin County Docket. The Tax Foundation also feels the CAT tax is unconstitutional because of the way it taxes out of state businesses. A Year Later, Ohio Commercial Activity Tax Still Debated by Alexander Coolidge, Cincinnati Enquirer, July 6, 2006, reprinted in the Zanesville Times Recorder, July 6, 2006. Also see: Marketing Tax Nexus? by Chris Atkins, Tax Foundation Blog, Nov. 2, 2005; Companies Tally New Tax's Cost by Roger Metzger, The Plain Dealer, Sept. 25, 2005 via the Greater Cleveland Automobile Dealers Website.
Governor Taft signed HB 390, which establishes time limits for assessing certain unpaid state taxes and time limits for judicial proceedings after an assessment. The act restores a prior time limit for the state to take action on a debt due to it, but the time limit is lengthened to twelve years. The act also "Provides for relieving "innocent spouses" from joint and several liability for income taxes under a compromise of claim or payment-over-time agreement." See Final LSC Analysis; Governor Taft News Release, dated June 28, 2006.
According to Governor Taft News Release, June 20, 2006, the governor signed Sub SB 269, which "exempts from the use tax items held by a person, but not for that person's own use and donated to a charitable organization, or to the state or its political subdivisions for exclusively public purposes".