Ohio LLC Taxes: The Complete Filing Guide (2025)

Ohio LLC Tax Basics

Navigating your Ohio LLC tax obligations doesn’t have to be complicated. We’ll walk you through the essentials of pass-through taxation, explain Ohio’s specific requirements, and highlight strategies to stay compliant and organized. This guide covers everything from federal income taxes to city-specific requirements and filing deadlines.

Use the links below to jump directly to the section you need:

• Ohio LLC Taxes at a Glance
• Understanding LLC Taxation Basics
• Federal Tax Obligations
• Ohio State Taxes
• Local Tax Considerations
• Tax Calendar and Filing Tips
• Tax Strategies for Ohio LLCs
• Forms and Resources

Ohio LLC Taxes at a Glance

Tax Type	Rate	Filing Deadline	Forms Required
Federal Income Tax	10-37% (personal brackets)	April 15, 2025	Form 1040 + Schedule C or Schedule E/K-1
Self-Employment Tax	15.3%	April 15, 2025	Schedule SE
Ohio Individual Income Tax	0%–3.5%	April 15, 2025	Form IT 1040
Ohio Commercial Activity Tax	0.26% (on gross receipts over $6 million)	Quarterly, or annually (based on gross receipts volume)	Form CAT 1
Ohio Pass-Through Entity Tax	3%	April 15, 2025	Form IT 4738
Federal Payroll Taxes (If Employees)	7.65% employer + 7.65% employee (FICA)	Quarterly (April 30, July 31, October 31, January 31)	Form 941
Ohio Unemployment Tax (If Employees)	0.4%–10.1% (new employers: 2.7%)	Quarterly	Filed online
Federal Unemployment (FUTA)	6% on first $7,000 per employee (0.6% after credits)	January 31, 2026 (annual)	Form 940
Sales & Use Tax	5.75% (+ up to 2.25% local surtaxes)	Monthly, quarterly, or annually based on sales volume	Form UST‑1
Municipal Income Tax	1%-3% (varies by city)	April 15, 2025	Form MNP-R

Understanding LLC Taxation Basics

How Ohio LLCs Are Taxed By Default

Your Ohio LLC doesn’t pay taxes itself. Instead, profits flow through to you and your members, who report them on personal tax returns. This is called pass-through taxation.

Here’s how it works:

1. Your LLC earns income from business activities
2. The LLC itself files no tax return (unless you elect otherwise)
3. Profits “pass through” to members based on ownership percentage
4. Each member reports their share on their personal tax return
5. Members pay tax at their individual income tax rates

What this means for you: Unlike corporations, your business profits are only taxed once, which typically saves money.

Tax Classification Options

While pass-through taxation is the default, your Ohio LLC can choose alternative tax treatments:

Default LLC Tax Status:

• Single-member LLC: Taxed as a sole proprietorship
• Multi-member LLC: Taxed as a partnership

Optional Tax Classifications:

• S Corporation: Can reduce self-employment taxes by paying “reasonable salaries”
• C Corporation: LLC pays corporate tax on profits, members pay personal tax on distributions (creates double taxation)

Ohio Pass-Through Entity Tax Option:

• Optional tax that allows LLCs taxed as partnerships or S Corps to pay tax at the entity level
• Can help overcome the $10,000 SALT deduction limitation
• Election is made annually and cannot be changed once made

Not sure which tax classification is right for your business? Schedule a free consultation with 1-800Accountant.

Federal Tax Obligations

Income Tax

As a Ohio LLC owner, you’ll report your share of business profits on your personal tax return using:

• Form 1040 + Schedule C (single-member LLCs)
• Form 1040 + Schedule E + Schedule K-1 (multi-member LLCs)

Federal income tax rates range from 10% to 37% based on your tax bracket (actual brackets will depend on inflation adjustments and any tax law changes).

Simply Put: Whatever money your business makes (after expenses) gets added to your personal tax return, just like income from a job.

Self-Employment Tax

LLC members actively involved in the business must pay self-employment tax of 15.3% (covering Social Security and Medicare) on their share of LLC profits.

Key points:

• Applies to net earnings of $400 or more
• Calculated on Schedule SE
• You can deduct 50% of the self-employment tax as an “above-the-line” deduction, which lowers your adjusted gross income

What happens if I miss this payment? The IRS charges penalties of 0.5% per month plus interest. However, first-time mistakes can often qualify for penalty abatement if you have a clean compliance history.

Employment Taxes

If your LLC has employees, you must:

• Withhold federal income tax
• Pay and withhold FICA taxes (7.65% each for employer and employee)
• Pay federal unemployment tax (FUTA)
• File quarterly employment tax returns (Form 941)
• Provide W-2 forms annually

Estimated completion time: 2-3 hours per quarter (significantly less with payroll software or professional help)

Estimated Tax Payments

Because no tax is withheld from your LLC profits, you’ll likely need to make quarterly estimated tax payments using Form 1040-ES. These payments cover both income and self-employment taxes on your share of the business income. Missing deadlines or underpaying can lead to IRS penalties, even if you pay in full later.

Working with an accountant can help ensure accurate calculations, on-time payments, and a smarter overall tax strategy.

Key deadlines:

• April 15
• June 16
• September 15
• January 15

Pro Tip: Set calendar reminders 15 days before each deadline. This gives you time to prepare without the last-minute rush that leads to mistakes.

Ohio State Taxes

Ohio Income Tax

Ohio has a personal income tax rate ranging from 0% to 3.5% that applies to your LLC’s profits on your personal return.

Filing requirements:

• Use Ohio Form IT 1040
• Due April 15, 2025
• Ohio follows federal adjusted gross income as a starting point

Bottom Line: For every $1,000 your LLC earns, expect to pay between $27.50 and $39.90 in Ohio state income taxes. However, if your income does not meet the minimum threshold your tax rate is 0%. 

Ohio Pass-Through Entity Tax

This optional tax can benefit many Ohio LLC owners:

• Tax rate: 3% (flat rate)
• Paid by your LLC instead of individual members
• Members receive a tax credit on their personal returns
• Helps bypass the $10,000 SALT deduction limitation
• Must elect by filing Form IT 4738 by April 15, 2025
• Election is binding for the tax year once made

Real Savings Example: For an LLC with $200,000 in profits, the Pass-Through Entity Tax could save owners up to $6,000 in federal taxes by working around the SALT deduction cap.

Sales and Use Tax

If your Ohio LLC sells physical products or certain services:

• Collect 5.75% sales tax (plus up to 2.25% in local surtaxes)
• Register for a vendor’s license through Ohio Business Gateway
• File and pay collected taxes monthly, quarterly, or semiannually based on sales volume
• Due dates vary based on filing frequency

60-Second Check: Do I Need to Collect Sales Tax?

• Do you sell physical products in Ohio? → If yes, collect tax
• Do you sell digital products? → Generally not taxable
• Do you provide services? → Most services are exempt 
• Do you sell online to Ohio customers? → if yes, collect tax

Services typically exempt from sales tax include:

• Professional services (legal, accounting)
• Personal services (haircuts, fitness training)
• Medical services

Products typically subject to sales tax include:

• Tangible personal property
• Prepared food
• Some digital products

Payroll Taxes 

If you have employees in Ohio, you will be responsible for two types of payroll taxes. 

Unemployment Insurance (UI) Tax 

• Register through The SOURCE (Ohio’s unemployment tax portal)
• Rate is 2.7% for new employers (0.4%-10.1% afterwards) 
• Due quarterly

Withholding Tax 

• Register through the Ohio Department of Taxation
• Withhold income tax from employee wages using Ohio withholding tables
• Due monthly or quarterly (depending on total withholding amount)

Commercial Activity Tax 

Ohio’s Commercial Activity Tax is a gross receipts tax that applies to LLCs with more than $6 million of taxable gross receipts from business activity in Ohio. 

• Rate: 0.26% on Ohio gross receipts exceeding $6 million
• File through the Ohio Business Gateway
• Use Ohio Form CAT 1

Note: This tax is based on gross receipts, not profit, so you may owe CAT even if your business operates at a loss.

Local Tax Considerations

Municipal Income Taxes

Ohio allows cities to impose local income taxes, creating a significant compliance burden for many LLC owners.

Cities with income taxes include:

• Columbus (2.5%)
• Cleveland (2.5%)
• Cincinnati (2.1%)
• Toledo (2.25%)
• Over 600 other Ohio municipalities

Filing requirements:

Depending on the city, you’ll need to:

• File via Ohio Business Gateway 
• File through RITA (Regional Income Tax Agency) 
• File directly with individual city 

Property Taxes

If your LLC owns real property in Ohio:

• Rates vary by locality
• Assessed annually
• May qualify for various exemptions based on business type
• Personal property tax may apply to business equipment

Tax Calendar and Filing Tips

Key Deadlines for Ohio LLCs

January:

• January 15: Final estimated tax payment for previous year
• January 31: Fourth quarter Ohio withholding tax due
• January 31: Issue W-2s/1099s to employees/contractors
• January 31: Fourth quarter federal payroll tax payment due 

April:

• April 15: Personal tax returns due
• April 15: Federal income and self-employment tax returns due

• April 15: First quarter estimated tax payment due 
• April 15: Ohio Pass-Through Entity Tax election deadline
• April 30: First quarter federal payroll tax payment due
• April 30: First quarter Ohio UI tax due

June: 

• June 16: Second quarter estimated tax due 

July: 

• July 31: Second quarter Ohio UI tax due
• July 31: Second quarter federal payroll tax payment due 

September:

• September 15: Third quarter estimated tax payment due

October:

• October 31: Third quarter Ohio UI tax due
• October 31: Third quarter federal payroll tax payment due

Record-Keeping Checklist

Keep these records for at least 7 years:

• Business income records (invoices, receipts)
• Expense receipts and documentation
• Bank and credit card statements
• Asset purchase and improvement records
• Vehicle mileage logs
• Home office documentation
• Payroll records
• Previous tax returns

Tax Strategies for Ohio LLCs

S Corporation Election Benefits

Converting your LLC to an S Corporation for tax purposes can save on self-employment taxes:

1. File Form 2553 with the IRS
2. Pay yourself a “reasonable salary” subject to employment taxes
3. Take remaining profits as distributions exempt from self-employment tax

Example: An LLC making $100,000 in profit pays 15.3% self-employment tax on the entire amount. As an S Corp, if $60,000 is a reasonable salary and $40,000 is taken as distributions, only the $60,000 is subject to employment taxes.

Potential Savings: In this example, you’d save about $6,120 in self-employment taxes.

Pass-Through Entity Tax Election

Consider electing Ohio’s Pass-Through Entity Tax if:

• You’re affected by the $10,000 SALT deduction cap
• You expect your LLC to have significant income
• All members agree to the election

Business Expense Deductions

Common deductions Ohio LLC owners often overlook:

• Home office deduction
• Business mileage (70¢ per mile for 2025)
• Health insurance premiums
• Retirement plan contributions
• Professional development expenses
• Business meals (50% deductible)

Forms and Resources

Federal Tax Forms

• Schedule C: Profit or Loss From Business (sole proprietors)
• Form 1065: U.S. Return of Partnership Income
• Schedule K-1: Partner’s Share of Income, Deductions, Credits
• Form 1120-S: U.S. Income Tax Return for an S Corporation
• Form 2553: Election by a Small Business Corporation (S Corp)
• Form 8832: Entity Classification Election

Ohio Tax Forms

• Form IT 1040: Ohio Individual Income Tax Return
• Form IT 4738: Ohio Pass-Through Entity Tax Return
• Form UST‑1: Sales and Use Tax Return

Helpful Resources

• Ohio Department of Taxation
• Ohio Business Gateway
• RITA (Regional Income Tax Agency)
• The SOURCE (Ohio’s unemployment tax portal)
• Internal Revenue Service