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| To amend section 5747.02 of the Revised Code to | 1 |
| provide for a permanent income tax rate reduction | 2 |
| of 4% for all tax brackets beginning in 2014. | 3 |
| Section 1. That section 5747.02 of the Revised Code be | 4 |
| amended to read as follows: | 5 |
| Sec. 5747.02. (A) For the purpose of providing revenue for | 6 |
| the support of schools and local government functions, to provide | 7 |
| relief to property taxpayers, to provide revenue for the general | 8 |
| revenue fund, and to meet the expenses of administering the tax | 9 |
| levied by this chapter, there is hereby levied on every | 10 |
| individual, trust, and estate residing in or earning or receiving | 11 |
| income in this state, on every individual, trust, and estate | 12 |
| earning or receiving lottery winnings, prizes, or awards pursuant | 13 |
| to Chapter 3770. of the Revised Code, on every individual, trust, | 14 |
| and estate earning or receiving winnings on casino gaming, and on | 15 |
| every individual, trust, and estate otherwise having nexus with or | 16 |
| in this state under the Constitution of the United States, an | 17 |
| annual tax measured in the case of individuals by Ohio adjusted | 18 |
| gross income less an exemption for the taxpayer, the taxpayer's | 19 |
| spouse, and each dependent as provided in section 5747.025 of the | 20 |
| Revised Code; measured in the case of trusts by modified Ohio | 21 |
| taxable income under division (D) of this section; and measured in | 22 |
| the case of estates by Ohio taxable income. The tax imposed by | 23 |
| this section on the balance thus obtained is hereby levied as | 24 |
| follows: | 25 |
| (1) For taxable years beginning in 2004: | 26 |
| OHIO ADJUSTED GROSS INCOME LESS EXEMPTIONS (INDIVIDUALS) | 27 | ||
| OR | 28 | ||
| MODIFIED OHIO | 29 | ||
| TAXABLE INCOME (TRUSTS) | 30 | ||
| OR | 31 | ||
| OHIO TAXABLE INCOME (ESTATES) | TAX | 32 |
| $5,000 or less | .743% | 33 | ||
| More than $5,000 but not more than $10,000 | $37.15 plus 1.486% of the amount in excess of $5,000 | 34 | ||
| More than $10,000 but not more than $15,000 | $111.45 plus 2.972% of the amount in excess of $10,000 | 35 | ||
| More than $15,000 but not more than $20,000 | $260.05 plus 3.715% of the amount in excess of $15,000 | 36 | ||
| More than $20,000 but not more than $40,000 | $445.80 plus 4.457% of the amount in excess of $20,000 | 37 | ||
| More than $40,000 but not more than $80,000 | $1,337.20 plus 5.201% of the amount in excess of $40,000 | 38 | ||
| More than $80,000 but not more than $100,000 | $3,417.60 plus 5.943% of the amount in excess of $80,000 | 39 | ||
| More than $100,000 but not more than $200,000 | $4,606.20 plus 6.9% of the amount in excess of $100,000 | 40 | ||
| More than $200,000 | $11,506.20 plus 7.5% of the amount in excess of $200,000 | 41 |
| (2) For taxable years beginning in 2005: | 42 |
| OHIO ADJUSTED GROSS INCOME LESS EXEMPTIONS (INDIVIDUALS) | 43 | ||
| OR | 44 | ||
| MODIFIED OHIO | 45 | ||
| TAXABLE INCOME (TRUSTS) | 46 | ||
| OR | 47 | ||
| OHIO TAXABLE INCOME (ESTATES) | TAX | 48 |
| $5,000 or less | .712% | 49 | ||
| More than $5,000 but not more than $10,000 | $35.60 plus 1.424% of the amount in excess of $5,000 | 50 | ||
| More than $10,000 but not more than $15,000 | $106.80 plus 2.847% of the amount in excess of $10,000 | 51 | ||
| More than $15,000 but not more than $20,000 | $249.15 plus 3.559% of the amount in excess of $15,000 | 52 | ||
| More than $20,000 but not more than $40,000 | $427.10 plus 4.27% of the amount in excess of $20,000 | 53 | ||
| More than $40,000 but not more than $80,000 | $1,281.10 plus 4.983% of the amount in excess of $40,000 | 54 | ||
| More than $80,000 but not more than $100,000 | $3,274.30 plus 5.693% of the amount in excess of $80,000 | 55 | ||
| More than $100,000 but not more than $200,000 | $4,412.90 plus 6.61% of the amount in excess of $100,000 | 56 | ||
| More than $200,000 | $11,022.90 plus 7.185% of the amount in excess of $200,000 | 57 |
| (3) For taxable years beginning in 2006: | 58 |
| OHIO ADJUSTED GROSS INCOME LESS EXEMPTIONS (INDIVIDUALS) | 59 | ||
| OR | 60 | ||
| MODIFIED OHIO | 61 | ||
| TAXABLE INCOME (TRUSTS) | 62 | ||
| OR | 63 | ||
| OHIO TAXABLE INCOME (ESTATES) | TAX | 64 |
| $5,000 or less | .681% | 65 | ||
| More than $5,000 but not more than $10,000 | $34.05 plus 1.361% of the amount in excess of $5,000 | 66 | ||
| More than $10,000 but not more than $15,000 | $102.10 plus 2.722% of the amount in excess of $10,000 | 67 | ||
| More than $15,000 but not more than $20,000 | $238.20 plus 3.403% of the amount in excess of $15,000 | 68 | ||
| More than $20,000 but not more than $40,000 | $408.35 plus 4.083% of the amount in excess of $20,000 | 69 | ||
| More than $40,000 but not more than $80,000 | $1,224.95 plus 4.764% of the amount in excess of $40,000 | 70 | ||
| More than $80,000 but not more than $100,000 | $3,130.55 plus 5.444% of the amount in excess of $80,000 | 71 | ||
| More than $100,000 but not more than $200,000 | $4,219.35 plus 6.32% of the amount in excess of $100,000 | 72 | ||
| More than $200,000 | $10,539.35 plus 6.87% of the amount in excess of $200,000 | 73 |
| (4) For taxable years beginning in 2007: | 74 |
| OHIO ADJUSTED GROSS INCOME LESS EXEMPTIONS (INDIVIDUALS) | 75 | ||
| OR | 76 | ||
| MODIFIED OHIO | 77 | ||
| TAXABLE INCOME (TRUSTS) | 78 | ||
| OR | 79 | ||
| OHIO TAXABLE INCOME (ESTATES) | TAX | 80 |
| $5,000 or less | .649% | 81 | ||
| More than $5,000 but not more than $10,000 | $32.45 plus 1.299% of the amount in excess of $5,000 | 82 | ||
| More than $10,000 but not more than $15,000 | $97.40 plus 2.598% of the amount in excess of $10,000 | 83 | ||
| More than $15,000 but not more than $20,000 | $227.30 plus 3.247% of the amount in excess of $15,000 | 84 | ||
| More than $20,000 but not more than $40,000 | $389.65 plus 3.895% of the amount in excess of $20,000 | 85 | ||
| More than $40,000 but not more than $80,000 | $1,168.65 plus 4.546% of the amount in excess of $40,000 | 86 | ||
| More than $80,000 but not more than $100,000 | $2,987.05 plus 5.194% of the amount in excess of $80,000 | 87 | ||
| More than $100,000 but not more than $200,000 | $4,025.85 plus 6.031% of the amount in excess of $100,000 | 88 | ||
| More than $200,000 | $10,056.85 plus 6.555% of the amount in excess of $200,000 | 89 |
| (5) For taxable years beginning in 2008, 2009, or 2010: | 90 |
| OHIO ADJUSTED GROSS INCOME LESS EXEMPTIONS (INDIVIDUALS) | 91 | ||
| OR | 92 | ||
| MODIFIED OHIO | 93 | ||
| TAXABLE INCOME (TRUSTS) | 94 | ||
| OR | 95 | ||
| OHIO TAXABLE INCOME (ESTATES) | TAX | 96 |
| $5,000 or less | .618% | 97 | ||
| More than $5,000 but not more than $10,000 | $30.90 plus 1.236% of the amount in excess of $5,000 | 98 | ||
| More than $10,000 but not more than $15,000 | $92.70 plus 2.473% of the amount in excess of $10,000 | 99 | ||
| More than $15,000 but not more than $20,000 | $216.35 plus 3.091% of the amount in excess of $15,000 | 100 | ||
| More than $20,000 but not more than $40,000 | $370.90 plus 3.708% of the amount in excess of $20,000 | 101 | ||
| More than $40,000 but not more than $80,000 | $1,112.50 plus 4.327% of the amount in excess of $40,000 | 102 | ||
| More than $80,000 but not more than $100,000 | $2,843.30 plus 4.945% of the amount in excess of $80,000 | 103 | ||
| More than $100,000 but not more than $200,000 | $3,832.30 plus 5.741% of the amount in excess of $100,000 | 104 | ||
| More than $200,000 | $9,573.30 plus 6.24% of the amount in excess of $200,000 | 105 |
| (6) For taxable years beginning in 2011 or 2012: | 106 |
| OHIO ADJUSTED GROSS INCOME LESS EXEMPTIONS (INDIVIDUALS) | 107 | ||
| OR | 108 | ||
| MODIFIED OHIO | 109 | ||
| TAXABLE INCOME (TRUSTS) | 110 | ||
| OR | 111 | ||
| OHIO TAXABLE INCOME (ESTATES) | TAX | 112 |
| $5,000 or less | .587% | 113 | ||
| More than $5,000 but not more than $10,000 | $29.35 plus 1.174% of the amount in excess of $5,000 | 114 | ||
| More than $10,000 but not more than $15,000 | $88.05 plus 2.348% of the amount in excess of $10,000 | 115 | ||
| More than $15,000 but not more than $20,000 | $205.45 plus 2.935% of the amount in excess of $15,000 | 116 | ||
| More than $20,000 but not more than $40,000 | $352.20 plus 3.521% of the amount in excess of $20,000 | 117 | ||
| More than $40,000 but not more than $80,000 | $1,056.40 plus 4.109% of the amount in excess of $40,000 | 118 | ||
| More than $80,000 but not more than $100,000 | $2,700.00 plus 4.695% of the amount in excess of $80,000 | 119 | ||
| More than $100,000 but not more than $200,000 | $3,639.00 plus 5.451% of the amount in excess of $100,000 | 120 | ||
| More than $200,000 | $9,090.00 plus 5.925% of the amount in excess of $200,000 | 121 |
| (7) For taxable years beginning in 2013: | 122 |
| OHIO ADJUSTED GROSS INCOME LESS EXEMPTIONS (INDIVIDUALS) | 123 | ||
| OR | 124 | ||
| MODIFIED OHIO | 125 | ||
| TAXABLE INCOME (TRUSTS) | 126 | ||
| OR | 127 | ||
| OHIO TAXABLE INCOME (ESTATES) | TAX | 128 |
| $5,000 or less | .537% | 129 | ||
| More than $5,000 but not more than $10,000 | $26.86 plus 1.074% of the amount in excess of $5,000 | 130 | ||
| More than $10,000 but not more than $15,000 | $80.57 plus 2.148% of the amount in excess of $10,000 | 131 | ||
| More than $15,000 but not more than $20,000 | $187.99 plus 2.686% of the amount in excess of $15,000 | 132 | ||
| More than $20,000 but not more than $40,000 | $322.26 plus 3.222% of the amount in excess of $20,000 | 133 | ||
| More than $40,000 but not more than $80,000 | $966.61 plus 3.760% of the amount in excess of $40,000 | 134 | ||
| More than $80,000 but not more than $100,000 | $2,470.50 plus 4.296% of the amount in excess of $80,000 | 135 | ||
| More than $100,000 but not more than $200,000 | $3,329.68 plus 4.988% of the amount in excess of $100,000 | 136 | ||
| More than $200,000 | $8,317.35 plus 5.421% of the amount in excess of $200,000 | 137 |
| (8) For taxable years beginning in 2014: | 138 |
| OHIO ADJUSTED GROSS INCOME LESS EXEMPTIONS (INDIVIDUALS) | 139 | ||
| OR | 140 | ||
| MODIFIED OHIO | 141 | ||
| TAXABLE INCOME (TRUSTS) | 142 | ||
| OR | 143 | ||
| OHIO TAXABLE INCOME (ESTATES) | TAX | 144 |
| $5,000 or less | 145 | |||
| More than $5,000 but not more than $10,000 | $ |
146 | ||
| More than $10,000 but not more than $15,000 | $ |
147 | ||
| More than $15,000 but not more than $20,000 | $ |
148 | ||
| More than $20,000 but not more than $40,000 | $ |
149 | ||
| More than $40,000 but not more than $80,000 | $ |
150 | ||
| More than $80,000 but not more than $100,000 | $ |
151 | ||
| More than $100,000 but not more than $200,000 | $ |
152 | ||
| More than $200,000 | $ |
153 |
| (9) For taxable years beginning in 2015 or thereafter: | 154 |
| OHIO ADJUSTED GROSS INCOME LESS EXEMPTIONS (INDIVIDUALS) | 155 | ||
| OR | 156 | ||
| MODIFIED OHIO | 157 | ||
| TAXABLE INCOME (TRUSTS) | 158 | ||
| OR | 159 | ||
| OHIO TAXABLE INCOME (ESTATES) | TAX | 160 |
| $5,000 or less | 161 | |||
| More than $5,000 but not more than $10,000 | $ |
162 | ||
| More than $10,000 but not more than $15,000 | $ |
163 | ||
| More than $15,000 but not more than $20,000 | $ |
164 | ||
| More than $20,000 but not more than $40,000 | $ |
165 | ||
| More than $40,000 but not more than $80,000 | $ |
166 | ||
| More than $80,000 but not more than $100,000 | $ |
167 | ||
| More than $100,000 but not more than $200,000 | $ |
168 | ||
| More than $200,000 | $ |
169 |
| In August of each year, the tax commissioner shall adjust the | 170 |
| income amounts prescribed in this division by multiplying the | 171 |
| percentage increase in the gross domestic product deflator | 172 |
| computed that year under section 5747.025 of the Revised Code by | 173 |
| each of the income amounts resulting from the adjustment under | 174 |
| this division in the preceding year, adding the resulting product | 175 |
| to the corresponding income amount resulting from the adjustment | 176 |
| in the preceding year, and rounding the resulting sum to the | 177 |
| nearest multiple of fifty dollars. The tax commissioner also shall | 178 |
| recompute each of the tax dollar amounts to the extent necessary | 179 |
| to reflect the adjustment of the income amounts. The rates of | 180 |
| taxation shall not be adjusted. | 181 |
| The adjusted amounts apply to taxable years beginning in the | 182 |
| calendar year in which the adjustments are made. The tax | 183 |
| commissioner shall not make such adjustments in any year in which | 184 |
| the amount resulting from the adjustment would be less than the | 185 |
| amount resulting from the adjustment in the preceding year. The | 186 |
| commissioner shall not make such adjustments for taxable years | 187 |
| beginning in 2013, 2014, or 2015. | 188 |
| (B) If the director of budget and management makes a | 189 |
| certification to the tax commissioner under division (B) of | 190 |
| section 131.44 of the Revised Code, the amount of tax as | 191 |
| determined under division (A) of this section shall be reduced by | 192 |
| the percentage prescribed in that certification for taxable years | 193 |
| beginning in the calendar year in which that certification is | 194 |
| made. | 195 |
| (C) The levy of this tax on income does not prevent a | 196 |
| municipal corporation, a joint economic development zone created | 197 |
| under section 715.691, or a joint economic development district | 198 |
| created under section 715.70 or 715.71 or sections 715.72 to | 199 |
| 715.81 of the Revised Code from levying a tax on income. | 200 |
| (D) This division applies only to taxable years of a trust | 201 |
| beginning in 2002 or thereafter. | 202 |
| (1) The tax imposed by this section on a trust shall be | 203 |
| computed by multiplying the Ohio modified taxable income of the | 204 |
| trust by the rates prescribed by division (A) of this section. | 205 |
| (2) A resident trust may claim a credit against the tax | 206 |
| computed under division (D) of this section equal to the lesser of | 207 |
| (1) the tax paid to another state or the District of Columbia on | 208 |
| the resident trust's modified nonbusiness income, other than the | 209 |
| portion of the resident trust's nonbusiness income that is | 210 |
| qualifying investment income as defined in section 5747.012 of the | 211 |
| Revised Code, or (2) the effective tax rate, based on modified | 212 |
| Ohio taxable income, multiplied by the resident trust's modified | 213 |
| nonbusiness income other than the portion of the resident trust's | 214 |
| nonbusiness income that is qualifying investment income. The | 215 |
| credit applies before any other applicable credits. | 216 |
| (3) The credits enumerated in divisions (A)(1) to (13) of | 217 |
| section 5747.98 of the Revised Code do not apply to a trust | 218 |
| subject to division (D) of this section. Any credits enumerated in | 219 |
| other divisions of section 5747.98 of the Revised Code apply to a | 220 |
| trust subject to division (D) of this section. To the extent that | 221 |
| the trust distributes income for the taxable year for which a | 222 |
| credit is available to the trust, the credit shall be shared by | 223 |
| the trust and its beneficiaries. The tax commissioner and the | 224 |
| trust shall be guided by applicable regulations of the United | 225 |
| States treasury regarding the sharing of credits. | 226 |
| (E) For the purposes of this section, "trust" means any trust | 227 |
| described in Subchapter J of Chapter 1 of the Internal Revenue | 228 |
| Code, excluding trusts that are not irrevocable as defined in | 229 |
| division (I)(3)(b) of section 5747.01 of the Revised Code and that | 230 |
| have no modified Ohio taxable income for the taxable year, | 231 |
| charitable remainder trusts, qualified funeral trusts and preneed | 232 |
| funeral contract trusts established pursuant to sections 4717.31 | 233 |
| to 4717.38 of the Revised Code that are not qualified funeral | 234 |
| trusts, endowment and perpetual care trusts, qualified settlement | 235 |
| trusts and funds, designated settlement trusts and funds, and | 236 |
| trusts exempted from taxation under section 501(a) of the Internal | 237 |
| Revenue Code. | 238 |
| Section 2. That existing section 5747.02 of the Revised Code | 239 |
| is hereby repealed. | 240 |