To amend sections 5725.98, 5729.98, 5733.01, 5733.98, and 5747.98 and to enact sections 5725.34, 5729.17, 5733.60, and 5747.67 of the Revised Code to authorize a nonrefundable tax credit for hiring and employing previously unemployed individuals.

Section 1.  That sections 5725.98, 5729.98, 5733.01, 5733.98, and 5747.98 be amended and sections 5725.34, 5729.17, 5733.60, and 5747.67 of the Revised Code be enacted to read as follows:

Sec. 5725.34.  (A) For purposes of this section, "credit period" means, in the case of a dealer in intangibles, the calendar year ending on the thirty-first day of December next preceding the day the report is required to be returned under section 5725.14 of the Revised Code and, in the case of a domestic insurance company, the calendar year ending on the thirty-first day of December next preceding the day the annual statement is required to be returned under section 5725.18 of the Revised Code.

(B) A credit is hereby allowed against the tax levied under section 5707.03 and assessed under section 5725.15 of the Revised Code or the tax imposed by section 5725.18 of the Revised Code for a dealer in intangibles or a domestic insurance company that employs an employee meeting each of the following conditions:

(1) The employee was unemployed for the four consecutive weeks immediately preceding the date the employee was hired.

(2) The employee was hired on or after July 1, 2009, but before July 1, 2010.

(3) During employment the employee was lawfully employable in the United States under federal law, as affirmed under division (C) of this section, and resided in this state.

(4) The employee has been employed by the dealer in intangibles or insurance company for twenty-four consecutive months for compensation greater than or equal to the average monthly employment compensation benefits paid to persons receiving unemployment compensation pursuant to Chapter 4141. of the Revised Code.

The credit equals two thousand four hundred dollars for each such employee. The credit shall be claimed for the credit period that includes the last day of the employee's twenty-fourth month of employment. The credit shall be claimed in the order required under section 5725.98 of the Revised Code. The amount of credit claimed may not exceed the tax otherwise due after allowing for all preceding credits in that order. Excess credit is allowed as a credit in each of the ensuing two credit periods, but the amount of any excess credit claimed in a credit period shall be deducted from the balance carried forward. For purposes of determining duration of employment, employment may include not more than thirteen weeks of service for the employer as personnel provided by a person providing employment service as defined under division (JJ) of section 5739.01 of the Revised Code, except that division (JJ)(2) of that section does not apply.

(C) The credit under this section shall not be allowed for a dealer in intangibles or insurance company unless the dealer or insurance company executes a notarized statement affirming that the dealer or insurance company used the federal government's electronic employment verification system, currently known as "E-verify," or a successor system to verify the lawful employment eligibility of each employee on the basis of whom the credit is claimed. The dealer or insurance company shall make the statement available for inspection by the tax commissioner, in the case of a dealer, or by the superintendent of insurance, in the case of an insurance company, upon the commissioner's or superintendent's request.

Sec. 5725.98. (A) To provide a uniform procedure for calculating the amount of tax imposed by section 5725.18 of the Revised Code that is due under this chapter, a taxpayer shall claim any credits and offsets against tax liability to which it is entitled in the following order:

(1) The credit for an insurance company or insurance company group under section 5729.031 of the Revised Code.

(2) The credit for eligible employee training costs under section 5725.31 of the Revised Code.

(3) The credit for hiring an unemployed individual under section 5725.34 of the Revised Code.

(4) The offset of assessments by the Ohio life and health insurance guaranty association permitted by section 3956.20 of the Revised Code.

(4)(5) The refundable credit for Ohio job creation under section 5725.32 of the Revised Code.

(5)(6) The refundable credit under section 5729.08 of the Revised Code for losses on loans made under the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code.

(B) For any credit except the refundable credits enumerated in divisions (A)(4) and (5) of this section, the amount of the credit for a taxable year shall not exceed the tax due after allowing for any other credit that precedes it in the order required under this section. Any excess amount of a particular credit may be carried forward if authorized under the section creating that credit. Nothing in this chapter shall be construed to allow a taxpayer to claim, directly or indirectly, a credit more than once for a taxable year.

Sec. 5729.17.  (A) For purposes of this section, "credit period" means the calendar year ending on the thirty-first day of December next preceding the day the annual statement is required to be returned under section 5729.02 of the Revised Code.

(B) A credit is hereby allowed against the tax assessed under Chapter 5729. of the Revised Code for a foreign insurance company that employs an employee meeting each of the following conditions:

(1) The employee was unemployed for the four consecutive weeks immediately preceding the date of hire.

(2) The employee was hired on or after July 1, 2009, but before July 1, 2010.

(3) During employment the employee was lawfully employable in the United States under federal law, as affirmed under division (C) of this section, and resided in this state.

(4) The employee has been employed by the insurance company for twenty-four consecutive months for compensation greater than or equal to the average monthly employment compensation benefits paid to persons receiving unemployment compensation pursuant to Chapter 4141. of the Revised Code.

The credit equals two thousand four hundred dollars for each such employee. The credit shall be claimed for the credit period that includes the last day of the employee's twenty-fourth month of employment. The credit shall be claimed in the order required under section 5729.98 of the Revised Code. The amount of credit claimed may not exceed the tax otherwise due after allowing for all preceding credits in that order. Excess credit is allowed as a credit in each of the ensuing two credit periods, but the amount of any excess credit claimed in a credit period shall be deducted from the balance carried forward. For purposes of determining duration of employment, employment may include not more than thirteen weeks of service for the employer as personnel provided by a person providing employment service as defined under division (JJ) of section 5739.01 of the Revised Code, except that division (JJ)(2) of that section does not apply.

(C) The credit under this section shall not be allowed for a foreign insurance company unless the company executes a notarized statement affirming that the company used the federal government's electronic employment verification system, currently known as "E-verify," or a successor system to verify the lawful employment eligibility of each employee on the basis of whom the credit is claimed. The insurance company shall make the statement available for inspection by the superintendent of insurance upon the superintendent's request.

Sec. 5729.98. (A) To provide a uniform procedure for calculating the amount of tax due under this chapter, a taxpayer shall claim any credits and offsets against tax liability to which it is entitled in the following order:

(1) The credit for an insurance company or insurance company group under section 5729.031 of the Revised Code.

(2) The credit for eligible employee training costs under section 5729.07 of the Revised Code.

(3) The credit for hiring an unemployed individual under section 5729.17 of the Revised Code.

(4) The offset of assessments by the Ohio life and health insurance guaranty association against tax liability permitted by section 3956.20 of the Revised Code.

(4)(5) The refundable credit for Ohio job creation under section 5729.032 of the Revised Code.

(5)(6) The refundable credit under section 5729.08 of the Revised Code for losses on loans made under the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code.

(B) For any credit except the refundable credits enumerated in divisions (A)(4) and (5) of this section, the amount of the credit for a taxable year shall not exceed the tax due after allowing for any other credit that precedes it in the order required under this section. Any excess amount of a particular credit may be carried forward if authorized under the section creating that credit. Nothing in this chapter shall be construed to allow a taxpayer to claim, directly or indirectly, a credit more than once for a taxable year.

Sec. 5733.01.  (A) The tax provided by this chapter for domestic corporations shall be the amount charged against each corporation organized for profit under the laws of this state and each nonprofit corporation organized pursuant to Chapter 1729. of the Revised Code, except as provided in sections 5733.09 and 5733.10 of the Revised Code, for the privilege of exercising its franchise during the calendar year in which that amount is payable, and the tax provided by this chapter for foreign corporations shall be the amount charged against each corporation organized for profit and each nonprofit corporation organized or operating in the same or similar manner as nonprofit corporations organized under Chapter 1729. of the Revised Code, under the laws of any state or country other than this state, except as provided in sections 5733.09 and 5733.10 of the Revised Code, for the privilege of doing business in this state, owning or using a part or all of its capital or property in this state, holding a certificate of compliance with the laws of this state authorizing it to do business in this state, or otherwise having nexus in or with this state under the Constitution of the United States, during the calendar year in which that amount is payable.

(B) A corporation is subject to the tax imposed by section 5733.06 of the Revised Code for each calendar year that it is so organized, doing business, owning or using a part or all of its capital or property, holding a certificate of compliance, or otherwise having nexus in or with this state under the Constitution of the United States, on the first day of January of that calendar year.

(C) Any corporation subject to this chapter that is not subject to the federal income tax shall file its returns and compute its tax liability as required by this chapter in the same manner as if that corporation were subject to the federal income tax.

(D) For purposes of this chapter, a federally chartered financial institution shall be deemed to be organized under the laws of the state within which its principal office is located.

(E) For purposes of this chapter, any person, as defined in section 5701.01 of the Revised Code, shall be treated as a corporation if the person is classified for federal income tax purposes as an association taxable as a corporation, and an equity interest in the person shall be treated as capital stock of the person.

(F) For the purposes of this chapter, "disregarded entity" has the same meaning as in division (D) of section 5745.01 of the Revised Code.

(1) A person's interest in a disregarded entity, whether held directly or indirectly, shall be treated as the person's ownership of the assets and liabilities of the disregarded entity, and the income, including gain or loss, shall be included in the person's net income under this chapter.

(2) Any sale, exchange, or other disposition of the person's interest in the disregarded entity, whether held directly or indirectly, shall be treated as a sale, exchange, or other disposition of the person's share of the disregarded entity's underlying assets or liabilities, and the gain or loss from such sale, exchange, or disposition shall be included in the person's net income under this chapter.

(3) The disregarded entity's payroll, property, and sales factors shall be included in the person's factors.

(G) The tax a corporation is required to pay under this chapter shall be as follows:

(1)(a) For financial institutions, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or the difference between all taxes charged the financial institution under this chapter, without regard to division (G)(2) of this section, less any credits allowable against such tax.

(b) A corporation satisfying the description in division (E)(5), (6), (7), (8), or (10) of section 5751.01 of the Revised Code that is not a financial institution, insurance company, or dealer in intangibles is subject to the taxes imposed under this chapter as a corporation and not subject to tax as a financial institution, and shall pay the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or the difference between all the taxes charged under this chapter, without regard to division (G)(2) of this section, less any credits allowable against such tax.

(2) For all corporations other than those persons described in division (G)(1)(a) or (b) of this section, the amount under division (G)(2)(a) of this section applicable to the tax year specified less the amount under division (G)(2)(b) of this section:

(a)(i) For tax year 2005, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or the difference between all taxes charged the corporation under this chapter and any credits allowable against such tax;

(ii) For tax year 2006, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or four-fifths of the difference between all taxes charged the corporation under this chapter and any credits allowable against such tax, except the qualifying pass-through entity tax credit described in division (A)(29) and the refundable credits described in divisions (A)(30) to (34) of section 5733.98 of the Revised Code;

(iii) For tax year 2007, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or three-fifths of the difference between all taxes charged the corporation under this chapter and any credits allowable against such tax, except the qualifying pass-through entity tax credit described in division (A)(29) and the refundable credits described in divisions (A)(30) to (34) of section 5733.98 of the Revised Code;

(iv) For tax year 2008, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or two-fifths of the difference between all taxes charged the corporation under this chapter and any credits allowable against such tax, except the qualifying pass-through entity tax credit described in division (A)(29) and the refundable credits described in divisions (A)(30) to (34) of section 5733.98 of the Revised Code;

(v) For tax year 2009, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or one-fifth of the difference between all taxes charged the corporation under this chapter and any credits allowable against such tax, except the qualifying pass-through entity tax credit described in division (A)(29) and the refundable credits described in divisions (A)(30), (31), (32), and (33) of section 5733.98 of the Revised Code;

(vi) For tax year 2010 and each tax year thereafter, no tax.

(b) A corporation shall subtract from the amount calculated under division (G)(2)(a)(ii), (iii), (iv), or (v) of this section any qualifying pass-through entity tax credit described in division (A)(29) and any refundable credits described in divisions (A)(30) to (34) of section 5733.98 of the Revised Code to which the corporation is entitled. Any unused qualifying pass-through entity tax credit is not refundable.

(c) For the purposes of computing the amount of a credit that may be carried forward to a subsequent tax year under division (G)(2) of this section, a credit is utilized against the tax for a tax year to the extent the credit applies against the tax for that tax year, even if the difference is then multiplied by the applicable fraction under division (G)(2)(a) of this section.

(3) Nothing in division (G) of this section eliminates or reduces the tax imposed by section 5733.41 of the Revised Code on a qualifying pass-through entity.

Sec. 5733.60.  A credit is hereby allowed against the tax levied under section 5733.06 of the Revised Code for a taxpayer that employs an employee meeting each of the following conditions:

(A) The employee was unemployed for the four consecutive weeks immediately preceding the date of hire.

(B) The employee was hired on or after July 1, 2009, but before July 1, 2010.

(C) During employment the employee was lawfully employable in the United States under federal law, as affirmed under this section, and resided in this state.

(D) The employee has been employed by the taxpayer for twenty-four consecutive months for compensation greater than or equal to the average monthly employment compensation benefits paid to persons receiving unemployment compensation pursuant to Chapter 4141. of the Revised Code.

The credit equals two thousand four hundred dollars for each such employee. The credit shall be claimed for the taxpayer's taxable year that includes the last day of the employee's twenty-fourth month of employment. The credit shall be claimed in the order required under section 5733.98 of the Revised Code. The amount of credit claimed may not exceed the tax otherwise due after allowing for all preceding credits in that order. Excess credit is allowed as a credit for each of the ensuing two taxable years, but the amount of any excess credit claimed for a taxable year shall be deducted from the balance carried forward. For purposes of determining duration of employment, employment may include not more than thirteen weeks of service for the employer as personnel provided by a person providing employment service as defined under division (JJ) of section 5739.01 of the Revised Code, except that division (JJ)(2) of that section does not apply.

The credit under this section shall not be allowed for a taxpayer unless the taxpayer executes a notarized statement affirming that the taxpayer used the federal government's electronic employment verification system, currently known as "E-verify," or a successor system to verify the lawful employment eligibility of each employee on the basis of whom the credit is claimed. The taxpayer shall make the statement available for inspection by the tax commissioner upon the commissioner's request.

Sec. 5733.98.  (A) To provide a uniform procedure for calculating the amount of tax imposed by section 5733.06 of the Revised Code that is due under this chapter, a taxpayer shall claim any credits to which it is entitled in the following order, except as otherwise provided in section 5733.058 of the Revised Code:

(1) For tax year 2005, the credit for taxes paid by a qualifying pass-through entity allowed under section 5733.0611 of the Revised Code;

(2) The credit allowed for financial institutions under section 5733.45 of the Revised Code;

(3) The credit for qualifying affiliated groups under section 5733.068 of the Revised Code;

(4) The subsidiary corporation credit under section 5733.067 of the Revised Code;

(5) The savings and loan assessment credit under section 5733.063 of the Revised Code;

(6) The credit for recycling and litter prevention donations under section 5733.064 of the Revised Code;

(7) The credit for employers that enter into agreements with child day-care centers under section 5733.36 of the Revised Code;

(8) The credit for employers that reimburse employee child care expenses under section 5733.38 of the Revised Code;

(9) The credit for maintaining railroad active grade crossing warning devices under section 5733.43 of the Revised Code;

(10) The credit for purchases of lights and reflectors under section 5733.44 of the Revised Code;

(11) The job retention credit under division (B) of section 5733.0610 of the Revised Code;

(12) The credit for tax years 2008 and 2009 for selling alternative fuel under section 5733.48 of the Revised Code;

(13) The second credit for purchases of new manufacturing machinery and equipment under section 5733.33 of the Revised Code;

(14) The job training credit under section 5733.42 of the Revised Code;

(15) The credit for qualified research expenses under section 5733.351 of the Revised Code;

(16) The credit for hiring an unemployed individual under section 5733.60 of the Revised Code;

(17) The enterprise zone credit under section 5709.66 of the Revised Code;

(17)(18) The credit for the eligible costs associated with a voluntary action under section 5733.34 of the Revised Code;

(18)(19) The credit for employers that establish on-site child day-care centers under section 5733.37 of the Revised Code;

(19)(20) The ethanol plant investment credit under section 5733.46 of the Revised Code;

(20)(21) The credit for purchases of qualifying grape production property under section 5733.32 of the Revised Code;

(21)(22) The export sales credit under section 5733.069 of the Revised Code;

(22)(23) The credit for research and development and technology transfer investors under section 5733.35 of the Revised Code;

(23)(24) The enterprise zone credits under section 5709.65 of the Revised Code;

(24)(25) The credit for using Ohio coal under section 5733.39 of the Revised Code;

(25)(26) The credit for small telephone companies under section 5733.57 of the Revised Code;

(26)(27) The credit for eligible nonrecurring 9-1-1 charges under section 5733.55 of the Revised Code;

(27)(28) For tax year 2005, the credit for providing programs to aid the communicatively impaired under division (A) of section 5733.56 of the Revised Code;

(28)(29) The research and development credit under section 5733.352 of the Revised Code;

(29)(30) For tax years 2006 and subsequent tax years, the credit for taxes paid by a qualifying pass-through entity allowed under section 5733.0611 of the Revised Code;

(30)(31) The refundable credit for rehabilitating a historic building under section 5733.47 of the Revised Code;

(31)(32) The refundable jobs creation credit under division (A) of section 5733.0610 of the Revised Code;

(32)(33) The refundable credit for tax withheld under division (B)(2) of section 5747.062 of the Revised Code;

(33)(34) The refundable credit under section 5733.49 of the Revised Code for losses on loans made to the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code;

(34)(35) For tax years 2006, 2007, and 2008, the refundable credit allowable under division (B) of section 5733.56 of the Revised Code.

(B) For any credit except the refundable credits enumerated in divisions (A)(30) to (34) of this section, the amount of the credit for a tax year shall not exceed the tax due after allowing for any other credit that precedes it in the order required under this section. Any excess amount of a particular credit may be carried forward if authorized under the section creating that credit.

Sec. 5747.67.  A credit is hereby allowed against the tax levied under section 5747.02 of the Revised Code for a taxpayer that employs an employee meeting each of the following conditions:

(A) The employee was unemployed for the four consecutive weeks immediately preceding the date of hire.

(B) The employee was hired on or after July 1, 2009, but before July 1, 2010.

(C) During employment the employee was lawfully employable in the United States under federal law, as affirmed under this section, and resided in this state.

(D) The employee has been employed by the taxpayer for twenty-four consecutive months for compensation greater than or equal to the average monthly employment compensation benefits paid to persons receiving unemployment compensation pursuant to Chapter 4141. of the Revised Code.

The credit equals two thousand four hundred dollars for each such employee. The credit shall be claimed for the taxpayer's taxable year that includes the last day of the employee's twenty-fourth month of employment. The credit shall be claimed in the order required under section 5747.98 of the Revised Code. The amount of credit claimed may not exceed the tax otherwise due after allowing for all preceding credits in that order. Excess credit is allowed as a credit in each of the ensuing two taxable years, but the amount of any excess credit claimed in a taxable year shall be deducted from the balance carried forward. For purposes of determining duration of employment, employment may include not more than thirteen weeks of service for the employer as personnel provided by a person providing employment service as defined under division (JJ) of section 5739.01 of the Revised Code, except that division (JJ)(2) of that section does not apply.

The credit under this section shall not be allowed for a taxpayer unless the taxpayer executes a notarized statement affirming that the taxpayer used the federal government's electronic employment verification system, currently known as "E-verify," or a successor system to verify the lawful employment eligibility of each employee on the basis of whom the credit is claimed. The taxpayer shall make the statement available for inspection by the tax commissioner upon the commissioner's request.

Nothing in this section prohibits or disallows pass-through treatment of the credit by a pass-through entity.

Sec. 5747.98.  (A) To provide a uniform procedure for calculating the amount of tax due under section 5747.02 of the Revised Code, a taxpayer shall claim any credits to which the taxpayer is entitled in the following order:

(1) The retirement income credit under division (B) of section 5747.055 of the Revised Code;

(2) The senior citizen credit under division (C) of section 5747.05 of the Revised Code;

(3) The lump sum distribution credit under division (D) of section 5747.05 of the Revised Code;

(4) The dependent care credit under section 5747.054 of the Revised Code;

(5) The lump sum retirement income credit under division (C) of section 5747.055 of the Revised Code;

(6) The lump sum retirement income credit under division (D) of section 5747.055 of the Revised Code;

(7) The lump sum retirement income credit under division (E) of section 5747.055 of the Revised Code;

(8) The low-income credit under section 5747.056 of the Revised Code;

(9) The credit for displaced workers who pay for job training under section 5747.27 of the Revised Code;

(10) The campaign contribution credit under section 5747.29 of the Revised Code;

(11) The twenty-dollar personal exemption credit under section 5747.022 of the Revised Code;

(12) The joint filing credit under division (G) of section 5747.05 of the Revised Code;

(13) The nonresident credit under division (A) of section 5747.05 of the Revised Code;

(14) The credit for a resident's out-of-state income under division (B) of section 5747.05 of the Revised Code;

(15) The credit for employers that enter into agreements with child day-care centers under section 5747.34 of the Revised Code;

(16) The credit for employers that reimburse employee child care expenses under section 5747.36 of the Revised Code;

(17) The credit for adoption of a minor child under section 5747.37 of the Revised Code;

(18) The credit for hiring an unemployed individual under section 5747.67 of the Revised Code;

(19) The credit for purchases of lights and reflectors under section 5747.38 of the Revised Code;

(19)(20) The job retention credit under division (B) of section 5747.058 of the Revised Code;

(20)(21) The credit for selling alternative fuel under section 5747.77 of the Revised Code;

(21)(22) The second credit for purchases of new manufacturing machinery and equipment and the credit for using Ohio coal under section 5747.31 of the Revised Code;

(22)(23) The job training credit under section 5747.39 of the Revised Code;

(23)(24) The enterprise zone credit under section 5709.66 of the Revised Code;

(24)(25) The credit for the eligible costs associated with a voluntary action under section 5747.32 of the Revised Code;

(25)(26) The credit for employers that establish on-site child day-care centers under section 5747.35 of the Revised Code;

(26)(27) The ethanol plant investment credit under section 5747.75 of the Revised Code;

(27)(28) The credit for purchases of qualifying grape production property under section 5747.28 of the Revised Code;

(28)(29) The export sales credit under section 5747.057 of the Revised Code;

(29)(30) The credit for research and development and technology transfer investors under section 5747.33 of the Revised Code;

(30)(31) The enterprise zone credits under section 5709.65 of the Revised Code;

(31)(32) The research and development credit under section 5747.331 of the Revised Code;

(32)(33) The credit for rehabilitating a historic building under section 5747.76 of the Revised Code;

(33)(34) The refundable credit for rehabilitating a historic building under section 5747.76 of the Revised Code;

(34)(35) The refundable jobs creation credit under division (A) of section 5747.058 of the Revised Code;

(35)(36) The refundable credit for taxes paid by a qualifying entity granted under section 5747.059 of the Revised Code;

(36)(37) The refundable credits for taxes paid by a qualifying pass-through entity granted under division (J) of section 5747.08 of the Revised Code;

(37)(38) The refundable credit for tax withheld under division (B)(1) of section 5747.062 of the Revised Code;

(38)(39) The refundable credit under section 5747.80 of the Revised Code for losses on loans made to the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code.

(B) For any credit, except the refundable credits enumerated in divisions (A)(33) to (38) of this section and the credit granted under division (I) of section 5747.08 of the Revised Code, the amount of the credit for a taxable year shall not exceed the tax due after allowing for any other credit that precedes it in the order required under this section. Any excess amount of a particular credit may be carried forward if authorized under the section creating that credit. Nothing in this chapter shall be construed to allow a taxpayer to claim, directly or indirectly, a credit more than once for a taxable year.

Section 2.  That existing sections 5725.98, 5729.98, 5733.01, 5733.98, and 5747.98 of the Revised Code are hereby repealed.