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COLUMBUS, Ohio – The Ohio Department of Taxation is advising all Ohio employers to begin using the new state income tax withholding rates that take effect today, so their employees can immediately benefit from tax cuts in recently passed legislation. The alert from Tax Commissioner Joe Testa informs employers that the Ohio Department of Taxation has issued new employer withholding tables to be used for payrolls that end on or after July 1, 2014.
“By reducing income tax withholding rates six months ahead of schedule, Ohio is sending a strong message and directly reinforcing how dedicated we are to continuing to provide even greater relief to Ohio workers,” Testa said. “It is extremely important for Ohio workers to keep more of their hard-earned money, and reducing Ohio’s income taxes is an essential component in our state’s economic recovery,” he said.
The new tables take into consideration the accelerated income tax rate reductions that recently went into effect when House Bill 483 was signed into law. The final 1 percent reduction was previously scheduled to go into effect on January 1, 2015, but has been moved up giving taxpayers the full benefit of the 10 percent income tax cut approved in 2014. The new tables reflect a 1 percent reduction in the withholding rates that have been in effect since September 1, 2013, and are to be used for the remainder of the 2014 calendar year and for all of 2015.
Although employers are not required to adopt the new withholding rates immediately, Testa is urging them to do so to allow their employees to benefit from this tax cut through the additional money they will see in their paychecks. “These additional tax reductions are designed to build on the forward momentum that Ohio has created and continue to improve the lives of all Ohioans in the process.”
The new withholding tables and how-to instructions are posted on the Ohio Department of Taxation’s website.
Regardless of when an employer begins using the new withholding rates, all Ohio workers should realize the full benefit of the income tax cut by the time that they file their 2014 state tax returns early next year. Employers that have questions about the new withholding tables should contact the Ohio Department of Taxation at 1-800-304-3211.