Ohio state income tax
Ohio has a state income tax. It is flat, with a top marginal rate of 2.75%. Ohio's individual (nonbusiness) income tax has been phased down to a single flat rate over three budget cycles, per Ohio Revised Code 5747.02(A)(3). The first $26,050 of taxable nonbusiness income is untaxed (0%) in all years below. Tax year 2024: 2.75% from $26,050-$100,000, then 3.5% above $100,000 (top rate 3.5%). Tax year 2025: 2.75% from $26,050-$100,000, then 3.125% above $100,000 (top rate 3.125%). Tax year 2026 and thereafter (H.B. 96, the FY2026-27 budget): collapsed to one bracket, a flat 2.75% on all nonbusiness income above $26,050 (tax = $332.00 plus 2.75% of the excess). Business income (the pass-through income of an LLC/sole proprietor eligible for Ohio's Business Income Deduction) is taxed separately: the first $250,000 is deductible, then a flat 3% applies above that, distinct from the 2.75% nonbusiness rate. Separately, more than 600 Ohio cities and villages levy their own municipal income tax (commonly 0.5%-3.0%, often collected via RITA or CCA on the state's behalf), which stacks on top of state liability; a municipality cannot exceed a 1% rate without voter approval. Capital gains are taxed as ordinary income (no special lower rate).
Does Ohio have a state income tax?
Yes. Ohio taxes individual income on a flat schedule topping out at 2.75%. Ohio's individual (nonbusiness) income tax has been phased down to a single flat rate over three budget cycles, per Ohio Revised Code 5747.02(A)(3). The first $26,050 of taxable nonbusiness income is untaxed (0%) in all years below. Tax year 2024: 2.75% from $26,050-$100,000, then 3.5% above $100,000 (top rate 3.5%). Tax year 2025: 2.75% from $26,050-$100,000, then 3.125% above $100,000 (top rate 3.125%). Tax year 2026 and thereafter (H.B. 96, the FY2026-27 budget): collapsed to one bracket, a flat 2.75% on all nonbusiness income above $26,050 (tax = $332.00 plus 2.75% of the excess). Business income (the pass-through income of an LLC/sole proprietor eligible for Ohio's Business Income Deduction) is taxed separately: the first $250,000 is deductible, then a flat 3% applies above that, distinct from the 2.75% nonbusiness rate. Separately, more than 600 Ohio cities and villages levy their own municipal income tax (commonly 0.5%-3.0%, often collected via RITA or CCA on the state's behalf), which stacks on top of state liability; a municipality cannot exceed a 1% rate without voter approval.
| Item | Ohio |
|---|---|
| State income tax | Yes, flat |
| Top marginal rate | 2.75% |
| Capital gains | Taxed as ordinary income, up to 2.75% |
| State sales tax | 5.75% (plus local) |
| Avg. property tax rate | 1.36% of home value |
| Estate / inheritance tax | None |
How does Ohio tax capital gains?
Ohio has no separate, lower rate for capital gains. They are taxed as ordinary income at the same rates as your wages, up to 2.75%, on top of federal capital gains tax. See how capital gains tax works in 2026.
What about retirement income in Ohio?
Retirement income is taxed differently from wages in many states. For how Ohio treats Social Security, pensions, and 401(k)/IRA withdrawals, see Ohio retirement taxes.
Sources
- Ohio income tax rates and brackets: Ohio Department of Revenue / Taxation.
- Ohio capital gains treatment: Ohio tax authority.
- Ohio sales tax: Ohio Department of Revenue.