Many of the states that are considered “small business friendly” are those states that do not have income tax. Gov. John Kasich tax reforms for Ohio and the proposed elimination on income tax from small business owners, is an attempt to help Ohioans share the wealth of the state. Among other proposed tax initiatives is increasing personal exemption for Ohioans earning less than $40,000. For more news about Gov. Kasich tax plans follow the links below.
COLUMBUS, Ohio — The budget proposal Gov. John Kasich will unveil Monday will include reforms that would eliminate state income tax on nearly all small businesses in Ohio and increase exemption levels for lower- and middle-income Ohioans.
Kasich revealed his plan in an appearance Thursday before a conference of the Ohio Association of Community Action Agencies. He also used the event to highlight initiatives in his budget that will help to lift the poor out of poverty and make Ohio’s welfare programs operate more effectively.
His tax plans, touted as “a comprehensive plan for helping all Ohioans share in our state’s prosperity, call for:
- Elimination of income tax from small businesses — pass through entities such as sole proprietorships and S-corp. companies that report income on the owners’ individual tax returns.
- Increasing the personal exemption for Ohioans earning less than $40,000 a year from $2,200 to $4,000 in 2015.
- Increasing the personal exemption for Ohioans earning $40,000 to $80,000 a year from $1,950 to $2,850.
Governor’s new budget to include the elimination of the state’s income tax for many small businesses
CLEVELAND – Cleveland’s West 25th Street is a large part of the city, no doubt, but it is a large part made up of small parts.
“Half of Cleveland’s jobs are in small businesses,” said Sam McNulty. The Market Garden Brewery founder should know—as a small business owner he is an employer and one who could benefit by Governor John Kasich’s budget proposal to be unveiled Monday.
The plan would eliminate the state income tax on small businesses with annual gross receipts of $2 million or less.
“It’s significant and instead of just sending this off to the state… we’ll be able to efficiently deliver those same dollars to the business, reinvest and again creating jobs,” said McNulty. “What this does is this gives all of us the ability to grow the city even more and really supercharge the renaissance we’re seeing.”
The tax cut would cost the state about $700 million over two years and the income tax exemption another $372 million, a fraction of Ohio’s current $60 billion-plus budget.
Big Tax Cuts For Small Businesses
CINCINNATI (Paula Toti) — Governor John Kasich officially released his new budget proposal on Monday. He says the state is doing better financially and it’s time for income tax cuts for everyone. Under the plan if you make less than $80,000 a year, you would see an increase in the personal exemption you can claim. Tax rates would also be cut under the Governor’s plan, with the top income tax rate under five percent (verses eight and a half). The part of the plan getting the most buzz is to eliminate state income taxes on small business. The tax break on small businesses would be big. However, what a lot of people don’t realize is there is currently a big break. In the 2014 tax year, 75 percent of the first 250 thousand in income is state income tax exempt. Kasich would increase that to 100 percent, and the bigger part may be that it would expand to any company with less than two million in gross receipts. The Cincinnati USA Regional Chamber says that’s 85 percent of its members. While it might not mean every small shop will lower prices, the chamber says it likely means more jobs and investing in the local economy.
