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Ohio Legislature Passes "Bright-Line" Residency Test
As one of its last pieces of business the Ohio Legislature passed a law, effective for 2007,
which both made it easier to establish non-residency in Ohio and made the determination of
that status more certain. Naturally, residency status is critical for both Ohio Income Tax
and Ohio Estate Tax. The purpose of legislation was to encourage individuals whose residency
was in question to be able to spend more time, and consequently more money in Ohio, without
concern about increasing their overall tax liability.
The new law makes two significant changes. The first eliminates any subjective tests to
determine residency in favor of a "bright-line test" starting January 1, 2007. If a person
has less than 183 contact periods in the State of Ohio, they are not an Ohio resident.
A contact period is defined as any portion of 2 consecutive days in Ohio.
The other change requires anyone desiring to establish non-residency under the new rules to
file a statement positively asserting that he/she meets the criteria for non-residency
by April 15, 2008.
For more information, contact Jennifer Tapia at 216-774-1154 or
jtapia@cohencpa.com.
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