May Update on Ohio’s COVID-19 Relief Efforts– May 15, 2020 by Hannah Prengler

The past nine weeks have been a challenge for all Ohioans as we navigate unchartered waters. However, our Ohio legislators have not let countless obstacles deter them from identifying means to support businesses and employees.
 
Ohio is presently drafting legislation (SB 308) to provide civil immunity to businesses and healthcare providers in an effort to limit liability and frivolous lawsuits. This will be an important measure as businesses evaluate reopening their doors. In addition, Ohio is considering several sales tax exemption measures (SB 307) that cover COVID-19 related purchases of protection equipment as well as a sales tax holiday period.
 
However, inevitably Ohio — and other states to come — must grapple with tumbling revenue and surging unemployment claims. Governor DeWine recently cut nearly $800 million from the 2020 budget with 50% of these cuts impacting education. While Ohio has not specifically introduced legislation to raise taxes, the longer the pandemic extends, the more likely Ohio will seek opportunities to balance the budget through revenue raisers.
 
See below for an update on key Ohio measures to date.
 
>> Download Cohen & Company’s spreadsheet that outlines and tracks relief efforts, including available grants and loans, identified in the states in which our firm is located.

Real Estate Tax Extensions

A handful of Ohio counties (Belmont, Cuyahoga, Delaware, Franklin, Geauga, Montgomery, Monroe, Paulding and Washington) are offering taxpayers extensions to pay their second half real estate assessments. We anticipate additional counties may provide extensions in the coming weeks.
 
>> Find an updated listing of counties that have notified Ohio of their extension periods

One-Time Liquor Rebate

Ohio is offering Ohio bars and restaurants a one-time $500 rebate to eligible permit holders.
 
>> Find additional details on the rebate

Ohio Bureau of Workers’ Compensation “True-Up” Due May 29

Due to the changing economic conditions and BWC programs, it is important that all employers review their 2019 payroll amounts to confirm accuracy prior to the extended May 29 deadline. Accurate data may reduce or eliminate further 2019 installments.
 
Looking forward, BWC plans defer all private employers’ 2020 estimated annual premium by 20% for the policy year that begins July 1, 2020. Policy installments are based an employer’s 2019 estimated annual premium. If you are an employer that is not impacted by COVID-19, consider reaching out to the BWC at 800.OHIO.BWC to elect out of these automatic deferrals to avoid owing additional premiums next year when the BWC does their 2021 true-up.

Unemployment Available to Independent Contractors

In line with the new federal Pandemic Unemployment Assistance (PUA) program, Ohio began this week offering benefits to many impacted individuals previously ineligible for state unemployment benefits, including self-employed workers, 1099 filers and part-time workers.
 
>> Learn more about the expanded eligibility

Ohio Municipal Withholding by Employers

Pursuant to HB 197, employers are required to continue withholding local income tax based on the employee’s principal place of work city. Employers should not begin withholding at an employer’s place of residence when working there during the pandemic.
 
Employees residing in lower taxing municipalities have begun to inquire whether they can personally file refund claims with their workplace city for the days they worked from home. This may be a possibility, but we are still early into the pandemic. We will continue to monitor guidance and specific Ohio or municipalities will address this topic at a later date.

Nexus Due to Employees Working from Home

Ohio municipalities are waiving net profit nexus when employees work from their homes temporarily during the COVID-19 pandemic.

>> Read “Does Your Company’s New “Work from Home Normal” Create New State Tax Obligations?”

>> Find which jurisdictions have issued nexus guidance to date in our “Teleworking Employees/SALT Nexus - COVID-19 Relief” Chart.

CARES Act and SBA Paycheck Protection Program Loan Conformity

HB 197 brought Ohio in conformity with the CARES Act provisions. Ohio will confirm with the Act unless:

  • The state specifically decouples from an IRC provision or
  • The taxpayer made an IRC conformity election at their year-end.

 Ohio and its municipalities also conform to the internal revenue code related to the Paycheck Protection Program (PPP) loan forgiveness provisions, including IRS Notice 2020-32, which denies a deduction for expenses the PPP loan forgives. However, federal legislation has been introduced in both the House and Senate to honor the intent of loan forgiveness provisions and the deductibility of corresponding expenses.
 
However, keep in mind that debt forgiven may be subject to Ohio Commercial Activity Tax (CAT). Ohio is aware and considering guidance for those employers that qualify for PPP loan forgiveness.

Statute of Limitation Extension

HB 197 provides a tolling applicable to a statute of limitation set to expire between March 9 and July 30, or the date the emergency order ends — whichever is earlier. For example, if a statute is set to expire March 19, which is 10 days after the emergency order began, Ohio will extend a deadline for 10 days after the emergency order ends.
 
>> Learn more on statute of limitation extension

Contact Hannah Prengler at hprengler@cohencpa.com or a member of your service team to discuss this topic further.


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Cohen & Company is not rendering legal, accounting or other professional advice. Information contained in this post is considered accurate as of the date of publishing. Any action taken based on information in this blog should be taken only after a detailed review of the specific facts, circumstances and current law.