Major Changes to Ohio Commercial Activity Tax

The Ohio Department of Taxation recently issued an information release on developments to the state’s commercial activities tax (CAT). The recent legislation impacting the CAT is favorable to small businesses as the CAT filing requirements and thresholds have been changed for tax periods commencing on or after January 1, 2024. The most significant changes for Ohio CAT taxpayers include:

  • The CAT annual minimum tax is eliminated for periods on or after January 1, 2024.
  • The CAT exclusion amount is increased to $3 million for calendar year 2024 and $6 million for calendar years 2025 and beyond.
  • Beginning with tax year 2024, taxpayers with calendar year taxable gross receipts less than the annual exclusion amount will not be required to file a return.
  • Annual filing is no longer required after the 2023 annual return.
  • For tax periods, on or after January 1, 2024, only quarterly CAT returns will be filed.

Taxpayers that anticipate having less than $3 million in taxable gross receipts for 2024 should evaluate cancelling their CAT accounts. If a taxpayer anticipates less than $3 million in taxable gross receipts in 2024, they can cancel their CAT account effective December 31, 2023. Taxpayers cancelling their CAT accounts should ensure their final annual or quarterly returns are filed. The due dates for these final returns will fall after the effective date of their account cancellations.

The information release from the Department includes guidance on group taxpayers and how to cancel a CAT account. There is a chart by tax year with the filing thresholds, exclusions, and annual minimum tax amounts.

If you have questions on Ohio’s CAT or other SALT matters, please contact HBK’s SALT Advisory Group at

About the Author(s)
Matt Dodge is a Senior Manager in the Pittsburgh, Pa., office of HBK CPAs & Consultants. He joined the firm in 2021. His background includes work with a top 100 accounting firm, a firm specializing in sales tax consulting, and a Fortune 500 company. Matt has more than 20 years of experience in state and local tax (SALT) with a focus on sales and use tax. He has served clients in various industries including construction, manufacturing, oil and gas, retail, service providers, and transportation.
Hill, Barth & King LLC has prepared this material for informational purposes only. Any tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or under any state or local tax law or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. Please do not hesitate to contact us if you have any questions regarding the matter.