Yours is a common situation. You will not go to jail. You will pay late fees and penalties.
You normally only have to file a return in the city you live in. It is not necessary to file one in the city you work in, if different. Your employer will remit withholding to the city you work in, but you do not file a return unless you're claiming a refund or your employer didn't withhold enough ( both highly unusual). The city you live in will allow a credit or partial credit for the withheld tax you paid to the work location city. You may end up owing your resident city nothing (except late filing fees), but you are still required to file a return. If you live and work in the same city and your employer did withhold the exact correct amount, you usually still have to file a return. Some cities, like Cincinnati, Dayton & Toledo, do not require you to file if the exact amount is withheld. Incidentally, employers are only required to withhold for the work city, although many will voluntarily withhold for the resident city as well. Employees of most big companies, in Ohio, seldom owe any city tax, at tax time (but they still have to file a city return), because the employer holds out exactly the right amount for both work and resident city, taking into account the credit.
To verify or find out if you live in a school district** or city with an income tax enter your address at:
http://www.tax.ohio.gov/Individual/LocalTaxInformation.aspx
Ohio has both School District Income tax (SDIT) and City income tax. The two are not interchangeable. That is, if you paid city tax to your work location city, you cannot use that to get a credit for your SDIT.
