My thoughts on this are as follows:
- My mantra is never let the tax tail wag the dog. If this is a good business decision overall, don't make the Ohio depreciation adjustment the overriding factor. Taxes are just one factor.
- Keep in mind that the Ohio bonus depreciation adjustment is timing only. You will get the benefit over the next several years.
- Ohio's tax rate is not bad and is a graduated rate.
- You may want to run the numbers by not taking bonus depreciation. Here you will want to look at the impact on both OK and OH. Keep in mind that OH provides a credit for taxes paid to other states. You will want to run this for the entire time period for the OH addback. Total all years taxes and see where you come out. I understand this will require some assumptions and estimates, but that's how it works.
- Also keep in mind that next year you will most likely have OK income, get the benefit of the partial bonus depreciation deduction on OH and then the credit for taxes paid to other states on OH as well.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
