topic allocating income to Ohio tax return in State tax filing

allocating income to Ohio tax return

llabah — Wed, 21 Feb 2024 15:14:32 GMT

I live in Florida but sold a property in the state of Ohio. I'm trying to allocate just the gains from the sale of the property to the Ohio return, but TT is transferring all of my income, i.e., interest, dividends, retirement, to the Ohio return and I don't see where any of it is being backed out. How do I allocate just what I should be paying Ohio taxes on?

Re: allocating income to Ohio tax return

DianeW777 — Wed, 21 Feb 2024 15:20:56 GMT

You are doing it right. Ohio (OH) is one of those states that takes all of the income into account, then arrives at the tax liability. Once this is calculated then the tax is prorated based on a percentage of only the OH portion of the income. Check out the actual tax liability and you will see your allocation is being taken into account.

Re: allocating income to Ohio tax return

llabah — Wed, 21 Feb 2024 15:35:18 GMT

Are you saying there's a form in the Ohio return where it shows that money being backed out? I'm confused, I guess, on how it knows what income came from Ohio versus Florida.

Re: allocating income to Ohio tax return

JohnW152 — Thu, 22 Feb 2024 16:55:11 GMT

No, income isn't being "backed out," per se.

States compute nonresident income tax different ways. In Ohio, your tax is calculated based on your total income, and then you receive a credit against the tax, based on your non-Ohio income.

According to How do I calculate my nonresident credit? on the Ohio Department of Taxation's Income - Ohio Residency and Residency Credits page:

A nonresident taxpayer is allowed a “nonresident” credit for all income not earned or received in Ohio. The credit is calculated on the Ohio Schedule of Credits using the taxpayer’s non-Ohio portion of their Ohio adjusted gross income. Taxpayers must use form IT NRC to calculate the non-Ohio portion of their Ohio adjusted gross income.

See Form IT NRC and Ohio Schedule of Credits in the Instructions for IT 1040 and SSD 100 for more information.

@llabah