Tax and Finance Management

Study: Ohio Offers Sixth-Best ROI for Taxpayers

Some states offer better returns on taxpayer investments than others. According to a new ranking by WalletHub.com, Ohio is the sixth-best state for taxpayer ROI. The personal finance website used 30 metrics to compare the quality and efficiency of state government services across the areas of education, health, safety, economy, infrastructure, and pollution. 3/24/2021

Onshoring Incentives Could Have Bipartisan Support

While there isn’t much bipartisanship on Capitol Hill nowadays, new tax incentives for domestic manufacturing activity could provide for some common ground.

“There is likely to be legislation here that provides incentives for onshoring,” U.S. Sen. Chris Coons (D-Del.) told Law360.com, adding that there’s “bipartisan support for incentives” to spur U.S. production of PPE, drugs and vaccines, as well as semiconductors and other parts required for automobiles, 5G wireless networks, and other key products. Ohio’s U.S. Sen. Rob Portman has been part of the onshoring discussions, according to the article. 3/23/2021

A Look at the Extended Employee Retention Credit

The American Rescue Plan (ARP) gave some clarity and additional relief to businesses seeking to utilize the employee retention credit (ERC). In this summary, OMA Connections Partner CliftonLarsonAllen explains that the credit has been extended through the end of 2021, allowing up to $7,000 per employee per quarter for eligible employers — for a maximum credit of $28,000 per employee this year. The ARP clarifies what wages are excluded from the ERC. 3/24/2021

At a Glance: Depreciation Recapture

OMA Connections Partner CliftonLarsonAllen has published this insight to analyze the complexities of depreciation recapture rules, created to prevent offsetting depreciation deductions with ordinary income. Depreciation recapture can impact factories, office buildings, warehouses, and “structural components.” 3/25/2021

How Auditors Assess Cyber Risks

If your business’ financial statements are audited, expect your audit team to tailor its procedures to answer critical questions about cyber risks and the effectiveness of your internal controls. For more on how data security plays a critical part of the audit risk assessment, read this insight from OMA Connections Partner GBQ Partners. 3/24/2021

Ohio’s Temporary Law for Muni Income Tax Faces Another Legal Challenge

The debate continues at the Statehouse and in the courts over Ohio’s temporary law that allows municipal income tax withholdings to be based on an employee’s principal work location — not where he/she is working remotely during COVID-19. As another legal challenge is filed, the House Ways and Means Committee proceeds with hearings on House Bill 157 — a bill to expedite the repeal of the temporary law.

The OMA continues to voice its concerns over an immediate repeal of this temporary provision. “Companies are concerned that their payroll staff and systems will not be able to handle required withholding and income tax changes without ample lead time, and they are concerned about making substantial changes in the middle of any tax year,” the OMA’s Rachael Carl told lawmakers this week.

Meanwhile, several Ohio newspapers have reported on the high stakes for cities should HB 157 become law. Ohio’s six biggest cities (Cleveland, Columbus, Cincinnati, Akron, Toledo, and Dayton) get about 88% of their revenue from income taxes, according to The Columbus Dispatch (subscription). 3/18/2021

NAM’s Timmons: Manufacturers Need Stable, Predictable Federal Tax Code

This week, the U.S. Senate Finance Committee held a hearing on how federal taxes impact manufacturing. National Association of Manufacturers President and CEO Jay Timmons told senators that policymakers “must recognize the importance of predictability and stability in the tax code” — and that recent tax reforms have made manufacturers more competitive, driving historic job creation.

Timmons added that manufacturers in America need a tax code that supports innovation, but “unfortunately, it will do just the opposite starting next year” due to a looming change to the tax treatment of R&D costs. Read his full comments. 3/17/2021

Cost Accounting: Don’t Let It Sit on the Back Burner

Accurately measuring your business costs is vital, yet some companies consider cost accounting too difficult, expensive, or resource intensive. This insight from OMA Connections Partner Clark Schaefer Hackett explains how cost accounting helps finance teams collect the data they need to make better decisions, and why it should be prioritized. 3/18/2021

IRS Extends Federal Individual Tax Filing Deadline

The IRS has officially announced that it will extend the individual tax filing season by one month until May 17, 2021. OMA Connections Partner Schneider Downs has published new insight on this development. 3/18/2021

Ohio’s February Revenues Exceed Estimates by 10.6%

Ohio’s tax revenue continues to beat forecasts. According to the February financial report, released this week by the Office of Management and Budget, the state’s total tax receipts of $1.9 billion last month exceeded estimates by $182.9 million (10.6%). For the first eight months of the fiscal year, Ohio’s tax receipts have exceeded estimates by $722 million (4.5%).

During February, the tax revenue source with the largest year-over-year increase was personal income tax at $203.9 million (114.1%) above last year. The next-largest increases were financial institutions tax at $25.5 million (50.3%), commercial activity tax at $22.5 million (6.4%), and auto sales tax at $18.2 million (17.7%). 3/8/2021