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Ohio State Taxes: What You’ll Pay in 2025

Posted on 12/19/24 by Michelle Cerulli McAdams

Ohio’s top income tax rate of 3.5 percent puts it in the bottom third of the 50 states, but its property and sales tax rates are on the higher end compared with the rest of the country. The Buckeye State is friendly to those 65 and older, with several tax breaks for seniors and no state tax on inheritances, estates or Social Security.

The big picture:

  • Income tax: 2.75 percent to 3.5 percent
    Ohio has two tax brackets: 2.75 percent and 3.5 percent. Residents of many Ohio cities and villages also pay local income tax on top of state tax. Ohio residents who earn $26,050 or less do not have to pay state income tax.
  • Property tax: 1.3 percent of a home’s assessed value (average)
    Real estate taxes are levied by localities and vary, with an average tax rate of 1.3 percent of a home’s assessed value in 2022, according to the Tax Foundation.
1140-state-tax-ohio[24].png
Getty/AARP

How is income taxed in Ohio?

The state’s two tax brackets can be found below. They are the same across filing statuses. Those who earn $26,050 or less do not have to pay state income tax. Most Ohio cities and villages have a municipal income tax as well, with rates ranging from 0.5 to 3 percent. 

Note that your income is not all taxed at the same rate.  

IncomeTax Rate
$26,051 – $100,000$360.69 plus 2.75% of the amount in excess of $26,050
More than $100,000 $2,394.32 plus 3.5% of the amount in excess of $100,000

Source: Ohio Department of Taxation

If you live in Ohio and earn income in another state, or vice versa, or if you move to another state during the tax year, you may be eligible for a residency credit. Find more information on the Ohio Department of Taxation website.

A joint filing credit of up to $650 is available on joint returns for taxpayers and their spouses who each have at least $500 of qualifying income. Check the Ohio Department of Taxation website for additional tax credits, including ones for displaced worker training, scholarship donations and adoptions.

Watch the video below to learn how to identify your 2024 federal income tax brackets.

Understanding Your 2024 Income Tax

Are pensions or retirement income taxed in Ohio?

In general, government pensions and retirement income are taxed in Ohio, but there are some exceptions. Social Security and some railroad retirement and military benefits are not taxed. Also, Ohio does not tax nonresidents’ retirement income.
 
Ohio offers two retirement income credits for those with a modified adjusted gross income (less exemptions) of less than $100,000: a retirement income credit of up to $200, and a one-time lump-sum retirement credit if you have received a total, lump-sum distribution and have not claimed this credit before. To calculate the latter credit, use this worksheet. You cannot claim both credits. Learn more about credit eligibility here.

AARP’s Retirement Calculator can help you determine if you are saving enough to retire when — and how — you want.

What about investment income?

Capital gains from investments, including the sale of property for personal use, are treated as individual income and taxed accordingly. 

Does Ohio tax Social Security benefits?

No, but you may pay federal taxes on a portion of your Social Security benefits, depending on your income. Up to 50 percent of your benefits will be taxed if you file an individual tax return and make between $25,000 and $34,000 in total income — or if you file jointly and as a couple make $32,000 to $44,000 in total income. Also, up to 85 percent of your benefits will be taxed by the federal government if your total income is more than $34,000 individually or $44,000 as a couple.

AARP’s Social Security Calculator can assist you in determining when to claim and how to maximize your Social Security benefits.

How is property taxed in Ohio? 

Property tax rates are based on home values and vary by location. The average property tax rate in Ohio was 1.3 percent in 2022, according to the Tax Foundation.

Learn how real estate taxes are assessed on the Ohio Department of Taxation website. Homeowners can initially contest their property valuation through their county’s board of revision. Subsequent appeals would go through the Ohio Board of Tax Appeals. Personal property such as cars, boats and jewelry are subject to sales and use tax but no additional personal property tax.

What about sales tax and other taxes?

  • Exemptions: Groceries (except soda), newspapers, medications, home medical equipment and many additional items and services are not taxed. View the full list of taxed and tax-exempt items and services.
  • Alcohol: Ohio levies an excise tax on alcohol in addition to sales tax. Beer is taxed at 18 cents per gallon and wine at 32 cents per gallon. Hard liquor (over 21 percent alcohol by volume) is taxed at $3.38 per gallon, according to the Ohio Department of Taxation. Alcohol taxes are paid by the vendor, but some or all may be included in the retail price.
  • Lottery winnings: Buckeye State residents’ lottery winnings must be included in Ohio gross income. Ohio Lottery Commission winnings by nonresidents are also taxed by the state. The state automatically withholds state and federal taxes on prizes more than $599.

Will I or my heirs have to pay inheritance and estate tax in Ohio?

No. Ohio phased out its estate tax in 2013 and does not have an inheritance tax.

Are there any tax breaks for older Ohio residents?

Ohio’s homestead exemption reduces the property tax burden of low-income senior citizens as well as permanently disabled Ohio residents. The exemption exists as a credit, in which up to $25,000 of one’s home market value is exempt from property taxes.

Ohio also offers two credits for those who are 65 and older and who have a modified adjusted gross income (less exemptions) of less than $100,000.

The senior citizen credit offers a $50 credit per tax return. Seniors who have received a total, lump-sum distribution may be eligible for a one-time lump-sum distribution credit. Use the worksheet in the Ohio income tax instructions booklet to calculate your credit.

You cannot claim both credits; however, claiming the lump sum distribution credit does not disqualify you from claiming the senior citizen credit on your school district income tax return. Learn more on the Ohio Schedule of Credits.

Are military benefits taxed in Ohio?

Ohio does not tax U.S. military pensions. The Buckeye State also does not tax military injury relief or veteran’s disability severance payments because they are not taxed federally. A service member’s civilian spouse may be eligible for deductions.

What is the deadline for filing Ohio taxes in 2025?

The deadline to file an Ohio state tax return is April 15, which is also the deadline for federal tax returns. For help estimating your annual income taxes, use AARP’s Tax Calculator.

The personal income tax extension filing deadline is Oct. 15, though taxes owed are still due by April 15. Ohio does not have its own extension form. It honors extensions filed with the IRS. Learn more about extensions.

Michelle Cerulli McAdams is a freelance writer based in Massachusetts. She has written for the AARP Bulletin for 10 years, covering health, medicine, politics and policy.

Writer Maura Kelly Lannan contributed to this story.

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