Changes in Ohio Use Tax laws will impact 300,000 Ohio businesses. Ohio Use Tax expert Justin Mohler, CPA addressed the Ohio Unse Tax Amnesty Program during his presentation. The recorded webinar is like at www.ohiousetax.com, where you can also receive a free use tax assessment.

1. Small Business Strategies To
Increase Your Cash Flow
How to Become Compliant
With Ohio’s Use Tax

2. Use Tax History
• Use tax law established in 1936
• Applies to storage, use or other consumption of
goods and services
• Use tax rate same as sales tax rate
www.ohiousetax.com

3. Ohio Use Tax Compliance
• 300,000 small to medium size businesses likely
owe Ohio use tax money
• 18,000 voluntarily comply with the use tax law
Source: Ohio Department of Taxation
www.ohiousetax.com

5. Use Tax Examples Exceptions
• Out of state purchases (e.g. vehicles, supplies, etc.)
• Not taxed or improperly taxed from in-state or
out-of-state purchase (e.g. repair/maintenance
services, different county rates, etc.)
• Over 100 exceptions to use tax law
www.ohiousetax.com

6. Why comply now?
• Ohio’s recent budget $8.0 billion deficit
• Use tax will be enforced on small and medium
size businesses (UTEP)
• The Ohio Department of Taxation compiled a list
of companies
• Businesses not in compliance will receive letters
beginning in August 2011
www.ohiousetax.com

7. Use Tax Barriers to Overcome
Companies unaware
Difficult to apply
of use tax
use tax law
Use Tax Education 96% of purchase
Program (UTEP)
audits show taxes due
www.ohiousetax.com

8. Do Nothing About Use Tax
• Will likely receive an assessment from Ohio
Department of Taxation
• Collection efforts will be outsourced to non-tax firms
through the Ohio Attorney General’s Office
• Records needed – invoices, receipts,
cancelled checks, etc.
• Will be subject to penalties and interest
• Shareholders, officers, key employees, have personal
liability for the use tax
www.ohiousetax.com

9. Should I Do Nothing?
Research purchase
history
Determine potential
exposure
Establish
procedures
immediately
www.ohiousetax.com

10. Proactive Approach - Use Tax Amnesty
• Program dates: October 1st 2011 – May 1st 2013
• Potential benefits
- Limit look back period to January 1, 2009
- Abatement of penalties
- Abatement of interest
- Payment Plan Option
www.ohiousetax.com

11. Taxpayers Previously Registered
• Consumers registered as of June 1, 2011
- No tax, penalty or interest will be assessed for
periods prior to January 1, 2009
- Participant is responsible for interest and penalty
on the delinquent use tax
- No criminal prosecution for those who
participate
www.ohiousetax.com

12. Taxpayers NOT Previously Registered
• Consumers NOT registered as of June 1, 2011
- No tax, penalty or interest will be assessed for
periods prior to January 1, 2009
- Penalty and interest will be fully abated
- No criminal prosecution for those who
participate
• Consumers that do NOT participate in the Use Tax
Amnesty Program will be subject to audit by ODT
www.ohiousetax.com

13. Other Budget Bill Provisions
• Limitation on consumer use tax assessments (may
impact current audits)
• General Tax Amnesty
- May 1, 2012 to June 15, 2012
- Other taxes (sales, CAT, income, etc.)
- Abatement of penalty and ½ of the interest
www.ohiousetax.com

14. Recommendations
• Research all in-state and out-of-state transactions to
determine tax liability
• Work with a use tax expert to self-report findings
and minimize exposure
• Limit look back period to January 1, 2009
• Avoid all interest, penalties and make payments
• Determine if refunds are available to offset use tax
liability (four year refund period)
www.ohiousetax.com

15. Ohio Use Tax
Open Forum for Your Questions

16. Contact Information
Justin P. Mohler, CPA
Watson Associates, Inc.
3749 County Road 55
Bellefontaine, OH 43311
Office: 937.592.6926
Fax: 937.592.5195
Mobile: 614.361.8458
jmohler@watson-tax.com
www.watson-tax.com
www.ohiousetax.com
www.ohiousetax.com

17. Thank You for Attending!

18. Contact Information
Justin P. Mohler, CPA
Watson Associates, Inc.
3749 County Road 55
Bellefontaine, OH 43311
Office: 937.592.6926
Fax: 937.592.5195
Mobile: 614.361.8458
jmohler@watson-tax.com
www.watson-tax.com
www.ohiousetax.com
www.ohiousetax.com