Beginning on January 1, 2024, the Ohio Commercial Activity Tax (CAT) will undergo major changes. For tax periods beginning on and after January 1, 2024, the CAT annual minimum tax is eliminated, and the gross receipts exclusion amount is increased from $1 million to $3 million. Therefore, taxpayers with taxable gross receipts of $3 million or less per calendar year will no longer be subject to the CAT. Both annual and quarterly taxpayers who anticipate having less than $3 million in taxable gross receipts in tax year 2024 may cancel their CAT account immediately, with an effective date of December 31, 2023.

CAT changes effective January 1, 2024

• The annual minimum tax is eliminated for tax periods 2024 and thereafter.
• The annual gross receipts exclusion amount is increased to $3 million.
• Taxpayers with taxable gross receipts of $3 million or less per calendar year will no longer be subject to the CAT.
• The 2023 annual return due May 10, 2024, is the final return required for annual filers no longer subject to CAT in 2024.
• Taxable gross receipts exceeding $3 million will be taxed at 0.26%.

Visit Ohio’s Department of Taxation for more information, or contact us to discuss how this change may impact your business.