What Are Ohio’s 1099 Filing Requirements?
Understand Ohio's distinct 1099 filing rules. This guide clarifies when a state filing is necessary and details the required transmittal form and procedures.
Businesses issue IRS Form 1099 to report payments like non-employee compensation, rent, and dividends to individuals and entities who are not employees. While this is a federal requirement, each state has its own rules for filing these forms with its tax agency. The following guide covers the specific requirements for filing 1099s with the state of Ohio.
Determining Your Ohio Filing Obligation
A federal requirement to issue a Form 1099 does not automatically create a filing duty with the state of Ohio. The primary factor determining your state-level obligation is whether you withheld Ohio income tax from the payments you made. If no state income tax was withheld, you do not need to file copies of Forms 1099-NEC, 1099-MISC, or 1099-R with the Ohio Department of Taxation.
Payers who have withheld Ohio income tax from non-employee compensation, pension distributions, or other miscellaneous payments are mandated to report this information to the state. This ensures the Department of Taxation can reconcile the tax withheld by the payer with the income reported by the recipient on their state income tax return.
Ohio participates in the Combined Federal/State Filing (CF/SF) Program, which allows the IRS to forward certain 1099 information to the state. However, this program cannot be used for forms that have Ohio tax withholding. In cases where Ohio tax was withheld, payers must file forms like the 1099-R, 1099-MISC, and 1099-NEC directly with the state.
Required Information and State Forms
Before filing, you must gather specific information for your business and for each recipient. This includes the payer’s legal name, address, and federal and state tax identification numbers. For each recipient, you need their full name, address, and Taxpayer Identification Number (TIN). You must also have the total payment amount and the exact amount of Ohio income tax withheld.
Ohio requires a transmittal form, Form IT 3, to summarize the 1099 data being filed. Payers do not need to complete this form manually. When filing electronically through the state’s portal, the system automatically generates Form IT 3 based on the uploaded 1099 information to reconcile the total tax withheld.
How to File with the State of Ohio
The deadline for filing forms that report Ohio tax withholding, such as the 1099-NEC, 1099-MISC, and 1099-R, is January 31 of the year following the payment year. If this date falls on a weekend or holiday, the deadline shifts to the next business day. This aligns with the federal deadline for furnishing copies to recipients.
The Ohio Department of Taxation requires all payers to file 1099s electronically, regardless of the number of returns being filed, as paper filing is not an option. Filings must be submitted through the state’s OH|TAX eServices portal, which has replaced the Ohio Business Gateway (OBG). Within the portal, payers use the W-2/1099 upload feature to submit a file containing the required information.
Penalties for Non-Compliance
The state imposes penalties for both filing late and for failing to pay any withheld tax by the due date. If you file your returns after the deadline, the penalty is calculated as the greater of $50 per month, up to a $500 maximum, or 5% of the tax due per month, up to a 50% maximum.
A separate penalty applies for the late payment of withheld taxes, which amounts to 50% of the total tax due. It is possible for both the late filing and late payment penalties to be applied concurrently.
In addition to these penalties, interest will be charged on any withheld tax that is paid late. The interest accrues on the underpayment from the original due date until the date the tax is paid in full.