What Is the Ohio Schedule B for Business Income?
Ohio Schedule B consolidates business, rental, and farm income from federal schedules, creating a single total to report on your IT 1040 state tax return.
The Ohio Schedule of Business Income is a supplemental form filed with the state’s individual income tax return, the IT 1040. It consolidates various types of business-related income and losses that a taxpayer reports on their federal return. This schedule translates figures from multiple federal forms into a single calculation for Ohio tax purposes. The Ohio Department of Taxation requires this schedule to simplify the reporting of business activities before they are carried over to the main state tax form.
Who Must File the Ohio Schedule of Business Income
Filing the Ohio Schedule of Business Income is required for any individual taxpayer who reports income or loss on specific federal tax forms related to business activities. You must file this schedule if you file a federal Schedule C, “Profit or Loss from Business,” as a sole proprietor, freelancer, or independent contractor. The requirement also extends to those who file a federal Schedule F, “Profit or Loss from Farming.”
The filing trigger includes income or loss from rental real estate, royalties, partnerships, S corporations, estates, and trusts, which are reported on federal Schedule E, “Supplemental Income and Loss.” Taxpayers with income from these sources must complete the Ohio Schedule of Business Income. If you report the sale or exchange of property used in a trade or business on federal Form 4797, “Sales of Business Property,” the resulting gain or loss also necessitates filing the Ohio schedule.
Information Required to Complete the Form
To complete the Ohio Schedule of Business Income, you must first gather your finalized federal tax documents. The schedule requires you to report figures directly from these forms. You will need the following information:
- Net profit or loss from a sole proprietorship, found on line 31 of federal Schedule C.
- Net farm profit or loss, located on line 34 of federal Schedule F.
- Net income or loss from rents, royalties, partnerships, S corporations, and trusts, as reported on federal Schedule E.
- Gain or loss from the sale of business property, as reported on federal Form 4797.
Completing the Form and Reporting the Total
The process of filling out the Ohio Schedule of Business Income is a matter of careful data transfer from your federal forms. You will enter each piece of business income or loss on its corresponding line on the Ohio schedule.
After entering all applicable figures, you will sum the amounts to calculate your total business income or loss. This final total represents your comprehensive business income for Ohio tax purposes.
The final step is to carry this total over to the designated line on the Ohio IT 1040. You must attach the completed schedule to your IT 1040 when you file your state tax return. Failure to include the schedule when it is required can result in the rejection of your return and potential penalties.