What Percent of Taxes Are Taken Out of a Paycheck in Ohio?

Understanding the taxes withheld from your paycheck is an important part of managing personal finances. These deductions represent obligations to federal, state, and local governments, directly impacting your take-home pay. While calculating the exact percentage can seem complex, grasping the components provides clarity. Knowing where your money goes helps with budgeting and financial planning.

Federal Payroll Taxes

Federal payroll taxes include contributions to Social Security and Medicare, known as Federal Insurance Contributions Act (FICA) taxes, along with federal income tax. Social Security is taxed at 6.2% for both employees and employers. This tax applies to wages up to an annual limit, which is $176,100 for 2025, meaning earnings above this amount are not subject to Social Security tax.

Medicare is taxed at 1.45% for both employees and employers, with no wage limit. An Additional Medicare Tax of 0.9% applies to wages exceeding $200,000 for individuals, though employers do not match this additional tax. Federal income tax withholding is based on a progressive tax system, where higher earners pay a larger percentage of their income in taxes. The amount withheld depends on the employee’s choices on their Form W-4, which provides information on filing status, dependents, and other income adjustments.

Ohio State Income Tax

Ohio operates a progressive state income tax system with varying tax brackets. For the 2024 tax year, filed in 2025, rates range from 0% to 3.5%. The lowest bracket applies to income up to $26,050, which is exempt from state income tax. Income between $26,051 and $100,000 is taxed at a different rate, and income above $100,000 is subject to the highest rate.

The specific income thresholds for these brackets are subject to annual adjustments due to inflation. Ohio residents may qualify for certain deductions and credits that can reduce their taxable income and their state tax liability. For example, retirement income and those aged 65 and older may be eligible for specific credits, and Social Security benefits are not taxed by the state.

Ohio Local Income Taxes

Ohio has a unique tax landscape, featuring both municipal (city) income taxes and school district income taxes, which are separate from state tax. Municipal income taxes are levied by cities and villages, based on where an individual works, lives, or both. Rates for municipal taxes vary by city, ranging from 0.50% to 3%.

Many cities offer a credit for taxes paid to a work city if the individual lives in a different city that also has a local income tax. School district income taxes are distinct and are based solely on an individual’s residence within a specific school district, not where they work. These taxes are approved by local voters to fund education, and their rates vary among the school districts that impose them, ranging from 0.5% to 2%. Individuals can find their specific municipal and school district tax rates through their employer, local government websites, or the Ohio Department of Taxation’s online search tools.

Factors Affecting Your Withholding

Several individual choices and circumstances directly influence the actual percentage of taxes withheld from a paycheck. The Form W-4 is a document employees complete to inform their employer how much federal income tax to withhold. Information provided on the W-4, such as filing status (e.g., single, married filing jointly, head of household), the number of dependents, any additional withholding amounts, and adjustments for other income, directly impacts the calculation of federal and state income tax withholding. Updating the W-4 form after significant life changes like marriage, divorce, or having a child can help ensure accurate withholding.

Pre-tax deductions also reduce taxable income, lowering the amount of income tax withheld. Contributions to certain employer-sponsored benefits, such as 401(k) retirement plans, health insurance premiums, Flexible Spending Accounts (FSAs), and Health Savings Accounts (HSAs), are taken out of gross pay before taxes are calculated. This means that a lower amount of income is subject to federal, state, and sometimes local income taxes, as well as Social Security and Medicare taxes, which can result in a higher net pay.

Understanding Your Paycheck Statement

Interpreting a paycheck stub helps identify and understand the various deductions. A pay stub summarizes your total earnings and how they are distributed, broken into sections for earnings, taxes, and other deductions. You will find “gross pay,” your total earnings before deductions, and “net pay,” the amount you receive after all withholdings.

Specific line items on your pay stub will detail the various tax withholdings. Look for labels such as “Federal Income Tax” (FIT), “Social Security,” and “Medicare” for federal deductions. For Ohio-specific taxes, you will see “Ohio State Income Tax” (OH SIT), “Municipal Tax” or “City Tax,” and “School District Tax” (SDIT). Regularly reviewing your pay stub helps ensure the accuracy of these deductions and provides clarity on your financial inflows and outflows.