OHIO LEGISLATIVE SERVICE COMMISSION
Office of Research Legislative Budget
www.lsc.ohio.gov and Drafting Office
H.B. 324 Bill Analysis
135th General Assembly
Click here for H.B. 324’s Fiscal Note
Version: As Passed by the House
Primary Sponsors: Reps. McClain and Klopfenstein
Effective Date:
Zachary P. Bowerman, Attorney
SUMMARY
 Authorizes a nonrefundable income tax and commercial activity tax credit for the retail
sale of high-ethanol blend motor fuel.
 Limits the tax credit to no more than five years or to a total of $10 million, whichever
occurs first.
DETAILED ANALYSIS
High-ethanol blend motor fuel tax credit
The bill authorizes a temporary, nonrefundable tax credit of 5₵ per gallon for the retail
sale of high-ethanol blend motor fuel, which contains between 15% and 85% ethanol, that is
sold and dispensed through metered pumps at a retail dealer’s retail service station during the
calendar year. The credit may be claimed by retail dealers either against the dealer’s income tax
or commercial activity tax (CAT) liability.1
Application process
To obtain the credit, a retail dealer must first apply to the Director of Development for a
tax credit certificate. The application must be filed within the first 20 days of January after the
calendar year in which the credit-eligible sales are made. Upon approval, the Director issues the
retail dealer a tax credit certificate indicating the amount of the credit and must notify the
Department of Taxation of each certificate issued. The Director may not issue more than a total
of $10 million in tax credits over the term of the credit (see “Term of credit,” below).2
1 R.C. 5747.74, 5747.98, 5751.56, and 5751.98.
2 R.C. 122.078(A), (B), (C), and (D)(1).
February 23, 2024
Office of Research and Drafting LSC Legislative Budget Office
Carry forward
The credit is nonrefundable, which means that the credit may not exceed a taxpayer’s
tax liability in any year. However, if the credit does exceed a taxpayer’s liability for a particular
year, the taxpayer may carry forward and apply the difference to a future tax liability. There is
no limit on the number of carryforward years.3
Term of credit
The credit is available only for retail sales made in the taxable year or tax period that
includes the credit’s effective date or any of the four following calendar years. For example, if
the bill becomes effective in 2024, a retail dealer may apply for a credit for retail sales occurring
in years 2025, 2026, 2027, and 2028, as well as any taxable year or tax period that is still
pending or has yet to begin in 2024. If, however, the Director issues a total of $10 million in tax
credits before the end of that period, retail sales occurring in the remainder of that period after
that $10 million maximum allowable credit amount has been reached will not qualify for the
credit. A taxpayer must claim the credit for the taxpayer’s taxable year in which the credit-
eligible sales are made if taking the credit against the income tax or for the tax period in which
the tax credit certificate is issued if taken against the CAT, which is paid quarterly.4
HISTORY
Action Date
Introduced 11-08-23
Reported, H. Ways & Means 02-07-24
Passed House (88-6) 02-07-24
ANHB0324PH-135/ks
3 R.C. 5747.74 and 5751.56.
4 R.C. 122.078(D)(2).
P a g e |2 H.B. 324
As Passed by the House


Statutes affected:
As Introduced: 5747.98, 5751.98
As Reported By House Committee: 5747.98, 5751.98
As Passed By House: 5747.98, 5751.98