The bill amends section 5747.01 of the Revised Code to introduce a state income tax deduction for overtime wages, allowing workers to deduct these earnings from their taxable income for the first taxable year ending after the effective date and for the following seven years. This deduction applies only to overtime wages that have not been deducted or excluded in computing federal or Ohio adjusted gross income. The bill also clarifies existing definitions related to adjusted gross income and emphasizes that terms not defined within the section will carry the same meanings as those used in federal income tax laws, thereby enhancing consistency in tax regulations.

Additionally, the bill addresses the treatment of irrevocable inter vivos trusts and qualifying transfers, defining qualifying transfers and outlining scenarios under which they can be considered qualifying. It introduces new definitions related to taxable income for estates and trusts, including "modified business income" and "qualifying trust amount," while detailing how to calculate Ohio taxable income for trusts. The bill also clarifies the treatment of pass-through entities and trusts, establishing ownership criteria based on equity percentages and introducing definitions for qualifying investees and controlled groups. Notably, it repeals the existing section 5747.01 and presents the amended version as a composite of previous amendments, ensuring the changes apply to taxable years ending on or after the effective date.

Statutes affected:
As Introduced: 5747.01