The Ohio Capital Gains Tax Repeal Act seeks to amend sections 718.01 and 5747.01 of the Revised Code and repeals section 5747.79, with the primary goal of exempting capital gains from state and municipal income taxation. The bill introduces new legal language that clarifies that net capital gains not classified as exempt income will be excluded from taxable income calculations for both residents and non-residents of municipal corporations. Additionally, it aligns municipal taxable income definitions with federal income tax definitions, aiming to simplify the tax code and potentially benefit individuals and businesses involved in investment activities.

The legislation also includes several amendments related to the treatment of net operating losses and various deductions for taxpayers. It defines "net profit" for non-individual entities and allows for the deduction of net operating losses to reduce municipal taxable income, with specific limitations on the amount that can be deducted for certain taxable years. The bill further clarifies the tax treatment of disregarded entities and publicly traded partnerships, introduces new definitions for terms relevant to tax administration, and expands the list of allowable deductions. Overall, the act aims to streamline tax processes, enhance clarity for taxpayers, and eliminate the capital gains tax in Ohio.

Statutes affected:
As Introduced: 718.01, 5747.01, 5747.79