Ohio Commercial Activity Tax Modifications in 2024

Beginning January 1, 2024, noteworthy changes in the Commercial Activity Tax (CAT) landscape will reshape the tax responsibilities of Ohio CAT taxpayers. 

Here’s what you need to know:

• The CAT annual minimum tax is eliminated.
• The exclusion amount is increased from $1 million to $3 million.
• Annual filing is eliminated after the 2023 annual return.
• Taxpayers with taxable gross receipts of $3 million or less per calendar year will no longer be subject to the CAT in 2024.

Assess Your Annual CAT Receipts

The Ohio Department of Taxation strongly urges taxpayers to evaluate their annual CAT receipts. Those anticipating taxable receipts below $3 million in 2024 are encouraged to cancel their CAT account immediately, with an effective date of December 31, 2023 (which you can backdate).

Please note, you must still file your last quarterly return for tax year 2023 which is due February 12, 2024. 

Additionally, all registered CAT taxpayers with active accounts are required to file returns, even if they do not meet the taxable gross receipts threshold.  Therefore, if you do not cancel your CAT account, you will need to continue filing CAT returns each quarter.

How to Cancel Your CAT Account

To cancel your CAT account, please visit the Ohio Business Gateway at gateway.ohio.gov and follow the instructions below.

1. Once logged in, select ‘CAT Cancel Account’
2. Select your reason for cancellation from the drop-down menu to the right (your likely response will be ‘Taxable Gross Receipts Less Than Threshold’)
3. Enter an effective date (MM/DD/YYYY) or select a date from the calendar icon, then click ‘Next’
   1. *If you are canceling because of the CAT law changes, choose 12/31/2023 as the effective cancellation date
4. Review your information and submit

Once completed, a PDF confirmation will be available and maintained in the taxpayer’s history. It is crucial to formally cancel the account, as failing to do so may result in the receipt of delinquency notices and the potential need to invest substantial time in resolving the matter.

For assistance, contact Clark Schaefer Hackett or the Ohio Department of Taxation Business Tax Division at (888) 722-8829.