Navigating Ohio’s payroll landscape requires attention to specific state regulations. Here’s a breakdown of key aspects:
**Ohio Income Tax Withholding:**
The Ohio Department of Taxation oversees state income tax collection. Contact them at P.O. Box 2476, Columbus, OH 43266-0076, (614) 433-7887, (888) 405-4039, or www.state.oh.us/tax. Ohio mandates the use of form IT-4, “Employee’s Withholding Exemption Certificate,” instead of the federal W-4 for state income tax withholding.
**Cafeteria and 401(k) Plans:**
Unlike some states, Ohio treats cafeteria plans (Section 125) favorably, exempting them from both income tax and unemployment insurance calculations. 401(k) deferrals are not taxable for income taxes but *are* taxable for unemployment purposes.
**Supplemental Wages:**
Supplemental wages in Ohio are taxed at a flat rate of 3.5%.
**W-2 Filing:**
Ohio allows employers to file W-2s via magnetic media.
**Ohio Unemployment Insurance:**
The Ohio Department of Job and Family Services, Unemployment Compensation Division (52 Robinwood Ave., Columbus, OH 43213, (614) 466-2100, www.state.oh.us/odjfs) administers unemployment insurance. The taxable wage base is $9,000.00. Quarterly wage reporting via magnetic media is optional. Unemployment records, including employee data, hire/rehire/termination dates, and wages, must be retained for five years.
**Wage and Hour Laws:**
The Department of Commerce, Division of Labor and Worker Safety, Wage and Hour Bureau (50 West Broad St., Columbus, OH 43215, (614) 644-2239, www.state.oh.us/Business/Employer/ProtectingYourBusiness/Wages.htm) enforces wage and hour laws. Minimum wage varies by employer size. Overtime is paid at one and a half times the regular rate for non-FLSA covered employers after a 40-hour week.
**New Hire Reporting:**
Ohio requires employers to report new hires and rehires within 20 days, including employee name, address, date of birth, hire date, Social Security number, employer name, address, and Federal EIN. Reports can be submitted via W-4 or equivalent by mail, fax, or electronically. Late reports incur a $25 penalty, while conspiracy carries a $500 penalty. Contact the Ohio new hire-reporting agency at 888-872-1490, 614-221-5330, or www.oh-newhire.com.
**Direct Deposit and Pay Stubs:**
Ohio permits compulsory direct deposit if the employee’s financial institution complies with federal Regulation E. There are no state provisions for pay stub information. Employees must be paid at least semi-monthly, or monthly if customary and paid by the first of the next month.
**Pay Period Lag and Final Wages:**
Ohio mandates specific lag times between the pay period and wage payment. There are no general provisions for when terminated employees must receive final wages. Deceased employees’ wages (up to $2,500) are payable to the surviving spouse, adult children, or parent. Unclaimed wages escheat to the state after one year, with employers required to maintain records for five years.
**Tip Credit and Meal Breaks:**
The maximum tip credit is $3.02 (less for small/medium employers). Mandatory rest breaks apply only to minors under 16 (30 minutes after five hours of work).
**Record Retention:**
Wage and hour records must be kept for at least three years, including FLSA-required information.
**Child Support Orders:**
The Office of Child Support, Ohio Department of Human Services (State Office Tower, 30 E. Broad St., 31st Fl., Columbus, OH 43266-0423, (614) 752-6561, www.ohio.gov/odhs/Ocs/index.htm) enforces child support. Withholding starts 14 working days after the order is mailed. Payments must be sent within 7 days of payday. Termination notices are due within 10 days of termination. The maximum administrative fee is the greater of $2 or 1% of the payment. Federal CCPA rules govern withholding limits.
*Disclaimer: This information is for general guidance only and may not reflect the most current changes in Ohio payroll law. Consult with legal and payroll professionals for specific advice.*