Navigating the complexities of state taxes can be daunting, but understanding Ohio's tax landscape is essential for residents and newcomers alike.
In this guide, we'll explore key components of The Buckeye State's tax system, from income and sales taxes to property taxes and retirement benefits.
Ohio state tax: Overview
Some workers in Ohio may see a bit more money in their paychecks this year, thanks to recent changes that lowered income taxes across the board.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
But it's not all low taxes in the Buckeye State. Property taxes tend to be higher than in many other states, and Ohio drivers face one of the highest gas taxes in the country. So while there’s some relief on the income tax front, other costs can still add up.
In the news: As retail giants across the U.S. warn of looming price hikes, families looking forward to the upcoming school year are bracing for impact.
Prices for back-to-school and college supplies have been on the rise, and made worse by the Trump administration’s sweeping tariffs on imported goods. To soften the blow of rising costs, Ohio Gov. Mike DeWine announced that the state sales-tax holiday will once again run for two full weeks.
For more information, see Ohio Announces Two-Week Sales Tax Holiday Amid Tariffs, High Prices.
[Data for this state tax guide was gathered from a number of sources including the Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.]
Ohio income tax
Ohio has a graduated state individual state income tax rate ranging from 2.75% to 3.5%, according to the Tax Foundation.
Note: Cities and school districts in Ohio can also impose local income taxes.
Ohio retirement taxes
Ohio taxes most types of retirement income, but military retirement pay is tax-exempt, and the state’s tax brackets are low when compared with other states. There is no estate or inheritance tax in Ohio.
Tax on Taxable Income: Low of 2.75% (on between $26,051 - $100,000) and a high of 3.5% (on more than $100,000)
(Note: Ohio tax brackets depend on residency and filing status.)
- Social Security: Not taxable
- Pensions: Taxable
- 401(k) and IRA Distributions: Taxable
Ohio sales tax
The state sales tax rate in Ohio is 5.75%.
Localities can add as much as 2.5%, and the average combined rate is 7.23%, according to the Tax Foundation.
- Groceries: Exempt
- Prescription drugs: Exempt
- Diapers: Exempt
- Menstrual products: Exempt
- Clothing: Taxable
How much are property taxes in Ohio?
In Ohio, the average effective property tax rate is 1.31%, which is higher than in most states.
Ohio Property Tax Breaks for Retirees
A homestead exemption is available for qualified homeowners, which allows up to $28,000 exemption of a home's market value from all local property taxes. Ohioans must have a household income that does not exceed $40,000 for 2025.
Homeowners must also meet one of the following criteria to qualify.
- Be 65 or older
- Have a permanent and total disability
- Be at least 59 years old and the surviving spouse of a deceased taxpayer who had previously received the exemption
Note: Taxpayers who were granted the exemption prior to 2014 will continue to receive it.
Ohio gas tax
Gasoline | $0.28 per gallon |
Diesel | $0.28 per gallon |
Source: Sales Tax Handbook
Ohio taxes on alcohol and tobacco
Product | Tax Amount |
|---|---|
Cigarettes | $1.60 per pack |
Other tobacco products | 17% of wholesale price |
Medical Marijuana | 5.75% |
Source: Sales Tax Handbook
Product | Tax Amount |
|---|---|
Beer | $0.18 per gallon |
Wine | $0.32 per gallon |
Liquor | State-Controlled |
Source: Sales Tax Handbook
Ohio estate and inheritance tax
Ohio doesn't have an estate or an inheritance tax.
Related
-
Don’t Let Your Dreams Go Unfulfilled: Plan for Your Passion in RetirementFollow these three steps to ensure you are emotionally and financially prepared for your passion in retirement.
-
I Heard Tariffs Will Cost Families $2,800 This Year. I'm a Retiree on a Fixed Income. How Can I Prepare?We ask retirement planning experts what to do.
-
The Most Tax-Friendly State for Retirement in 2025: Here It IsRetirement Tax How do you retire ‘tax-free’? This state doesn’t tax retirement income, has a low median property tax bill, and even offers savings on gas. Are you ready for a move?
-
Virginia Tax-Free Weekend 2025 Is Here August 1–3: What to KnowSales Tax Three days, no sales tax. Here’s what qualifies for Virginia’s tax-free weekend.
-
Virginia Sales Tax Holiday 2025
Sales Tax Three days, no sales tax. Here’s what qualifies for Virginia’s tax-free weekend.
-
Georgia Could Be Latest State to Eliminate Income TaxesState Tax Eliminating the Georgia state income tax: Last-minute summer trend or permanent policy?
-
Biggest Winners and Losers in Trump's New Tax PlanTax Law Trump’s mega tax overhaul, known as the ‘One Big Beautiful Bill,’ has distinct winners and losers. Which group do you fall into?
-
Trump Calls for Cane Sugar Coke: Will You Pay Higher Prices and Soda Tax?Food Taxes The debate over cane sugar vs. corn syrup is heating up, raising questions about cost, policy, and, in some cases, soda taxes.
-
Back‑to‑School Tax‑Free Deals Hit Walmart & Apple This Summer: States, Dates and LimitsSales Tax Select states host sales tax holidays during the summer. Here’s what you can purchase.
-
Five Ways Trump’s 2025 Tax Bill Could Boost Your Tax Refund (or Shrink It)Tax Refunds The tax code is changing again, and if you’re filing for 2025, Trump’s ‘big beautiful’ bill could mean a bigger refund, a smaller one or something in between next year. Here are five ways the new law could impact your bottom line.
