TBA Signs Resolution Opposing HB166
August 23, 2019 – Toledo, Ohio
At its August meeting, the Toledo Bar Association Board of
Directors approved a resolution to support the Ohio State Bar Association
(OSBA) in opposing a change to the state business income tax deduction. This change singles out Ohio lawyers and
government affairs professionals, taking away their ability to claim the state
Business Income Deduction (BID) starting in tax year 2020 while allowing all
other similarly-situated entities to continue the practice.
Since Tax Year 2013, Ohio law has treated all businesses
deriving income through pass through entities (LLCs, LLPs etc.) the same,
allowing them to deduct the first $250,000 of their income. The recent
amendment targeting the profession will result in a significant tax increase
for many lawyers and law firms across the state.
The BID amendment was inserted
at the last minute during a harried budget process, without public debate,
testimony or data to support the change. In addition to this flawed legislative process, problematic drafting
will lead to many unintended consequences. One of particular concern to the TBA is that it
excludes only lawyers who are licensed with the Supreme Court of Ohio, meaning
that lawyers registered in other states, but who pay taxes for work done in
Ohio, would still be able to claim the Ohio deduction though Ohio-based lawyers
would not, putting Ohio lawyers, especially in border communities, at a
The OSBA has begun a grassroots campaign to reverse this
policy and they are seeking the support from other bar associations, law firms
and individual lawyers.
To learn more
about this effort and how you can get involved, visit www.ohiobar.org/get-involved.