Ohio Marriage Penalty (Updated for Tax Year 2014)

It is a little known fact that Ohio’s married taxpayers are frequently better off Filing Separate returns instead of Joint when both spouses are employed.

This is due to Ohio’s progressive income tax. The more you make, the greater percentage they take. The marriage penalty begins when Joint Taxable Income reaches $10,001. A married couple each working full time and earning minimum wage will pay an Ohio Marriage Penalty of $166 for tax year 2014.

Some simple examples of your Ohio IT 1040 are as follows (assumes equal income, no dependents, and no Schedule B – Line 7 credits):

Ohio IT 1040 Line 5 Joint Taxable Income Ohio Marriage Penalty
$10,001 $17
20,000 97
30,000 208
40,000 219
60,000 259
100,000 476
200,000 1,235

Note: The Joint Filing Credit is factored into all calculations.

An on-line calculator for entering Incomes, Schedule B – Line 7 credits, and Dependent exemptions is available.
Note: The calculator is designed to be used with Microsoft Excel. It may not work on computers without a spreadsheet program. The calculator can be downloaded as an Excel file by using File|Save As on your browser.

The only way to avoid the Ohio Marriage Penalty is to File Separately or be homosexual.

Except for homosexuals, Ohio law requires that the Federal return’s Filing Status match Ohio’s.

Without regard to ORC 5747.08 (E), the Ohio Department of Taxation (ODT) has created Form IT S to allow homosexuals to file joint federal and separate Ohio returns thus avoiding the Ohio Marriage Penalty. Does this sound like an Equal Protection Clause violation? Regardless, the tax code has always encouraged cohabitation. Beginning in 2013, the ODT began subsidizing homosexual marriage but not heterosexual marriage.

For me to avoid the Ohio Marriage Penalty, I have to either divorce my wife and cohabitate with her, or divorce my wife and marry another man.

Filing Separate on the Federal return requires that you not fund any type of IRA (unless your total income, less a few adjustments, is less than $10,000) and sacrifice a number of different credits and deductions.

Ohio has created a lose-lose situation for working families.

The fix is simple: Ohio should allow ALL of us to choose a filing status different from the Federal return’s.

Tell your legislator that you are pro-choice on Filing Status.

Neighboring states including Kentucky, Pennsylvania, and West Virginia allows this; why not Ohio?