Establish family and medical leave insurance benefits

As Introduced

136th
General Assembly

Regular
Session
S. B. No. 396

2025-2026

Senators Blessing, Liston

To
amend section 5747.01 and to enact sections 4143.01, 4143.02,
4143.03, 4143.04, 4143.05, 4143.06, 4143.07, 4143.08, 4143.09,
4143.10, 4143.11, 4143.12, 4143.13, 4143.14, 4143.15, 4143.16,
4143.17, and 4143.18 of the Revised Code
to
establish family and medical leave insurance benefits.

BE
IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section
1.
That
section 5747.01 be amended and sections 4143.01, 4143.02, 4143.03,
4143.04, 4143.05, 4143.06, 4143.07, 4143.08, 4143.09, 4143.10,
4143.11, 4143.12, 4143.13, 4143.14, 4143.15, 4143.16, 4143.17, and
4143.18 of the Revised Code be enacted to read as follows:

Sec.
4143.01.
As
used in this chapter:

(A)
"Armed forces" means the armed forces of the United States,
including the army, navy, air force, marine corps, space force, coast
guard, or any reserve components of those forces.

(B)
"Application year" with respect to any individual, means
the twelve-month period that begins on the Sunday of the calendar
week in which the individual files an application for family and
medical leave insurance benefits.

(C)
"Average weekly wage" means the sum of an employee's wages
for all qualifying weeks during the calendar quarter with the highest
wages in the employee's base period, divided by thirteen.

(D)(1)
"Base period" means the first four of the last five
completed calendar quarters immediately preceding the first day of an
individual's application year, except as provided in division (D)(2)
of this section.

(2)
If an individual does not have sufficient qualifying weeks and wages
in the base period to be eligible for family and medical leave
insurance benefits, the individual's base period shall be the four
most recently completed calendar quarters preceding the first day of
the individual's application year. Such base period shall be known as
the "alternate base period." No calendar quarter in a base
period or alternate base period shall be used to establish a
subsequent benefit year.

(3)
For purposes of determining the weeks that comprise a completed
calendar quarter under this division, only those weeks ending at
midnight Saturday within the calendar quarter shall be utilized.

(E)
"Child" means any of the following:

(1)
A biological, adopted, or foster child, a stepchild, or a legal ward
of an employee;

(2)
A child of an employee's domestic partner;

(3)
A minor child to whom an employee stands in loco parentis;

(4)
An individual to whom the employee stood in loco parentis when the
individual was a minor child.

(F)
"Covered active duty" means both of the following:

(1)
For a regular member of the armed forces, duty during deployment to a
foreign country;

(2)
For a member of a reserve component of the armed forces, duty during
deployment to a foreign country under a call or order to active duty
in support of a contingency operation during a war or national
emergency declared by the president of the United States or congress
of the United States.

(G)
"Domestic partner" means an individual, regardless of sex,
who is in a committed personal relationship, including a marriage,
civil union, or other committed relationship that is granted legal
recognition, with one other individual to whom the first individual
can demonstrate financial interdependence and that both individuals
share responsibility for a significant measure of the other
individual's welfare.

(H)
"Eligible individual" means an individual who satisfies the
requirements of section 4143.03 of the Revised Code to receive family
and medical leave insurance benefits.

(I)
"Employee" means any person who performs a service for
wages or other remuneration for an employer. "Employee"
does not include a person performing services in or about the
property of an employer on a casual basis or for a family business if
the person is a family member of an owner of the business.

(J)
"Employer" means any person who has one or more employees,
and includes an agent of an employer, the state or any agency or
instrumentality of the state, and any municipal corporation, county,
township, school district, or other political subdivision or any
agency or instrumentality thereof.

(K)
"Family and medical leave insurance benefits" means money
payments payable to an individual who has established benefit rights
under this chapter.

(L)
"Family member" means any of the following:

(1)
A child;

(2)
A parent;

(3)
A domestic partner;

(4)
A biological, foster, or adoptive grandparent or a step-grandparent
of the employee or the employee's domestic partner;

(5)
A biological, foster, or adoptive grandchild or a step-grandchild of
the employee or the employee's domestic partner;

(6)
A biological, foster, or adoptive sibling or a stepsibling of the
employee or the employee's domestic partner;

(7)
Any other individual, regardless of blood or legal relationship, with
whom the employee has a significant personal bond that is or is like
a family relationship.

(M)
"Family and Medical Leave Act" means the "Family and
Medical Leave Act of 1993," 29 U.S.C. 2601, et seq.

(N)
"Health care professional" means any of the following:

(1)
A dentist or dental hygienist licensed under Chapter 4715. of the
Revised Code or in another state;

(2)
A registered nurse, clinical nurse specialist, certified
nurse-midwife, or licensed practical nurse licensed or certified
under Chapter 4723. of the Revised Code or in another state;

(3)
An individual licensed under Chapter 4729. of the Revised Code or in
another state to practice as a pharmacist;

(4)
An individual authorized under Chapter 4730. of the Revised Code or
in another state to practice as a physician assistant;

(5)
An individual authorized under Chapter 4731. of the Revised Code or
in another state to practice medicine and surgery, osteopathic
medicine and surgery, or podiatry;

(6)
A psychologist licensed under Chapter 4732. of the Revised Code or in
another state;

(7)
A speech-language pathologist or audiologist licensed under Chapter
4753. of the Revised Code or in another state;

(8)
An occupational therapist, physical therapist, physical therapist
assistant, or athletic trainer licensed under Chapter 4755. of the
Revised Code or in another state;

(9)
A professional clinical counselor, professional counselor,
independent social worker, or social worker licensed under Chapter
4757. of the Revised Code or in another state;

(10)
A dietitian licensed under Chapter 4759. of the Revised Code or in
another state.

(O)
"Internal Revenue Code" has the same meaning as in section
5747.01 of the Revised Code.

(P)
"Military member" means an individual's family member who
is on covered active duty or has been notified of an impending call
or order to covered active duty and for whom the individual may take
leave to address a qualifying exigency.

(Q)
"Parent" means both of the following:

(1)
A biological, foster, or adoptive parent, a stepparent, or a legal
guardian of an employee or the employee's domestic partner;

(2)
A person who stood in loco parentis to an employee or the employee's
domestic partner when the employee or domestic partner was a minor
child.

(R)
"Qualifying exigency" means a financial, legal, logistical,
or other issue that arises when a military member is on covered
active duty or has been notified of an impending call or order to
covered active duty.

(S)
"Qualifying week" means any calendar week in an
individual's base period with respect to which the individual earns
or is paid wages. A calendar week with respect to which an individual
earns wages but for which payment was not made within the base
period, when necessary to qualify for family and medical leave
insurance benefits, may be considered to be a qualifying week. The
number of qualifying weeks that may be established in a calendar
quarter shall not exceed the number of calendar weeks in the quarter.

(T)
"Serious health condition" means an illness, injury,
impairment, or physical or mental condition that involves inpatient
care in a hospital, hospice, or residential health care facility, or
continuing treatment or continuing supervision by a health care
professional.

(U)
"Statewide average weekly wage" means the amount calculated
by the director of job and family services in accordance with
division (B) of section 4141.30 of the Revised Code.

(V)
"Wages" means all remuneration payable to an employee for
personal services performed for an employer, including commissions
and bonuses, and the reasonable cash value of all remuneration
payable to an employee in any medium other than cash.

(W)
"Weekly benefit amount" means the amount provided in
section 4143.06 of the Revised Code.

(X)
"Yearly earnings" means the total wages an individual earns
for the calendar year.

Sec.
4143.02.
(A)
The family and medical leave insurance program is created. The
director of job and family services shall administer and enforce the
program in accordance with this chapter and shall adopt rules in
accordance with Chapter 119. of the Revised Code to establish all of
the following with respect to the program:

(1)
Procedures for an individual to follow to allow the individual to
file a claim for family and medical leave insurance benefits under
section 4143.03 of the Revised Code;

(2)
The form an individual shall use to apply for family and medical
leave insurance benefits in English, Spanish, and any other language
spoken by three per cent or more of the state's population;

(3)
The manner and schedule by which an employer shall remit premiums to
the director as prescribed by section 4143.14 of the Revised Code;

(4)
Procedures for an individual to request a modification of an approved
claim for family and medical leave insurance benefits;

(5)
Procedures for an individual to follow to submit a weekly claim to
demonstrate the individual's eligibility to continue receiving family
and medical leave insurance benefits;

(6)
Requirements for the coordination of an eligible individual's family
and medical leave insurance benefits with any benefits the individual
receives under section 4123.56 or 4123.58 of the Revised Code for the
purpose of calculating the individual's weekly benefit amount under
section 4143.06 of the Revised Code;

(7)
Procedures for an employer to follow to receive a reimbursement of an
advance payment made to an employee of family and medical leave
insurance benefits under section 4143.07 of the Revised Code;

(8)
The time periods during which an independent contractor, sole
proprietor, partner, or joint venturer who has elected coverage under
section 4143.10 of the Revised Code may withdraw from coverage;

(9)
Requirements for an employer to provide or post the program notice
for employees that are in addition to the requirements specified in
section 4143.18 of the Revised Code.

(B)
The director may adopt additional rules the director considers
necessary to administer and enforce the program and this chapter.

Sec.
4143.03.
(A)
An individual may receive family and medical leave insurance benefits
for any of the following reasons:

(1)
The individual has a serious health condition that makes the
individual unable to perform the functions of one or more of the
individual's jobs.

(2)
The individual is caring for a new child during the first year after
the birth or adoption of the child or the placement of the child
through foster care, or is preparing for the adoption of the child or
placement of the child through foster care.

(3)
The individual is caring for a family member who has a serious health
condition.

(4)
The individual is addressing a qualifying exigency described in
section 4143.04 of the Revised Code.

(B)
To be eligible to receive benefits, an individual shall do all of the
following:

(1)
File a claim for benefits in accordance with rules adopted by the
director of job and family services under section 4143.02 of the
Revised Code;

(2)
Consent to the release of information that is considered confidential
under section 4143.16 of the Revised Code;

(3)
Demonstrate that the individual has been employed by and worked for
one or more employers and earned wages of at least two thousand five
hundred dollars during the individual's base period;

(4)
Demonstrate that the individual's employer withheld and remitted
premiums to the family and medical leave insurance program while the
individual was employed by the employer;

(5)
Attest in the claim for benefits that the individual notified the
individual's employer in writing of the individual's intent to take
leave for one of the reasons listed in division (A) of this section
as soon as practicable and the individual's proposed schedule for
taking leave;

(6)
If the individual is unemployed at the time the individual files a
claim for benefits, demonstrate that the individual has been
separated from employment for not more than twenty-six weeks at the
time the individual files the claim;

(7)
Provide a certification under section 4143.05 of the Revised Code as
applicable.

(C)
An employer shall not require the individual to provide more than
thirty days of notice under division (B)(5) of this section before
the individual's leave begins if the need for leave is foreseeable.

(D)(1)
An individual shall file a claim for benefits under this section not
more than sixty days before the date the individual anticipates
beginning the period of leave or within ninety days of the date the
individual's period of leave began. The director may waive the
ninety-day filing period for good cause.

(2)
The director shall notify an employer within five business days after
an individual files a claim for benefits under this section that the
claim has been filed.

(E)
An individual who meets the requirements of division (B) of this
section may receive family and medical leave insurance benefits
regardless of whether the individual is currently employed or is
working at a different job while taking leave.

(F)
No claim for benefits or an individual's eligibility to receive
benefits under this section shall be invalidated for any of the
following reasons:

(1)
A failure to file a claim for benefits;

(2)
A failure to furnish notice of the intent to take leave to an
employer;

(3)
A failure to submit an attestation or certification required by
division (B)(5) and (7) of this section;

(4)
The employer's failure to withhold and remit premiums as required
under section 4143.14 of the Revised Code.

(G)(1)
An individual whose claim for benefits is denied by the director may
appeal the decision to the director within ninety calendar days after
the written determination is sent to the individual. Within
twenty-one days after the receipt of the appeal, the director shall
issue a determination. A determination made under this division is
final and may be appealed pursuant to section 119.12 of the Revised
Code.

(2)
An employer shall not be a party to an appeal under division (G)(1)
of this section.

Sec.
4143.04.
An
individual who has filed a claim for family and medical leave
insurance benefits under section 4143.03 of the Revised Code to
address a qualifying exigency may take leave for any of the following
reasons:

(A)
To attend any official ceremony, program, or event sponsored by the
military that is related to the military member's covered active duty
or call to covered active duty status;

(B)
To provide or arrange for child care for the military member's child,
including enrolling or transferring the child to a new school or
daycare facility and attending meetings with staff at the school or
daycare facility, if the military member's covered active duty or
call to covered active duty status requires a change in the child's
care arrangement;

(C)
To provide or arrange for care for the military member's family
member who is incapable of self-care, including admitting or
transferring the family member to a new care facility and attending
meetings with staff at the care facility, if the military member's
covered active duty or call to covered active duty status requires a
change in the family member's care arrangement;

(D)
To provide care for the military member's family member who is
incapable of self-care during an emergency or other urgent situation
where the family member requires immediate care, if the military
member's covered active duty or call to covered active duty status
requires the individual to provide care for the family member;

(E)
To make or update financial and legal arrangements to address the
military member's absence while on covered active duty or call to
covered active duty status;

(F)
To attend counseling provided by someone other than a health care
professional, for the individual, military member, or military
member's child, if the need for counseling arises from the military
member's covered active duty or call to covered active duty status;

(G)
To spend time with the military member while the military member is
on short-term, temporary, rest and recuperation leave during the
military member's deployment;

(H)
To attend arrival ceremonies, reintegration briefings and events, and
any other official ceremony or program sponsored by the military
following the termination of the military member's covered active
duty status;

(I)
To address issues that arise from the death of the military member
while on covered active duty status.

Sec.
4143.05.
(A)
The director of job and family services shall require an individual
filing a claim for benefits under section 4143.03 of the Revised Code
to provide a certification of the individual's need for leave. The
director shall accept the following types of certification:

(1)
For an individual taking leave to care for a family member who has a
serious health condition, documentation from a health care
professional that states when the serious health condition began and
its expected duration, that the individual is needed to provide care
for the family member, and appropriate medical information supporting
the individual's claim;

(2)
For an individual taking leave for the individual's own serious
health condition, documentation from a health care professional that
states when the serious health condition began, its expected
duration, and appropriate medical information supporting the
individual's claim;

(3)
For an individual taking leave to care for a new child after the
birth or adoption of the child or the placement of the child through
foster care or to prepare for the adoption or placement of the child
through foster care, any of the following as applicable:

(a)
A birth certificate;

(b)
Documentation from a health care professional stating the date of
birth of the child;

(c)
Documentation from a health care professional, agency as defined in
section 3107.01 of the Revised Code, or other individual, as
determined by the director, stating the date of adoption or
anticipated adoption of the child;

(d)
Documentation from a health care professional, foster care agency, or
other individual, as determined by the director, stating the date of
the placement or anticipated placement of the child through foster
care;

(e)
An affadavit of the individual acknowledging parentage.

(4)
For an individual taking leave to address a qualifying exigency, a
copy of the military member's call or order to active duty or other
documentation from the applicable branch of the armed forces
supporting the individual's claim.

(B)
The director shall accept any alternative certification under
division (A) of this section that the director determines is
sufficient to demonstrate the individual's need for leave under this
chapter.

(C)(1)
A health care professional shall provide a certification under
division (A)(1) or (2) of this section at no cost to an individual
within seven calendar days of the individual's request for the
certification.

(2)
Nothing in this section requires a health care professional to issue
a certification for an individual or a family member of the
individual who has a serious health condition if the health care
professional is not providing treatment or supervision to the
individual or family member.

Sec.
4143.06.
(A)
An eligible individual shall receive a weekly benefit amount that is
equal to eighty-five per cent of the individual's average weekly
wage, except that the maximum weekly benefit amount an eligible
individual may receive under this section is an amount equal to
ninety per cent of the statewide average weekly wage. The
individual's weekly benefit amount shall be proportional to the
number of hours the individual works at the job from which the
individual is taking leave.

(B)
The director of job and family services shall reduce an eligible
individual's weekly benefit amount by the amount of either of the
following:

(1)
Any benefits the individual is receiving under Chapter 4141. of the
Revised Code;

(2)
Any benefits the individual is receiving under Chapter 4121., 4123.,
4127., or 4131. of the Revised Code, other than benefits payable
under section 4123.57 of the Revised Code in accordance with rules
adopted by the director under section 4143.02 of the Revised Code.

(C)(1)
The director shall calculate an eligible individual's weekly benefit
amount under division (A) of this section based on the individual's
average weekly wage earned from the job from which the individual is
taking leave or, if the individual is unemployed at the time of the
claim, the individual's average weekly wage during the individual's
base period. If the individual is able to continue working at a
different job while taking leave, the director shall not consider the
individual's average weekly wage from the other job when calculating
the individual's weekly benefit amount.

(2)
The director shall calculate an eligible individual's weekly benefit
amount under division (A) of this section on a prorated basis if the
individual is taking leave in separate blocks of time on an
intermittent schedule or by reducing the time the individual works
each work day or work week.

(D)(1)
The director shall make the first payment of family and medical leave
insurance benefits to an eligible individual within fourteen calendar
days after the date the director approves the individual's claim for
benefits.

(2)
The director shall make subsequent payments to an eligible individual
biweekly after the first payment under division (D)(1) of this
section.

(E)
An eligible individual may receive a maximum of eighteen weeks of
benefits payable during an application year, except that the
individual may only receive fourteen weeks of benefits for any one
reason for which the individual may receive benefits under division
(A) of section 4143.03 of the Revised Code.

(F)
Benefits under division (E) of this section are not payable for a
period of less than four consecutive hours of leave taken during one
work week.

Sec.
4143.07.
(A)
An employer may make an advance payment of family and medical leave
insurance benefits to an eligible individual. The director of job and
family services shall reimburse the employer for the amount of an
advance payment of benefits if the employer files an application with
the director in accordance with rules adopted by the director under
section 4143.02 of the Revised Code. The director shall not approve
an application that the director receives after the date the director
has made a payment to the individual for which the employer is
seeking a reimbursement.

(B)
The amount of a reimbursement shall not be greater than the amount
the individual is entitled to receive under section 4143.06 of the
Revised Code.

Sec.
4143.08.
(A)(1)
A period of leave taken by an eligible individual under this chapter
runs concurrently with any leave taken under the Family and Medical
Leave Act.

(2)
An employer may require that any leave taken under this chapter be
taken concurrently with leave allowed under the terms of disability
or family care leave under a collective bargaining agreement or
employer policy. The employer shall provide employees with a written
notice of this requirement.

(3)
An employee may utilize available sick leave, vacation leave, or
other paid leave in order to supplement the employee's weekly benefit
amount under section 4143.06 of the Revised Code during the leave
period, in an amount sufficient to give the employee up to one
hundred per cent of the employee's average weekly wage for time on
leave. No employer shall require an employee to utilize sick leave,
vacation leave, or other paid leave under this division during a
period of leave under this chapter.

(B)
An employer shall comply with a collective bargaining agreement or
employer contract entered into or renewed, or an employment policy
adopted or revised, on or after the effective date of this section
that provides employees with greater leave than that provided under
this chapter.

(C)
No collective bargaining agreement or employer contract entered into
or renewed, or employer policy adopted or revised, on or after the
effective date of this section shall diminish an individual's rights
to benefits under this chapter.

(D)
Notwithstanding any provision to the contrary in division (A) of
section 4117.10 of the Revised Code, no agreement between employee
organizations and public employers entered into on or after the
effective date of this section shall diminish an individual's rights
to benefits under this chapter.

(E)
Any agreement by an individual to waive the individual's rights under
this chapter is void as against public policy.

Sec.
4143.09.
(A)(1)
An eligible individual who takes a period of leave under this chapter
shall be restored to the individual's position of employment with the
individual's employer before taking leave, or to an equivalent
position with equivalent benefits, pay, status, and other terms and
conditions of employment.

(2)
An employer shall maintain an employee's health insurance benefits
during the period of leave on the same conditions as those benefits
would have been provided if the employee had been continuously
employed during the entire period of leave.

(B)
No employer shall discharge, demote, discriminate, or take an adverse
employment action against an employee at any time for any of the
following reasons:

(1)
The employee filed a claim or received benefits under this chapter.

(2)
The employee communicated to the employer the employee's intent to
file a claim for benefits, a complaint, or an appeal under this
chapter.

(3)
The employee testified, agreed to testify, or otherwise assisted in a
proceeding under this chapter.

(C)
No employer shall consider a period of leave an eligible individual
takes under this chapter as an absence for which the employer may
discipline, discharge, demote, suspend, or take an adverse employment
action against the employee under the employer's attendance policy.

(D)
An employee who believes that an employer has violated this section
may file a complaint with the director of job and family services
within twenty-four months after the alleged violation has occurred.
The director shall process and investigate any complaints the
director receives to determine whether it is probable that an
employer has violated this section. If the director determines that
it is probable that the employer violated this section after
providing notice and an opportunity for a hearing under Chapter 119.
of the Revised Code, the director may take either of the following
actions:

(1)
Order the employer to do any of the following:

(a)
Provide the employee with the requested leave;

(b)
Reinstate the employee to the employee's position of employment;

(c)
Pay the employee for up to two years of back pay, including interest
at the prevailing rate;

(d)
Pay the employee for liquidated damages in an amount equal to the
payment under division (D)(3) of this section;

(e)
Any other action the director determines appropriate.

(2)
Assess a penalty against the employer of up to one thousand dollars
per violation. Any penalty collected for a violation shall be
deposited into the family and medical leave insurance fund created in
section 4143.13 of the Revised Code.

(E)(1)
An aggrieved employee may bring a civil action in a court of
competent jurisdiction against an employer who the employee believes
violated this section. If the employee filed a complaint under
division (D) of this section, the employee must bring a civil action
within twenty-four months after the director has made a determination
on the employee's complaint.

(2)
If the court finds that a violation of this section has occurred, the
employer shall be liable to the aggrieved employee for any of the
following:

(a)
Damages in the amount of lost wages, salary, benefits, or other
compensation;

(b)
Damages for any actual monetary losses sustained by the employee;

(c)
Liquidated damages in an amount equal to those described in division
(E)(1)(a) or (b) of this section;

(d)
Court costs and reasonable attorney fees;

(e)
Equitable relief as may be appropriate.

Sec.
4143.10.
(A)
An independent contractor, sole proprietor, partner, or joint
venturer may elect coverage under this chapter for an initial period
of a minimum of three years. An independent contractor, sole
proprietor, partner, or joint venturer shall file a notice of
election of coverage in writing with the director of job and family
services. The election is effective on the date the notice is filed.

(B)
An independent contractor, sole proprietor, partner, or joint
venturer may elect continuing coverage under this chapter immediately
following the initial period of coverage under division (A)(1) of
this section by filing a notice for election of coverage as described
in that division at least thirty days before the initial election
period expires.

(C)
An independent contractor, sole proprietor, partner, or joint
venturer may withdraw from coverage by filing a written notice with
the director within thirty days before the end of the initial period
of coverage or during a period the director has designated by rule
under section 4143.02 of the Revised Code. The withdrawal is
effective thirty days after the notice is filed.

Sec.
4143.11.
(A)
An employer may apply to the director of job and family services for
approval to individually provide family and medical leave insurance
benefits under this chapter directly to eligible employees. The
director shall grant approval to an employer that demonstrates, to
the director's satisfaction, all of the following:

(1)
That the employer will provide benefits that are equal to or greater
than the benefits provided in section 4143.06 of the Revised Code;

(2)
That the employer will promptly meet all obligations under this
chapter;

(3)
If the employer will provide benefits through an insurer, proof that
the insurer is authorized to provide insurance in this state and a
copy of the policy.

(B)
An employer that submits an application under division (A) of this
section to provide benefits through self-insurance shall file a good
and sufficient surety executed by the employer as principal and by a
surety company as surety in the amount determined by the director.

(C)
The director shall terminate an employer's approval to provide
benefits under this section for failing to do any of the following:

(1)
Pay benefits to an eligible individual;

(2)
Pay benefits in a timely manner;

(3)
If the employer is required to file a surety under division (B) of
this section, maintain the surety;

(4)
Submit any report that the director requires the employer to submit;

(5)
Comply with any other requirement of this chapter or rules adopted by
the director under section 4143.02 of the Revised Code.

(D)
An individual whose claim for benefits is denied by the individual's
employer may appeal the decision to the director as described in
division (F)(1) of section 4143.03 of the Revised Code.

(E)
An employee who believes an employer approved to provide benefits
under this section has violated section 4143.09 of the Revised Code
may file a complaint or bring a civil action as described in that
section.

(F)
For each calendar year, the director shall determine the costs to the
family and medical leave insurance program created under section
4143.02 of the Revised Code for employers to provide benefits under
this section. Each employer shall reimburse the director for its
share of the costs, as determined by the director. The reimbursement
shall be deposited into the family and medical leave insurance fund.

Sec.
4143.12.
(A)
No individual shall receive family and medical leave insurance
benefits for one year after the individual willfully makes a false
statement or misrepresents or willfully fails to report a material
fact in connection with a claim for benefits under this chapter.

(B)(1)
The director of job and family services may seek repayment of
benefits that are paid to an individual in excess of the benefits the
individual is entitled to receive for any of the following reasons:

(a)
The individual willfully made a false statement or misrepresented or
willfully failed to report a material fact in connection with a claim
for benefits.

(b)
The individual received benefits to which the individual is
subsequently determined to not be entitled as a result of a decision
of an appeal under division (F) of section 4143.03 of the Revised
Code.

(c)
The individual received benefits to which the individual was not
entitled due to a mistake or a clerical error.

(2)
The director may waive a repayment or part of a repayment in division
(B)(1) of this section if the director decides the recovery is
against equity and good conscience.

Sec.
4143.13.
The
family and medical leave insurance fund is created, which shall be in
the custody of the treasurer of state but shall not be a part of the
state treasury. All premiums and contributions received under this
chapter and any other money collected pursuant to this chapter shall
be deposited into the fund. The treasurer of state shall invest any
portion of the fund not needed for immediate use in the same manner
as, and subject to all applicable laws regarding the investment of,
state funds. Any investment earnings of the fund shall be credited to
the fund. The treasurer of state shall disburse money from the fund
on order of the director of job and family services or a designee of
the director.

Sec.
4143.14.
(A)
The director of job and family services shall establish a premium
rate for the purpose of determining premiums under this section as
follows:

(1)
Not later than October 31, 2027, a premium rate the director
determines to assure the solvency of the family and medical leave
insurance fund created by section 4143.13 of the Revised Code based
on sound actuarial principles.

(2)
Beginning with calendar year 2031, the director shall annually
determine the premium rate not later than the thirty-first day of
October for the subsequent calendar year. The premium rate shall be
an amount necessary to ensure the solvency of the fund. The amount
necessary for solvency is an amount equal to the difference between
the assets in the fund as of the thirtieth day of June of the
previous calendar year and the sum of both of the following:

(a)
An amount equal to one hundred fifty per cent of the benefits paid
under this chapter during the previous calendar year;

(b)
The amount of the administrative costs used to administer those
benefits during the previous calendar year.

(B)
Except as provided in section 4143.11 of the Revised Code, beginning
January 1, 2028, every employer paying any wages to an employee shall
deduct and withhold from such wages for each payroll period a premium
determined by applying fifty per cent of the premium rate calculated
under division (A) of this section to such wages. The employer shall
deduct and withhold the premium on the date that the employer
directly, indirectly, or constructively pays wages to, or credits
wages to the benefit of, the employee. The employer shall remit the
premium in accordance with rules adopted under section 4143.02 of the
Revised Code.

(C)
In addition to the employee premium under division (B) of this
section, an employer with fifteen or more employees shall remit a
premium equal to the amount determined under that division for each
of the employer's employees directly to the director in accordance
with rules adopted under section 4143.02 of the Revised Code. An
employer with less than fifteen employees shall not be required to
remit a premium under this division. The number of employees an
employer has for purposes of this division shall be determined on the
first day of January of each calendar year.

(D)
An independent contractor, sole proprietor, partner, or joint
venturer who elects coverage under section 4143.10 of the Revised
Code shall remit premiums directly to the director in accordance with
rules adopted under section 4143.02 of the Revised Code. The premium
shall be determined by applying fifty per cent of the premium rate
calculated under division (A) of this section to the individual's
wages.

(E)
An employer that fails or refuses to remit premiums as required by
this section shall be assessed a penalty by the director equal to the
sum of one per cent of the employer's annual payroll for each year
the employer failed or refused to remit premiums and the amount of
benefits paid to any of the employer's employees for whom the
employer failed or refused to remit premiums. Beginning with calendar
year 2029, the director shall adjust the amount of the penalty not
later than the thirty-first day of October for the subsequent
calendar year.

Sec.
4143.15.
(A)
If the internal revenue service determines benefits under this
chapter are subject to federal income tax, the director of job and
family services shall inform an individual for whom the director
approved a claim for benefits under section 4143.03 of the Revised
Code, before making the first benefit payment, of each of the
following:

(1)
That the internal revenue service has determined that benefits are
subject to federal income tax;

(2)
The requirement for the individual to make estimated tax payments on
the basis of those benefits as required by the Internal Revenue Code;

(3)
That the individual may elect to have federal income tax deducted and
withheld from the individual's payment of benefits in the amount
authorized under the Internal Revenue Code;

(4)
That the individual may change a previously elected federal
withholding status as authorized under the Internal Revenue Code.

(B)
The director shall follow all procedures prescribed by the internal
revenue service when deducting, withholding, and remitting federal
income tax.

Sec.
4143.16.
(A)
Except as provided in division (B) of this section, any information
contained in the files and records of an individual in the possession
of the director of job and family services under this chapter is
confidential and is not a public record under section 149.43 of the
Revised Code.

(B)
The following individuals may have access to the files and records of
an individual under this chapter:

(1)
A public employee in the performance of the public employee's
official duties;

(2)
The individual or a person authorized by the individual, with an
authorization form signed by the individual;

(3)
An employer or the employer's duly authorized representative, in
connection with a pending claim of an individual employed by the
employer;

(4)
An individual who is assisting the director of job and family
services on any matter regarding the administration of this chapter,
at the director's request.

Sec.
4143.17.
(A)
Not later than April 1, 2030, and every year thereafter, the director
of job and family services shall submit a report to the general
assembly. The director shall include all of the following information
in the report for the preceding calendar year:

(1)
Projected family and medical leave insurance program participation;

(2)
Actual program participation;

(3)
Demographic information of applicants for family and medical leave
insurance benefits, including age, gender, race, ethnicity, sexual
orientation, primary or preferred language, residential zip code,
occupation, average weekly wage, and characteristics of the
applicant's employment;

(4)
Demographic information described in division (A)(3) of this section
of participants in the program;

(5)
Processing time frames for the director to approve or deny initial
claims for benefits filed by individuals under section 4143.03 of the
Revised Code;

(6)
For any claim denied by the director, the reason for the denial;

(7)
Total number of appeals filed by individuals under division (F) of
section 4143.03 of the Revised Code and the decision of those
appeals;

(8)
Average time frame from an individual filing a claim for benefits to
the individual receiving the first payment of benefits;

(9)
Purpose and duration of leave taken by participants, including the
category of family member that a participant took leave to care for;

(10)
Average weekly benefit amount paid to participants;

(11)
Premium rates;

(12)
Current and projected fund balances;

(13)
Outreach efforts.

(B)
The director shall make the report available to the public by posting
the report on the internet web site maintained by the department of
job and family services.

Sec.
4143.18.
(A)
Not later than July 1, 2027, the director of job and family services
shall develop and implement a public education program to educate
employees and employers about the family and medical leave insurance
program created under section 4143.02 of the Revised Code and the
availability of family and medical leave insurance benefits for
individuals under this chapter. The public education program shall
explain all of the following information about the program:

(1)
An individual's right to benefits under this chapter and the terms
under which an individual may receive benefits;

(2)
The claims process;

(3)
Weekly benefit amounts and maximum benefits payable;

(4)
Reinstatement and nondiscrimination rights and an individual's right
to file a complaint against an employer that violates those rights.

(B)
The director may use up to five per cent of the funds available on
the first day of January of each year in the family and medical leave
insurance fund created in section 4143.13 of the Revised Code to
implement the public education program developed under division (A)
of this section during that calendar year.

(C)
The director shall develop a program notice in English, Spanish, and
any other language spoken by more than three per cent of the state's
population, containing the information listed in division (A) of this
section.

(D)(1)
Each employer shall do all of the following:

(a)
Provide a copy of the program notice to each of the employer's
employees on hiring and every year thereafter;

(b)
Provide a copy of the program notice to an employee when the employee
notifies the employer of the employee's intent to take leave under
this chapter or take leave for any of the reasons in division (A) of
section 4143.03 of the Revised Code;

(c)
Post the program notice in a prominent location in the employer's
workplace or on the internet in a manner that is accessible to the
employer's employees;

(d)
Provide a copy of or post the program notice in accordance with any
additional requirements in rules adopted by the director under
section 4143.02 of the Revised Code.

(2)
The employer shall provide the program notice in English, the
language the employer uses in communication with an employee, or any
other language spoken by at least five per cent of the employer's
employees.

(E)
An employer that fails to provide the program notice as required by
division (D) of this section shall be assessed a two hundred fifty
dollar penalty per employee for each day the employer fails to
provide the notice. Any penalty collected under this division shall
be deposited into the family and medical leave insurance fund created
in section 4143.13 of the Revised Code.

Sec.
5747.01.
Except
as otherwise expressly provided or clearly appearing from the
context, any term used in this chapter that is not otherwise defined
in this section has the same meaning as when used in a comparable
context in the laws of the United States relating to federal income
taxes or if not used in a comparable context in those laws, has the
same meaning as in section 5733.40 of the Revised Code. Any reference
in this chapter to the Internal Revenue Code includes other laws of
the United States relating to federal income taxes.

As
used in this chapter:

(A)
"Adjusted gross income" or "Ohio adjusted gross
income" means federal adjusted gross income, as defined and used
in the Internal Revenue Code, adjusted as provided in this section:

(1)
Add interest or dividends on obligations or securities of any state
or of any political subdivision or authority of any state, other than
this state and its subdivisions and authorities.

(2)
Add interest or dividends on obligations of any authority,
commission, instrumentality, territory, or possession of the United
States to the extent that the interest or dividends are exempt from
federal income taxes but not from state income taxes.

(3)
Deduct interest or dividends on obligations of the United States and
its territories and possessions or of any authority, commission, or
instrumentality of the United States to the extent that the interest
or dividends are included in federal adjusted gross income but exempt
from state income taxes under the laws of the United States.

(4)
Deduct disability and survivor's benefits to the extent included in
federal adjusted gross income.

(5)
Deduct the following, to the extent not otherwise deducted or
excluded in computing federal or Ohio adjusted gross income:

(a)
Benefits under Title II of the Social Security Act and tier 1
railroad retirement;

(b)
Railroad retirement benefits, other than tier 1 railroad retirement
benefits, to the extent such amounts are exempt from state taxation
under federal law.

(6)
Deduct the amount of wages and salaries, if any, not otherwise
allowable as a deduction but that would have been allowable as a
deduction in computing federal adjusted gross income for the taxable
year, had the work opportunity tax credit allowed and determined
under sections 38, 51, and 52 of the Internal Revenue Code not been
in effect.

(7)
Deduct any interest or interest equivalent on public obligations and
purchase obligations to the extent that the interest or interest
equivalent is included in federal adjusted gross income.

(8)
Add any loss or deduct any gain resulting from the sale, exchange, or
other disposition of public obligations to the extent that the loss
has been deducted or the gain has been included in computing federal
adjusted gross income.

(9)
Deduct or add amounts, as provided under section 5747.70 of the
Revised Code, related to contributions made to or tuition units
purchased under a qualified tuition program established pursuant to
section 529 of the Internal Revenue Code.

(10)(a)
Deduct, to the extent not otherwise allowable as a deduction or
exclusion in computing federal or Ohio adjusted gross income for the
taxable year, the amount the taxpayer paid during the taxable year
for medical care insurance and qualified long-term care insurance for
the taxpayer, the taxpayer's spouse, and dependents. No deduction for
medical care insurance under division (A)(10)(a) of this section
shall be allowed either to any taxpayer who is eligible to
participate in any subsidized health plan maintained by any employer
of the taxpayer or of the taxpayer's spouse, or to any taxpayer who
is entitled to, or on application would be entitled to, benefits
under part A of Title XVIII of the "Social Security Act,"
49 Stat. 620 (1935), 42 U.S.C. 301, as amended. For the purposes of
division (A)(10)(a) of this section, "subsidized health plan"
means a health plan for which the employer pays any portion of the
plan's cost. The deduction allowed under division (A)(10)(a) of this
section shall be the net of any related premium refunds, related
premium reimbursements, or related insurance premium dividends
received during the taxable year.

(b)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income during the taxable year, the
amount the taxpayer paid during the taxable year, not compensated for
by any insurance or otherwise, for medical care of the taxpayer, the
taxpayer's spouse, and dependents, to the extent the expenses exceed
seven and one-half per cent of the taxpayer's federal adjusted gross
income.

(c)
For purposes of division (A)(10) of this section, "medical care"
has the meaning given in section 213 of the Internal Revenue Code,
subject to the special rules, limitations, and exclusions set forth
therein, and "qualified long-term care" has the same
meaning given in section 7702B(c) of the Internal Revenue Code.
Solely for purposes of division (A)(10)(a) of this section,
"dependent" includes a person who otherwise would be a
"qualifying relative" and thus a "dependent"
under section 152 of the Internal Revenue Code but for the fact that
the person fails to meet the income and support limitations under
section 152(d)(1)(B) and (C) of the Internal Revenue Code.

(11)(a)
Deduct any amount included in federal adjusted gross income solely
because the amount represents a reimbursement or refund of expenses
that in any year the taxpayer had deducted as an itemized deduction
pursuant to section 63 of the Internal Revenue Code and applicable
United States department of the treasury regulations. The deduction
otherwise allowed under division (A)(11)(a) of this section shall be
reduced to the extent the reimbursement is attributable to an amount
the taxpayer deducted under this section in any taxable year.

(b)
Add any amount not otherwise included in Ohio adjusted gross income
for any taxable year to the extent that the amount is attributable to
the recovery during the taxable year of any amount deducted or
excluded in computing federal or Ohio adjusted gross income in any
taxable year.

(12)
Deduct any portion of the deduction described in section 1341(a)(2)
of the Internal Revenue Code, for repaying previously reported income
received under a claim of right, that meets both of the following
requirements:

(a)
It is allowable for repayment of an item that was included in the
taxpayer's adjusted gross income for a prior taxable year and did not
qualify for a credit under division (A) or (B) of section 5747.05 of
the Revised Code for that year;

(b)
It does not otherwise reduce the taxpayer's adjusted gross income for
the current or any other taxable year.

(13)
Deduct an amount equal to the deposits made to, and net investment
earnings of, a medical savings account during the taxable year, in
accordance with section 3924.66 of the Revised Code. The deduction
allowed by division (A)(13) of this section does not apply to medical
savings account deposits and earnings otherwise deducted or excluded
for the current or any other taxable year from the taxpayer's federal
adjusted gross income.

(14)(a)
Add an amount equal to the funds withdrawn from a medical savings
account during the taxable year, and the net investment earnings on
those funds, when the funds withdrawn were used for any purpose other
than to reimburse an account holder for, or to pay, eligible medical
expenses, in accordance with section 3924.66 of the Revised Code;

(b)
Add the amounts distributed from a medical savings account under
division (A)(2) of section 3924.68 of the Revised Code during the
taxable year.

(15)
Add any amount claimed as a credit under section 5747.059 of the
Revised Code to the extent that such amount satisfies either of the
following:

(a)
The amount was deducted or excluded from the computation of the
taxpayer's federal adjusted gross income as required to be reported
for the taxpayer's taxable year under the Internal Revenue Code;

(b)
The amount resulted in a reduction of the taxpayer's federal adjusted
gross income as required to be reported for any of the taxpayer's
taxable years under the Internal Revenue Code.

(16)
Deduct the amount contributed by the taxpayer to an individual
development account program established by a county department of job
and family services pursuant to sections 329.11 to 329.14 of the
Revised Code for the purpose of matching funds deposited by program
participants. On request of the tax commissioner, the taxpayer shall
provide any information that, in the tax commissioner's opinion, is
necessary to establish the amount deducted under division (A)(16) of
this section.

(17)(a)(i)
Subject to divisions (A)(17)(a)(iii), (iv), and (v) of this section,
add five-sixths of the amount of depreciation expense allowed by
subsection (k) of section 168 of the Internal Revenue Code, including
the taxpayer's proportionate or distributive share of the amount of
depreciation expense allowed by that subsection to a pass-through
entity in which the taxpayer has a direct or indirect ownership
interest.

(ii)
Subject to divisions (A)(17)(a)(iii), (iv), and (v) of this section,
add five-sixths of the amount of qualifying section 179 depreciation
expense, including the taxpayer's proportionate or distributive share
of the amount of qualifying section 179 depreciation expense allowed
to any pass-through entity in which the taxpayer has a direct or
indirect ownership interest.

(iii)
Subject to division (A)(17)(a)(v) of this section, for taxable years
beginning in 2012 or thereafter, if the increase in income taxes
withheld by the taxpayer is equal to or greater than ten per cent of
income taxes withheld by the taxpayer during the taxpayer's
immediately preceding taxable year, "two-thirds" shall be
substituted for "five-sixths" for the purpose of divisions
(A)(17)(a)(i) and (ii) of this section.

(iv)
Subject to division (A)(17)(a)(v) of this section, for taxable years
beginning in 2012 or thereafter, a taxpayer is not required to add an
amount under division (A)(17) of this section if the increase in
income taxes withheld by the taxpayer and by any pass-through entity
in which the taxpayer has a direct or indirect ownership interest is
equal to or greater than the sum of (I) the amount of qualifying
section 179 depreciation expense and (II) the amount of depreciation
expense allowed to the taxpayer by subsection (k) of section 168 of
the Internal Revenue Code, and including the taxpayer's proportionate
or distributive shares of such amounts allowed to any such
pass-through entities.

(v)
If a taxpayer directly or indirectly incurs a net operating loss for
the taxable year for federal income tax purposes, to the extent such
loss resulted from depreciation expense allowed by subsection (k) of
section 168 of the Internal Revenue Code and by qualifying section
179 depreciation expense, "the entire" shall be substituted
for "five-sixths of the" for the purpose of divisions
(A)(17)(a)(i) and (ii) of this section.

The
tax commissioner, under procedures established by the commissioner,
may waive the add-backs related to a pass-through entity if the
taxpayer owns, directly or indirectly, less than five per cent of the
pass-through entity.

(b)
Nothing in division (A)(17) of this section shall be construed to
adjust or modify the adjusted basis of any asset.

(c)
To the extent the add-back required under division (A)(17)(a) of this
section is attributable to property generating nonbusiness income or
loss allocated under section 5747.20 of the Revised Code, the
add-back shall be sitused to the same location as the nonbusiness
income or loss generated by the property for the purpose of
determining the credit under division (A) of section 5747.05 of the
Revised Code. Otherwise, the add-back shall be apportioned, subject
to one or more of the four alternative methods of apportionment
enumerated in section 5747.21 of the Revised Code.

(d)
For the purposes of division (A)(17)(a)(v) of this section, net
operating loss carryback and carryforward shall not include the
allowance of any net operating loss deduction carryback or
carryforward to the taxable year to the extent such loss resulted
from depreciation allowed by section 168(k) of the Internal Revenue
Code and by the qualifying section 179 depreciation expense amount.

(e)
For the purposes of divisions (A)(17) and (18) of this section:

(i)
"Income taxes withheld" means the total amount withheld and
remitted under sections 5747.06 and 5747.07 of the Revised Code by an
employer during the employer's taxable year.

(ii)
"Increase in income taxes withheld" means the amount by
which the amount of income taxes withheld by an employer during the
employer's current taxable year exceeds the amount of income taxes
withheld by that employer during the employer's immediately preceding
taxable year.

(iii)
"Qualifying section 179 depreciation expense" means the
difference between (I) the amount of depreciation expense directly or
indirectly allowed to a taxpayer under section 179 of the Internal
Revised Code, and (II) the amount of depreciation expense directly or
indirectly allowed to the taxpayer under section 179 of the Internal
Revenue Code as that section existed on December 31, 2002.

(18)(a)
If the taxpayer was required to add an amount under division
(A)(17)(a) of this section for a taxable year, deduct one of the
following:

(i)
One-fifth of the amount so added for each of the five succeeding
taxable years if the amount so added was five-sixths of qualifying
section 179 depreciation expense or depreciation expense allowed by
subsection (k) of section 168 of the Internal Revenue Code;

(ii)
One-half of the amount so added for each of the two succeeding
taxable years if the amount so added was two-thirds of such
depreciation expense;

(iii)
One-sixth of the amount so added for each of the six succeeding
taxable years if the entire amount of such depreciation expense was
so added.

(b)
If the amount deducted under division (A)(18)(a) of this section is
attributable to an add-back allocated under division (A)(17)(c) of
this section, the amount deducted shall be sitused to the same
location. Otherwise, the deduction shall be apportioned using the
apportionment factors for the taxable year in which the deduction is
taken, subject to one or more of the four alternative methods of
apportionment enumerated in section 5747.21 of the Revised Code.

(c)
No deduction is available under division (A)(18)(a) of this section
with regard to any depreciation allowed by section 168(k) of the
Internal Revenue Code and by the qualifying section 179 depreciation
expense amount to the extent that such depreciation results in or
increases a federal net operating loss carryback or carryforward. If
no such deduction is available for a taxable year, the taxpayer may
carry forward the amount not deducted in such taxable year to the
next taxable year and add that amount to any deduction otherwise
available under division (A)(18)(a) of this section for that next
taxable year. The carryforward of amounts not so deducted shall
continue until the entire addition required by division (A)(17)(a) of
this section has been deducted.

(19)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income for the taxable year, the
amount the taxpayer received during the taxable year as reimbursement
for life insurance premiums under section 5919.31 of the Revised
Code.

(20)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income for the taxable year, the
amount the taxpayer received during the taxable year as a death
benefit paid by the adjutant general under section 5919.33 of the
Revised Code.

(21)
Deduct, to the extent included in federal adjusted gross income and
not otherwise allowable as a deduction or exclusion in computing
federal or Ohio adjusted gross income for the taxable year, military
pay and allowances received by the taxpayer during the taxable year
for active duty service in the armed forces of the United States, as
defined in section 5907.01 of the Revised Code, or reserve components
thereof or the national guard. The deduction may not be claimed for
military pay and allowances received by the taxpayer while the
taxpayer is stationed in this state.

(22)
Deduct, to the extent not otherwise allowable as a deduction or
exclusion in computing federal or Ohio adjusted gross income for the
taxable year and not otherwise compensated for by any other source,
the amount of qualified organ donation expenses incurred by the
taxpayer during the taxable year, not to exceed ten thousand dollars.
A taxpayer may deduct qualified organ donation expenses only once for
all taxable years beginning with taxable years beginning in 2007.

For
the purposes of division (A)(22) of this section:

(a)
"Human organ" means all or any portion of a human liver,
pancreas, kidney, intestine, or lung, and any portion of human bone
marrow.

(b)
"Qualified organ donation expenses" means travel expenses,
lodging expenses, and wages and salary forgone by a taxpayer in
connection with the taxpayer's donation, while living, of one or more
of the taxpayer's human organs to another human being.

(23)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income for the taxable year, amounts
received by the taxpayer as retired personnel pay for service in the
uniformed services or reserve components thereof, or the national
guard, or received by the surviving spouse or former spouse of such a
taxpayer under the survivor benefit plan on account of such a
taxpayer's death. If the taxpayer receives income on account of
retirement paid under the federal civil service retirement system or
federal employees retirement system, or under any successor
retirement program enacted by the congress of the United States that
is established and maintained for retired employees of the United
States government, and such retirement income is based, in whole or
in part, on credit for the taxpayer's uniformed service, the
deduction allowed under this division shall include only that portion
of such retirement income that is attributable to the taxpayer's
uniformed service, to the extent that portion of such retirement
income is otherwise included in federal adjusted gross income and is
not otherwise deducted under this section. Any amount deducted under
division (A)(23) of this section is not included in a taxpayer's
adjusted gross income for the purposes of section 5747.055 of the
Revised Code. No amount may be deducted under division (A)(23) of
this section on the basis of which a credit was claimed under section
5747.055 of the Revised Code.

(24)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income for the taxable year, the
amount the taxpayer received during the taxable year from the
military injury relief fund created in section 5902.05 of the Revised
Code.

(25)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income for the taxable year, the
amount the taxpayer received as a veterans bonus during the taxable
year from the Ohio department of veterans services as authorized by
Section 2r of Article VIII, Ohio Constitution.

(26)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income for the taxable year, any
income derived from a transfer agreement or from the enterprise
transferred under that agreement under section 4313.02 of the Revised
Code.

(27)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income for the taxable year, Ohio
college opportunity or federal Pell grant amounts received by the
taxpayer or the taxpayer's spouse or dependent pursuant to section
3333.122 of the Revised Code or 20 U.S.C. 1070a, et seq., and used to
pay room or board furnished by the educational institution for which
the grant was awarded at the institution's facilities, including meal
plans administered by the institution. For the purposes of this
division, receipt of a grant includes the distribution of a grant
directly to an educational institution and the crediting of the grant
to the enrollee's account with the institution.

(28)
Deduct from the portion of an individual's federal adjusted gross
income that is business income, to the extent not otherwise deducted
or excluded in computing federal adjusted gross income for the
taxable year, one hundred twenty-five thousand dollars for each
spouse if spouses file separate returns under section 5747.08 of the
Revised Code or two hundred fifty thousand dollars for all other
individuals.

(29)
Deduct, as provided under section 5747.78 of the Revised Code,
contributions to ABLE savings accounts made in accordance with
sections 113.50 to 113.56 of the Revised Code.

(30)(a)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income during the taxable year, all of
the following:

(i)
Compensation paid to a qualifying employee described in division
(A)(14)(a) of section 5703.94 of the Revised Code to the extent such
compensation is for disaster work conducted in this state during a
disaster response period pursuant to a qualifying solicitation
received by the employee's employer;

(ii)
Compensation paid to a qualifying employee described in division
(A)(14)(b) of section 5703.94 of the Revised Code to the extent such
compensation is for disaster work conducted in this state by the
employee during the disaster response period on critical
infrastructure owned or used by the employee's employer;

(iii)
Income received by an out-of-state disaster business for disaster
work conducted in this state during a disaster response period, or,
if the out-of-state disaster business is a pass-through entity, a
taxpayer's distributive share of the pass-through entity's income
from the business conducting disaster work in this state during a
disaster response period, if, in either case, the disaster work is
conducted pursuant to a qualifying solicitation received by the
business.

(b)
All terms used in division (A)(30) of this section have the same
meanings as in section 5703.94 of the Revised Code.

(31)
For a taxpayer who is a qualifying Ohio educator, deduct, to the
extent not otherwise deducted or excluded in computing federal or
Ohio adjusted gross income for the taxable year, the lesser of three
hundred dollars or the amount of expenses described in subsections
(a)(2)(D)(i) and (ii) of section 62 of the Internal Revenue Code paid
or incurred by the taxpayer during the taxpayer's taxable year in
excess of the amount the taxpayer is authorized to deduct for that
taxable year under subsection (a)(2)(D) of that section.

(32)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income for the taxable year, amounts
received by the taxpayer as a disability severance payment, computed
under 10 U.S.C. 1212, following discharge or release under honorable
conditions from the armed forces of the United States, as defined in
section 5907.01 of the Revised Code.

(33)
Deduct, to the extent not otherwise deducted or excluded in computing
federal adjusted gross income or Ohio adjusted gross income, amounts
not subject to tax due to an agreement entered into under division
(A)(2) of section 5747.05 of the Revised Code.

(34)
Deduct amounts as provided under section 5747.79 of the Revised Code
related to the taxpayer's qualifying capital gains and deductible
payroll.

To
the extent a qualifying capital gain described under division (A)(34)
of this section is business income, the taxpayer shall deduct those
gains under this division before deducting any such gains under
division (A)(28) of this section.

(35)(a)
For taxable years beginning in or after 2026, deduct, to the extent
not otherwise deducted or excluded in computing federal or Ohio
adjusted gross income for the taxable year:

(i)
One hundred per cent of the capital gain received by the taxpayer in
the taxable year from a qualifying interest in an Ohio venture
capital operating company attributable to the company's investments
in Ohio businesses during the period for which the company was an
Ohio venture operating company; and

(ii)
Fifty per cent of the capital gain received by the taxpayer in the
taxable year from a qualifying interest in an Ohio venture capital
operating company attributable to the company's investments in all
other businesses during the period for which the company was an Ohio
venture operating company.

(b)
Add amounts previously deducted by the taxpayer under division
(A)(35)(a) of this section if the director of development certifies
to the tax commissioner that the requirements for the deduction were
not met.

(c)
All terms used in division (A)(35) of this section have the same
meanings as in section 122.851 of the Revised Code.

(d)
To the extent a capital gain described in division (A)(35)(a) of this
section is business income, the taxpayer shall apply that division
before applying division (A)(28) of this section.

(36)
Add, to the extent not otherwise included in computing federal or
Ohio adjusted gross income for any taxable year, the taxpayer's
proportionate share of the amount of the tax levied under section
5747.38 of the Revised Code and paid by an electing pass-through
entity for the taxable year.

Notwithstanding
any provision of the Revised Code to the contrary, the portion of the
addition required by division (A)(36) of this section related to the
apportioned business income of the pass-through entity shall be
considered business income under division (B) of this section. Such
addition is eligible for the deduction in division (A)(28) of this
section, subject to the applicable dollar limitations, and the tax
rate prescribed by division (A)(4)(a) of section 5747.02 of the
Revised Code. The taxpayer shall provide, upon request of the tax
commissioner, any documentation necessary to verify the portion of
the addition that is business income under this division.

(37)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income for the taxable year, amounts
delivered to a qualifying institution pursuant to section 3333.128 of
the Revised Code for the benefit of the taxpayer or the taxpayer's
spouse or dependent.

(38)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income for the taxable year, amounts
received under the Ohio adoption grant program pursuant to section
5180.451 of the Revised Code.

(39)
Deduct, to the extent included in federal adjusted gross income,
income attributable to amounts provided to a taxpayer for any of the
purposes for which an exclusion would have been authorized under
section 139 of the Internal Revenue Code if the train derailment near
the city of East Palestine on February 3, 2023, had been a qualified
disaster pursuant to that section, or to compensate for lost business
resulting from that derailment, if such amounts are provided by any
of the following:

(a)
A federal, state, or local government agency;

(b)
A railroad company, as that term is defined in section 5727.01 of the
Revised Code;

(c)
Any subsidiary, insurer, or agent of a railroad company or any
related person.

Notwithstanding
any provision to the contrary, the derailment is not required to meet
the definition of a "qualified disaster" pursuant to
section 139 of the Internal Revenue Code to qualify for the deduction
under this section.

(40)
Deduct, to the extent included in federal adjusted gross income,
income attributable to loan repayments on behalf of the taxpayer
under the rural practice incentive program under section 3333.135 of
the Revised Code.

(41)
Add any income taxes deducted in computing federal or Ohio adjusted
gross income to the extent the income taxes were derived from income
subject to a tax levied in another state or the District of Columbia
when such tax was enacted for purposes of complying with internal
revenue service notice 2020-75.

Notwithstanding
any provision of the Revised Code to the contrary, the portion of the
addition required by division (A)(41) of this section related to the
apportioned business income of the pass-through entity shall be
considered business income under division (B) of this section. Such
addition is eligible for the deduction in division (A)(28) of this
section, subject to the applicable dollar limitations, and the tax
rate prescribed by division (A)(4)(a) of section 5747.02 of the
Revised Code. The taxpayer shall provide, upon request of the tax
commissioner, any documentation necessary to verify the portion of
the addition that is business income under this division.

(42)
Deduct amounts contributed to a homeownership savings account and
calculated pursuant to divisions (B) and (C) of section 5747.85 of
the Revised Code.

(43)
If the taxpayer is the account owner of a homeownership savings
account, upon withdrawal or transfer of funds from the account, or
closure of the account containing funds that are not used for
eligible expenses, add the amount of such funds not used for an
eligible expense. The addition required under this division shall not
exceed the sum of the amounts deducted by the taxpayer for such
account under division (A)(42) of this section in any taxable year
and the amount of any funds deposited in the account by a contributor
other than the account owner. As used in division (A)(43) of this
section, "homeownership savings account," "contributor,"
"account owner," and "eligible expenses" have the
same meanings as in section 5747.85 of the Revised Code.

(44)
Deduct, to the extent not otherwise deducted or excluded in computing
federal or Ohio adjusted gross income during the taxable year, up to
seven hundred fifty dollars of contributions the taxpayer makes to a
pregnancy resource center that meets the criteria in division (B) of
section 5180.71 of the Revised Code.

(45)
Deduct benefits under Chapter 4143. of the Revised Code to the extent
included in federal adjusted gross income.

(B)
"Business income" means income, including gain or loss,
arising from transactions, activities, and sources in the regular
course of a trade or business and includes income, gain, or loss from
real property, tangible property, and intangible property if the
acquisition, rental, management, and disposition of the property
constitute integral parts of the regular course of a trade or
business operation. "Business income" includes income,
including gain or loss, from a partial or complete liquidation of a
business, including, but not limited to, gain or loss from the sale
or other disposition of goodwill or the sale of an equity or
ownership interest in a business.

As
used in this division, the "sale of an equity or ownership
interest in a business" means sales to which either or both of
the following apply:

(1)
The sale is treated for federal income tax purposes as the sale of
assets.

(2)
The seller materially participated, as described in 26 C.F.R.
1.469-5T, in the activities of the business during the taxable year
in which the sale occurs or during any of the five preceding taxable
years.

(C)
"Nonbusiness income" means all income other than business
income and may include, but is not limited to, compensation, rents
and royalties from real or tangible personal property, capital gains,
interest, dividends and distributions, patent or copyright royalties,
or lottery winnings, prizes, and awards.

(D)
"Compensation" means any form of remuneration paid to an
employee for personal services.

(E)
"Fiduciary" means a guardian, trustee, executor,
administrator, receiver, conservator, or any other person acting in
any fiduciary capacity for any individual, trust, or estate.

(F)
"Fiscal year" means an accounting period of twelve months
ending on the last day of any month other than December.

(G)
"Individual" means any natural person.

(H)
"Internal Revenue Code" means the "Internal Revenue
Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 1, as amended.

(I)
"Resident" means any of the following:

(1)
An individual who is domiciled in this state, subject to section
5747.24 of the Revised Code;

(2)
The estate of a decedent who at the time of death was domiciled in
this state. The domicile tests of section 5747.24 of the Revised Code
are not controlling for purposes of division (I)(2) of this section.

(3)
A trust that, in whole or part, resides in this state. If only part
of a trust resides in this state, the trust is a resident only with
respect to that part.

For
the purposes of division (I)(3) of this section:

(a)
A trust resides in this state for the trust's current taxable year to
the extent, as described in division (I)(3)(d) of this section, that
the trust consists directly or indirectly, in whole or in part, of
assets, net of any related liabilities, that were transferred, or
caused to be transferred, directly or indirectly, to the trust by any
of the following:

(i)
A person, a court, or a governmental entity or instrumentality on
account of the death of a decedent, but only if the trust is
described in division (I)(3)(e)(i) or (ii) of this section;

(ii)
A person who was domiciled in this state for the purposes of this
chapter when the person directly or indirectly transferred assets to
an irrevocable trust, but only if at least one of the trust's
qualifying beneficiaries is domiciled in this state for the purposes
of this chapter during all or some portion of the trust's current
taxable year;

(iii)
A person who was domiciled in this state for the purposes of this
chapter when the trust document or instrument or part of the trust
document or instrument became irrevocable, but only if at least one
of the trust's qualifying beneficiaries is a resident domiciled in
this state for the purposes of this chapter during all or some
portion of the trust's current taxable year. If a trust document or
instrument became irrevocable upon the death of a person who at the
time of death was domiciled in this state for purposes of this
chapter, that person is a person described in division (I)(3)(a)(iii)
of this section.

(b)
A trust is irrevocable to the extent that the transferor is not
considered to be the owner of the net assets of the trust under
sections 671 to 678 of the Internal Revenue Code.

(c)
With respect to a trust other than a charitable lead trust,
"qualifying beneficiary" has the same meaning as "potential
current beneficiary" as defined in section 1361(e)(2) of the
Internal Revenue Code, and with respect to a charitable lead trust
"qualifying beneficiary" is any current, future, or
contingent beneficiary, but with respect to any trust "qualifying
beneficiary" excludes a person or a governmental entity or
instrumentality to any of which a contribution would qualify for the
charitable deduction under section 170 of the Internal Revenue Code.

(d)
For the purposes of division (I)(3)(a) of this section, the extent to
which a trust consists directly or indirectly, in whole or in part,
of assets, net of any related liabilities, that were transferred
directly or indirectly, in whole or part, to the trust by any of the
sources enumerated in that division shall be ascertained by
multiplying the fair market value of the trust's assets, net of
related liabilities, by the qualifying ratio, which shall be computed
as follows:

(i)
The first time the trust receives assets, the numerator of the
qualifying ratio is the fair market value of those assets at that
time, net of any related liabilities, from sources enumerated in
division (I)(3)(a) of this section. The denominator of the qualifying
ratio is the fair market value of all the trust's assets at that
time, net of any related liabilities.

(ii)
Each subsequent time the trust receives assets, a revised qualifying
ratio shall be computed. The numerator of the revised qualifying
ratio is the sum of (1) the fair market value of the trust's assets
immediately prior to the subsequent transfer, net of any related
liabilities, multiplied by the qualifying ratio last computed without
regard to the subsequent transfer, and (2) the fair market value of
the subsequently transferred assets at the time transferred, net of
any related liabilities, from sources enumerated in division
(I)(3)(a) of this section. The denominator of the revised qualifying
ratio is the fair market value of all the trust's assets immediately
after the subsequent transfer, net of any related liabilities.

(iii)
Whether a transfer to the trust is by or from any of the sources
enumerated in division (I)(3)(a) of this section shall be ascertained
without regard to the domicile of the trust's beneficiaries.

(e)
For the purposes of division (I)(3)(a)(i) of this section:

(i)
A trust is described in division (I)(3)(e)(i) of this section if the
trust is a testamentary trust and the testator of that testamentary
trust was domiciled in this state at the time of the testator's death
for purposes of the taxes levied under Chapter 5731. of the Revised
Code.

(ii)
A trust is described in division (I)(3)(e)(ii) of this section if the
transfer is a qualifying transfer described in any of divisions
(I)(3)(f)(i) to (vi) of this section, the trust is an irrevocable
inter vivos trust, and at least one of the trust's qualifying
beneficiaries is domiciled in this state for purposes of this chapter
during all or some portion of the trust's current taxable year.

(f)
For the purposes of division (I)(3)(e)(ii) of this section, a
"qualifying transfer" is a transfer of assets, net of any
related liabilities, directly or indirectly to a trust, if the
transfer is described in any of the following:

(i)
The transfer is made to a trust, created by the decedent before the
decedent's death and while the decedent was domiciled in this state
for the purposes of this chapter, and, prior to the death of the
decedent, the trust became irrevocable while the decedent was
domiciled in this state for the purposes of this chapter.

(ii)
The transfer is made to a trust to which the decedent, prior to the
decedent's death, had directly or indirectly transferred assets, net
of any related liabilities, while the decedent was domiciled in this
state for the purposes of this chapter, and prior to the death of the
decedent the trust became irrevocable while the decedent was
domiciled in this state for the purposes of this chapter.

(iii)
The transfer is made on account of a contractual relationship
existing directly or indirectly between the transferor and either the
decedent or the estate of the decedent at any time prior to the date
of the decedent's death, and the decedent was domiciled in this state
at the time of death for purposes of the taxes levied under Chapter
5731. of the Revised Code.

(iv)
The transfer is made to a trust on account of a contractual
relationship existing directly or indirectly between the transferor
and another person who at the time of the decedent's death was
domiciled in this state for purposes of this chapter.

(v)
The transfer is made to a trust on account of the will of a testator
who was domiciled in this state at the time of the testator's death
for purposes of the taxes levied under Chapter 5731. of the Revised
Code.

(vi)
The transfer is made to a trust created by or caused to be created by
a court, and the trust was directly or indirectly created in
connection with or as a result of the death of an individual who, for
purposes of the taxes levied under Chapter 5731. of the Revised Code,
was domiciled in this state at the time of the individual's death.

(g)
The tax commissioner may adopt rules to ascertain the part of a trust
residing in this state.

(J)
"Nonresident" means an individual or estate that is not a
resident. An individual who is a resident for only part of a taxable
year is a nonresident for the remainder of that taxable year.

(K)
"Pass-through entity" has the same meaning as in section
5733.04 of the Revised Code.

(L)
"Return" means the notifications and reports required to be
filed pursuant to this chapter for the purpose of reporting the tax
due and includes declarations of estimated tax when so required.

(M)
"Taxable year" means the calendar year or the taxpayer's
fiscal year ending during the calendar year, or fractional part
thereof, upon which the adjusted gross income is calculated pursuant
to this chapter.

(N)
"Taxpayer" means any person subject to the tax imposed by
section 5747.02 of the Revised Code or any pass-through entity that
makes the election under division (D) of section 5747.08 of the
Revised Code.

(O)
"Dependents" means one of the following:

(1)
For taxable years beginning on or after January 1, 2018, and before
January 1, 2026, dependents as defined in the Internal Revenue Code;

(2)
For all other taxable years, dependents as defined in the Internal
Revenue Code and as claimed in the taxpayer's federal income tax
return for the taxable year or which the taxpayer would have been
permitted to claim had the taxpayer filed a federal income tax
return.

(P)
"Principal county of employment" means, in the case of a
nonresident, the county within the state in which a taxpayer performs
services for an employer or, if those services are performed in more
than one county, the county in which the major portion of the
services are performed.

(Q)
As used in sections 5747.50 to 5747.55 of the Revised Code:

(1)
"Subdivision" means any county, municipal corporation, park
district, or township.

(2)
"Essential local government purposes" includes all
functions that any subdivision is required by general law to
exercise, including like functions that are exercised under a charter
adopted pursuant to the Ohio Constitution.

(R)
"Overpayment" means any amount already paid that exceeds
the figure determined to be the correct amount of the tax.

(S)
"Taxable income" or "Ohio taxable income" applies
only to estates and trusts, and means federal taxable income, as
defined and used in the Internal Revenue Code, adjusted as follows:

(1)
Add interest or dividends, net of ordinary, necessary, and reasonable
expenses not deducted in computing federal taxable income, on
obligations or securities of any state or of any political
subdivision or authority of any state, other than this state and its
subdivisions and authorities, but only to the extent that such net
amount is not otherwise includible in Ohio taxable income and is
described in either division (S)(1)(a) or (b) of this section:

(a)
The net amount is not attributable to the S portion of an electing
small business trust and has not been distributed to beneficiaries
for the taxable year;

(b)
The net amount is attributable to the S portion of an electing small
business trust for the taxable year.

(2)
Add interest or dividends, net of ordinary, necessary, and reasonable
expenses not deducted in computing federal taxable income, on
obligations of any authority, commission, instrumentality, territory,
or possession of the United States to the extent that the interest or
dividends are exempt from federal income taxes but not from state
income taxes, but only to the extent that such net amount is not
otherwise includible in Ohio taxable income and is described in
either division (S)(1)(a) or (b) of this section;

(3)
Add the amount of personal exemption allowed to the estate pursuant
to section 642(b) of the Internal Revenue Code;

(4)
Deduct interest or dividends, net of related expenses deducted in
computing federal taxable income, on obligations of the United States
and its territories and possessions or of any authority, commission,
or instrumentality of the United States to the extent that the
interest or dividends are exempt from state taxes under the laws of
the United States, but only to the extent that such amount is
included in federal taxable income and is described in either
division (S)(1)(a) or (b) of this section;

(5)
Deduct the amount of wages and salaries, if any, not otherwise
allowable as a deduction but that would have been allowable as a
deduction in computing federal taxable income for the taxable year,
had the work opportunity tax credit allowed under sections 38, 51,
and 52 of the Internal Revenue Code not been in effect, but only to
the extent such amount relates either to income included in federal
taxable income for the taxable year or to income of the S portion of
an electing small business trust for the taxable year;

(6)
Deduct any interest or interest equivalent, net of related expenses
deducted in computing federal taxable income, on public obligations
and purchase obligations, but only to the extent that such net amount
relates either to income included in federal taxable income for the
taxable year or to income of the S portion of an electing small
business trust for the taxable year;

(7)
Add any loss or deduct any gain resulting from sale, exchange, or
other disposition of public obligations to the extent that such loss
has been deducted or such gain has been included in computing either
federal taxable income or income of the S portion of an electing
small business trust for the taxable year;

(8)
Except in the case of the final return of an estate, add any amount
deducted by the taxpayer on both its Ohio estate tax return pursuant
to section 5731.14 of the Revised Code, and on its federal income tax
return in determining federal taxable income;

(9)(a)
Deduct any amount included in federal taxable income solely because
the amount represents a reimbursement or refund of expenses that in a
previous year the decedent had deducted as an itemized deduction
pursuant to section 63 of the Internal Revenue Code and applicable
treasury regulations. The deduction otherwise allowed under division
(S)(9)(a) of this section shall be reduced to the extent the
reimbursement is attributable to an amount the taxpayer or decedent
deducted under this section in any taxable year.

(b)
Add any amount not otherwise included in Ohio taxable income for any
taxable year to the extent that the amount is attributable to the
recovery during the taxable year of any amount deducted or excluded
in computing federal or Ohio taxable income in any taxable year, but
only to the extent such amount has not been distributed to
beneficiaries for the taxable year.

(10)
Deduct any portion of the deduction described in section 1341(a)(2)
of the Internal Revenue Code, for repaying previously reported income
received under a claim of right, that meets both of the following
requirements:

(a)
It is allowable for repayment of an item that was included in the
taxpayer's taxable income or the decedent's adjusted gross income for
a prior taxable year and did not qualify for a credit under division
(A) or (B) of section 5747.05 of the Revised Code for that year.

(b)
It does not otherwise reduce the taxpayer's taxable income or the
decedent's adjusted gross income for the current or any other taxable
year.

(11)
Add any amount claimed as a credit under section 5747.059 of the
Revised Code to the extent that the amount satisfies either of the
following:

(a)
The amount was deducted or excluded from the computation of the
taxpayer's federal taxable income as required to be reported for the
taxpayer's taxable year under the Internal Revenue Code;

(b)
The amount resulted in a reduction in the taxpayer's federal taxable
income as required to be reported for any of the taxpayer's taxable
years under the Internal Revenue Code.

(12)
Deduct any amount, net of related expenses deducted in computing
federal taxable income, that a trust is required to report as farm
income on its federal income tax return, but only if the assets of
the trust include at least ten acres of land satisfying the
definition of "land devoted exclusively to agricultural use"
under section 5713.30 of the Revised Code, regardless of whether the
land is valued for tax purposes as such land under sections 5713.30
to 5713.38 of the Revised Code. If the trust is a pass-through entity
investor, section 5747.231 of the Revised Code applies in
ascertaining if the trust is eligible to claim the deduction provided
by division (S)(12) of this section in connection with the
pass-through entity's farm income.

Except
for farm income attributable to the S portion of an electing small
business trust, the deduction provided by division (S)(12) of this
section is allowed only to the extent that the trust has not
distributed such farm income.

(13)
Add the net amount of income described in section 641(c) of the
Internal Revenue Code to the extent that amount is not included in
federal taxable income.

(14)
Add or deduct the amount the taxpayer would be required to add or
deduct under division (A)(17) or (18) of this section if the
taxpayer's Ohio taxable income was computed in the same manner as an
individual's Ohio adjusted gross income is computed under this
section.

(15)
Add, to the extent not otherwise included in computing taxable income
or Ohio taxable income for any taxable year, the taxpayer's
proportionate share of the amount of the tax levied under section
5747.38 of the Revised Code and paid by an electing pass-through
entity for the taxable year.

(16)
Add any income taxes deducted in computing federal taxable income or
Ohio taxable income to the extent the income taxes were derived from
income subject to a tax levied in another state or the District of
Columbia when such tax was enacted for purposes of complying with
internal revenue service notice 2020-75.

(T)
"School district income" and "school district income
tax" have the same meanings as in section 5748.01 of the Revised
Code.

(U)
As used in divisions (A)(7), (A)(8), (S)(6), and (S)(7) of this
section, "public obligations," "purchase obligations,"
and "interest or interest equivalent" have the same
meanings as in section 5709.76 of the Revised Code.

(V)
"Limited liability company" means any limited liability
company formed under former Chapter 1705. of the Revised Code as that
chapter existed prior to February 11, 2022, Chapter 1706. of the
Revised Code, or the laws of any other state.

(W)
"Pass-through entity investor" means any person who, during
any portion of a taxable year of a pass-through entity, is a partner,
member, shareholder, or equity investor in that pass-through entity.

(X)
"Banking day" has the same meaning as in section 1304.01 of
the Revised Code.

(Y)
"Month" means a calendar month.

(Z)
"Quarter" means the first three months, the second three
months, the third three months, or the last three months of the
taxpayer's taxable year.

(AA)(1)
"Modified business income" means the business income
included in a trust's Ohio taxable income after such taxable income
is first reduced by the qualifying trust amount, if any.

(2)
"Qualifying trust amount" of a trust means capital gains
and losses from the sale, exchange, or other disposition of equity or
ownership interests in, or debt obligations of, a qualifying investee
to the extent included in the trust's Ohio taxable income, but only
if the following requirements are satisfied:

(a)
The book value of the qualifying investee's physical assets in this
state and everywhere, as of the last day of the qualifying investee's
fiscal or calendar year ending immediately prior to the date on which
the trust recognizes the gain or loss, is available to the trust.

(b)
The requirements of section 5747.011 of the Revised Code are
satisfied for the trust's taxable year in which the trust recognizes
the gain or loss.

Any
gain or loss that is not a qualifying trust amount is modified
business income, qualifying investment income, or modified
nonbusiness income, as the case may be.

(3)
"Modified nonbusiness income" means a trust's Ohio taxable
income other than modified business income, other than the qualifying
trust amount, and other than qualifying investment income, as defined
in section 5747.012 of the Revised Code, to the extent such
qualifying investment income is not otherwise part of modified
business income.

(4)
"Modified Ohio taxable income" applies only to trusts, and
means the sum of the amounts described in divisions (AA)(4)(a) to (c)
of this section:

(a)
The fraction, calculated under section 5747.013, and applying section
5747.231 of the Revised Code, multiplied by the sum of the following
amounts:

(i)
The trust's modified business income;

(ii)
The trust's qualifying investment income, as defined in section
5747.012 of the Revised Code, but only to the extent the qualifying
investment income does not otherwise constitute modified business
income and does not otherwise constitute a qualifying trust amount.

(b)
The qualifying trust amount multiplied by a fraction, the numerator
of which is the sum of the book value of the qualifying investee's
physical assets in this state on the last day of the qualifying
investee's fiscal or calendar year ending immediately prior to the
day on which the trust recognizes the qualifying trust amount, and
the denominator of which is the sum of the book value of the
qualifying investee's total physical assets everywhere on the last
day of the qualifying investee's fiscal or calendar year ending
immediately prior to the day on which the trust recognizes the
qualifying trust amount. If, for a taxable year, the trust recognizes
a qualifying trust amount with respect to more than one qualifying
investee, the amount described in division (AA)(4)(b) of this section
shall equal the sum of the products so computed for each such
qualifying investee.

(c)(i)
With respect to a trust or portion of a trust that is a resident as
ascertained in accordance with division (I)(3)(d) of this section,
its modified nonbusiness income.

(ii)
With respect to a trust or portion of a trust that is not a resident
as ascertained in accordance with division (I)(3)(d) of this section,
the amount of its modified nonbusiness income satisfying the
descriptions in divisions (B)(2) to (5) of section 5747.20 of the
Revised Code, except as otherwise provided in division (AA)(4)(c)(ii)
of this section. With respect to a trust or portion of a trust that
is not a resident as ascertained in accordance with division
(I)(3)(d) of this section, the trust's portion of modified
nonbusiness income recognized from the sale, exchange, or other
disposition of a debt interest in or equity interest in a section
5747.212 entity, as defined in section 5747.212 of the Revised Code,
without regard to division (A) of that section, shall not be
allocated to this state in accordance with section 5747.20 of the
Revised Code but shall be apportioned to this state in accordance
with division (B) of section 5747.212 of the Revised Code without
regard to division (A) of that section.

If
the allocation and apportionment of a trust's income under divisions
(AA)(4)(a) and (c) of this section do not fairly represent the
modified Ohio taxable income of the trust in this state, the
alternative methods described in division (C) of section 5747.21 of
the Revised Code may be applied in the manner and to the same extent
provided in that section.

(5)(a)
Except as set forth in division (AA)(5)(b) of this section,
"qualifying investee" means a person in which a trust has
an equity or ownership interest, or a person or unit of government
the debt obligations of either of which are owned by a trust. For the
purposes of division (AA)(2)(a) of this section and for the purpose
of computing the fraction described in division (AA)(4)(b) of this
section, all of the following apply:

(i)
If the qualifying investee is a member of a qualifying controlled
group on the last day of the qualifying investee's fiscal or calendar
year ending immediately prior to the date on which the trust
recognizes the gain or loss, then "qualifying investee"
includes all persons in the qualifying controlled group on such last
day.

(ii)
If the qualifying investee, or if the qualifying investee and any
members of the qualifying controlled group of which the qualifying
investee is a member on the last day of the qualifying investee's
fiscal or calendar year ending immediately prior to the date on which
the trust recognizes the gain or loss, separately or cumulatively
own, directly or indirectly, on the last day of the qualifying
investee's fiscal or calendar year ending immediately prior to the
date on which the trust recognizes the qualifying trust amount, more
than fifty per cent of the equity of a pass-through entity, then the
qualifying investee and the other members are deemed to own the
proportionate share of the pass-through entity's physical assets
which the pass-through entity directly or indirectly owns on the last
day of the pass-through entity's calendar or fiscal year ending
within or with the last day of the qualifying investee's fiscal or
calendar year ending immediately prior to the date on which the trust
recognizes the qualifying trust amount.

(iii)
For the purposes of division (AA)(5)(a)(iii) of this section, "upper
level pass-through entity" means a pass-through entity directly
or indirectly owning any equity of another pass-through entity, and
"lower level pass-through entity" means that other
pass-through entity.

An
upper level pass-through entity, whether or not it is also a
qualifying investee, is deemed to own, on the last day of the upper
level pass-through entity's calendar or fiscal year, the
proportionate share of the lower level pass-through entity's physical
assets that the lower level pass-through entity directly or
indirectly owns on the last day of the lower level pass-through
entity's calendar or fiscal year ending within or with the last day
of the upper level pass-through entity's fiscal or calendar year. If
the upper level pass-through entity directly and indirectly owns less
than fifty per cent of the equity of the lower level pass-through
entity on each day of the upper level pass-through entity's calendar
or fiscal year in which or with which ends the calendar or fiscal
year of the lower level pass-through entity and if, based upon clear
and convincing evidence, complete information about the location and
cost of the physical assets of the lower pass-through entity is not
available to the upper level pass-through entity, then solely for
purposes of ascertaining if a gain or loss constitutes a qualifying
trust amount, the upper level pass-through entity shall be deemed as
owning no equity of the lower level pass-through entity for each day
during the upper level pass-through entity's calendar or fiscal year
in which or with which ends the lower level pass-through entity's
calendar or fiscal year. Nothing in division (AA)(5)(a)(iii) of this
section shall be construed to provide for any deduction or exclusion
in computing any trust's Ohio taxable income.

(b)
With respect to a trust that is not a resident for the taxable year
and with respect to a part of a trust that is not a resident for the
taxable year, "qualifying investee" for that taxable year
does not include a C corporation if both of the following apply:

(i)
During the taxable year the trust or part of the trust recognizes a
gain or loss from the sale, exchange, or other disposition of equity
or ownership interests in, or debt obligations of, the C corporation.

(ii)
Such gain or loss constitutes nonbusiness income.

(6)
"Available" means information is such that a person is able
to learn of the information by the due date plus extensions, if any,
for filing the return for the taxable year in which the trust
recognizes the gain or loss.

(BB)
"Qualifying controlled group" has the same meaning as in
section 5733.04 of the Revised Code.

(CC)
"Related member" has the same meaning as in section
5733.042 of the Revised Code.

(DD)(1)
For the purposes of division (DD) of this section:

(a)
"Qualifying person" means any person other than a
qualifying corporation.

(b)
"Qualifying corporation" means any person classified for
federal income tax purposes as an association taxable as a
corporation, except either of the following:

(i)
A corporation that has made an election under subchapter S, chapter
one, subtitle A, of the Internal Revenue Code for its taxable year
ending within, or on the last day of, the investor's taxable year;

(ii)
A subsidiary that is wholly owned by any corporation that has made an
election under subchapter S, chapter one, subtitle A of the Internal
Revenue Code for its taxable year ending within, or on the last day
of, the investor's taxable year.

(2)
For the purposes of this chapter, unless expressly stated otherwise,
no qualifying person indirectly owns any asset directly or indirectly
owned by any qualifying corporation.

(EE)
For purposes of this chapter and Chapter 5751. of the Revised Code:

(1)
"Trust" does not include a qualified pre-income tax trust.

(2)
A "qualified pre-income tax trust" is any pre-income tax
trust that makes a qualifying pre-income tax trust election as
described in division (EE)(3) of this section.

(3)
A "qualifying pre-income tax trust election" is an election
by a pre-income tax trust to subject to the tax imposed by section
5751.02 of the Revised Code the pre-income tax trust and all
pass-through entities of which the trust owns or controls, directly,
indirectly, or constructively through related interests, five per
cent or more of the ownership or equity interests. The trustee shall
notify the tax commissioner in writing of the election on or before
April 15, 2006. The election, if timely made, shall be effective on
and after January 1, 2006, and shall apply for all tax periods and
tax years until revoked by the trustee of the trust.

(4)
A "pre-income tax trust" is a trust that satisfies all of
the following requirements:

(a)
The document or instrument creating the trust was executed by the
grantor before January 1, 1972;

(b)
The trust became irrevocable upon the creation of the trust; and

(c)
The grantor was domiciled in this state at the time the trust was
created.

(FF)
"Uniformed services" means all of the following:

(1)
"Armed forces of the United States" as defined in section
5907.01 of the Revised Code;

(2)
The commissioned corps of the national oceanic and atmospheric
administration;

(3)
The commissioned corps of the public health service.

(GG)
"Taxable business income" means the amount by which an
individual's business income that is included in federal adjusted
gross income exceeds the amount of business income the individual is
authorized to deduct under division (A)(28) of this section for the
taxable year.

(HH)
"Employer" does not include a franchisor with respect to
the franchisor's relationship with a franchisee or an employee of a
franchisee, unless the franchisor agrees to assume that role in
writing or a court of competent jurisdiction determines that the
franchisor exercises a type or degree of control over the franchisee
or the franchisee's employees that is not customarily exercised by a
franchisor for the purpose of protecting the franchisor's trademark,
brand, or both. For purposes of this division, "franchisor"
and "franchisee" have the same meanings as in 16 C.F.R.
436.1.

(II)
"Modified adjusted gross income" means Ohio adjusted gross
income plus any amount deducted under divisions (A)(28) and (34) of
this section for the taxable year.

(JJ)
"Qualifying Ohio educator" means an individual who, for a
taxable year, qualifies as an eligible educator, as that term is
defined in section 62 of the Internal Revenue Code, and who holds a
certificate, license, or permit described in Chapter 3319. or section
3301.071 of the Revised Code.

(KK)
"Professional employer organization," "professional
employer organization agreement," and "professional
employer organization reporting entity" have the same meanings
as in section 4125.01 of the Revised Code.

(LL)
"Alternate employer organization" and "alternate
employer organization agreement" have the same meanings as in
section 4133.01 of the Revised Code.

(MM)
"Casino gaming" has the same meaning as in section 3772.01
of the Revised Code, "lottery sports gaming" has the same
meaning as in section 3770.23 of the Revised Code, "sports
gaming" has the same meaning as in section 3775.01 of the
Revised Code, and "video lottery terminal" has the same
meaning as in section 3770.21 of the Revised Code.

Section
2.
That
existing section 5747.01 of the Revised Code is hereby repealed.

Section
3.
Section
1 of this act, except for sections 4143.03 and 4143.13 of the Revised
Code, takes effect twelve months after the effective date of this
section.

Section
4143.03 of the Revised Code, as enacted by this act, takes effect
January 1, 2029.

Section
4143.13 of the Revised Code, as enacted by this act, takes effect on
the effective date of this section.