Ohio Department of Taxation About the Department

Responsibilities of the Department

The Ohio Revised Code (Section 5703.05) states that “all powers, duties and functions of the Department of Taxation are vested in and shall be performed by the Tax Commissioner…” The Tax Commissioner is appointed by the Governor, is subject to confirmation by the Ohio Senate, and serves at the pleasure of the Governor.

In general, the Tax Commissioner is responsible for the administration of most state-collected taxes and several locally-collected taxes, and exercises supervision over the real property tax. Responsibilities also involve several programs that distribute revenues to local governments, including:

• motor fuel tax distributions;
• local property tax relief reimbursements;
• distributions from the Library and Local Government Support Fund, the Local Government Fund, the   Local Government Revenue Assistance Fund; and
• distributions from the Local Government Property Tax Replacement Fund.

The Tax Commissioner is empowered to make “all tax assessments, valuations, findings, determinations, computations and orders,” which the department is, by law, authorized and required to make, as well as to review or re-determine or to correct previous assessments, valuations or findings. The Tax Commissioner’s other principal responsibilities are:

• promulgating rules and regulations and preparing and distributing tax returns and other reporting forms;
• auditing returns, levying assessments and penalties, and granting or denying tax refunds; and

• issuing, revoking or suspending certain licenses and permits.

In addition, the Tax Commissioner has certain specified duties. These are:

• actual collections of individual income, horse racing, sales, commercial activity, corporation franchise, and excise taxes;
• operating a central collection and reporting system for the municipal income taxes on electric companies and telephone companies; and
• maintaining a continuous study of the practical operation of the taxation and revenue laws of the state, the probable revenue effect of legislation introduced to change existing laws, and proposed measures providing for other forms of taxation.

To efficiently perform these numerous functions, the Tax Commissioner is authorized by law to create such divisions and sections of employees as are deemed proper. The organization chart indicates the structure of the department as of April 25, 2007. In addition to four Deputy Tax Commissioners, one of whom also serves as Chief Legal Counsel, the department also has a Chief Information Officer and seven executive administrators. These executive staff members oversee various operating divisions whose functions are purely tax administration of the various taxes. These operating divisions include:

• Sales and use
• Operations and support
• Business and corporation franchise
• Commercial activity tax
• Individual income and school district income
• Personal property
• Public utility
• Excise
• Tax equalization
• Estate

There are also administrative service and support staff sections, including:

• Audit
• Chief counsel
• Budget and fiscal
• Employee development and training
• Human resources
• Forms
• Enforcement
• Appeals management
• Revenue accounting
• Tax appeals
• Tax analysis
• Compliance/Taxpayer services
• Legislation
• Communications
• Information services
• Bankruptcy
• Internal audit
• Tax discovery

The department also has a Problem Resolution Officer on staff, assigned to the Office of Chief Counsel, who provides additional assurance to taxpayers that their rights are being protected. To further serve Ohio residents and those in other states that have a business or residential nexus with Ohio, Taxpayer Service Centers are located in eight major cities throughout Ohio, with two in Columbus and one each in Akron, Cleveland, Cincinnati, Dayton, Toledo, Youngstown, and Zanesville. There are also regional audit centers in New York City, Chicago, and Los Angeles.

At the close of Fiscal Year 2006 there were 1,410 permanent employees and 247 intermittent employees within the department. Expenditures of approximately $137.3 million were made during the fiscal year to fulfill the department’s various functions and responsibilities. Further details on the number of employees and expenditures are shown in Table 1 and Table 2.

The Ohio Department of Taxation also has an assessment role which consists of levying assessments against corporations and individuals which either file taxes incorrectly, or fail to pay or do not pay the full amount of taxes due. For holders of tangible and intangible personal property, the assessment process is used to determine taxable value of the property.