Ohio Department of Taxation Clarifies Effective Dates for Marketplace Legislation

[July 24, 2019] On July 23, 2019, the Ohio Department of Taxation released a tax alert clarifying and detailing the sales tax and nexus implications for marketplace facilitators, based on the recent passing of Ohio H.B. 166. 

As previously reported by Sovos, H.B. 166 obligates marketplace facilitators to collect and remit Ohio sales taxes on behalf of any sellers utilizing the facilitator’s platform. The additional guidance released from the Department clarifies that obligation for marketplace facilitators to collect and remit Ohio sales and use taxes comes into effect on August 1, 2019. For marketplace facilitator’s who have passed the $100,000 or 200 transaction threshold in the current or prior calendar years, their first filing obligation on behalf of themselves and any sellers utilizing the facilitator’s platform will commence on September 1, 2019. 

In addition, the Department has clarified that for marketplace facilitators who sell on behalf of sellers that are within the state of Ohio, rather than the existing origin sourcing rules applying, destination based sourcing will be required. This means that for all marketplace facilitator transactions all tax will be sourced to the location where the customer receives the service or property they have purchased. 

The clarifying guidance from the Department of Taxation can be seen in this tax alert, here

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Author

Kaitlyn Smethurst

Katie Smethurst is a Regulatory Counsel at Sovos. Within Sovos’ Regulatory Analysis function, Katie focuses on global sales tax and VAT issues, supporting both the tax determination and reporting engines. Katie received her B.A. in International Relations and Spanish from Roger Williams University and her J.D. from Suffolk University Law School. She is a member of the Massachusetts and New Hampshire Bars.
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